Finding top talent is one of the most difficult challenges HR professionals face, and the good news is that they don’t have to go about it alone.
By creating an employee referral program within your organisation, you should be able to leverage the robust network of other top talents on your team of employees.
Just as referral sales require almost no financial investment, but they bring in precious leads, so can word-of-mouth recruitment, especially when done by satisfied employees, provide your organisation with valuable job candidates.
Employee referrals are a highly effective way of building your talent base because the referrers (your current employees) have a good understanding of what you expect from staff members; therefore, the job candidates they refer are more likely to have the skills and mental outlook you’re looking for.
This advantage speeds up the initial screening process so that you can hire qualified talent quicker. In addition, research has shown that employees hired via referrals have lower turnover relative to non-referred employees.
In this article, we explore how to launch an employee referral program and use incentives to encourage participation from your employees.
How to Launch an Employee Referral Programme
1. Set the ball rolling by setting up incentives
As an HR professional, you know your people best. So, what would motivate them to go the extra mile to source quality candidates for your organisation?
Many organisations we have worked with have been able to get their people raring to go by using buzzworthy cash rewards. Cash is not only an effective method for kick-starting an employee referral program; it’s straightforward too.
To make it even more effective, structure it so that the harder-to-fill the role is, the bigger the reward is too. However, be sure to include referral quality and retention (between 90-180 days) as criteria for receiving the full reward.
When a cash incentive isn’t in the budget, many creative alternatives can equally get your employees excited about making referrals. Here are a few:
- An extra day of paid time off
- Few days of remote or flexible work schedules
- Paid lunch out
- Gift card
- Company-wide recognition
2. Launch your programme
Before rolling out your program, take the time to consider how you’d like it to play out. For example, would you prefer a year-round program or a seasonal campaign approach?
While a seasonal referral campaign might better suit your business if you do most of your hiring in certain months of the year or if you’re working on a small budget, a year-round employee referral program is best if you’d like to accept and incentivise referrals at all times.
Considering how tough it is to find quality candidates at short notice these days, a year-round campaign is an excellent option to make sure you’re not waiting until the last moment to fill positions.
It’s also important to consider whether you need referrals for all openings at your company or just those positions that are typically difficult to fill.
Whatever way you decide to configure your program, the setup is mostly the same. You’ll need to:
A. Document your employee referral programme
It is vital to write the policy guidelines that explain your program in detail. When the details are carefully outlined, it is easier for your employees to understand and get excited about participating in the program.
Your guideline should cover the following:
- Positions eligible for incentives
- The protocol for making referrals
- How referrals are processed
- Applicable periods
- How hiring decisions are shared
- The award is applicable when a referral is hired
B. Create a system to track referrals
Most applicant tracking systems have referral features that you can immediately leverage to track the referrals from your employees.
However, if you don’t use an ATS, you will need to devise a creative way to use spreadsheets or an email account to track all submissions.
Setting up an effective system to track referrals will enable you to assess the program’s results and keep a clean record of which employee made the referral.
Furthermore, your referral tracking system can also serve as a data bank for future candidates. For example, an applicant who doesn’t meet the criteria for one role might meet the criteria for another.
So, having this system in place will mean that you can always refer to your list when you have more open positions.
3. Get creative with marketing the programme to your employees
What has proven to be the most effective way to communicate with your employees? An email or posters. Whichever medium you choose, be sure to promote your referral program continuously until it sticks. Creativity is crucial here.
How you communicate the program to your employees must be memorable and exciting. For instance, you may use posters, an internal job fair event or a video that encourages your employees to reach out to their contacts on social media.
Every time you have a vacancy, be sure to send the job advert with a link to the job posting and a reminder about the referral program.
Pitfalls to Avoid When Launching Employee Referral Programme
Once you’ve designed and launched your program, several pitfalls can diminish its efficacy. Here are three you must avoid at all costs:
1. Lethargic responses
Once your employees start to refer candidates, you must follow up quickly as a hiring manager.
Quick and encouraging responses will show employees that you respect and appreciate their efforts, and this, in turn, will boost your company’s credibility. On the flip side, if you do not get back to your staff, it’ll come across as ingratitude or unseriousness on your part.
Responding too slowly will discourage your people from bringing their contacts on board, killing the program fast.
2. Not giving feedback
Feedback is crucial to the success of your employee referral program. No matter the hiring outcome, it is vital to communicate decisions to candidates and the employees who referred them as soon as it’s possible.
If the trail goes cold because of a lack of follow-up on the status of their referrals, your employees may become frustrated and start losing interest in the program. The only way to prevent this is to carry them along throughout the process.
For instance, it is good to provide feedback to employees via email when their referral is being interviewed or hired. And even if a candidate won’t be offered the job, let the referrer know.
In all that you do, be sure to maintain confidentiality. For example, employees who refer candidates must be advised not to disclose why a person was not offered a particular position.
3. Biased hiring
Employee referral programs can quickly become grounds for nepotism if not well managed. Naturally, employees will refer their friends and family, and these may be hired instead of the best available candidates.
To keep this from happening, be sure to maintain strict professionalism in the hiring process from the get-go. This means that in every interview, you must screen first and foremost based on the department’s needs and the organisation.
In other words, select only candidates with the best skills, and avoid hiring based on friendships alone, as this could negatively affect the organisation in the long run.
In Conclusion
Though an employee referral program has the potential to reduce hiring costs and increase your pipeline of quality hands, it can only live up to its full potential if the setup mechanism is well executed and well managed.
