5 things to consider when setting up an employee referrals rewards program

Orla Hodnett
Orla Hodnett

Employee referrals are one of the most effective ways of hiring. Higher quality hires, reduced time to hire and an increased retention rate are three of the main arguments for it and they’re probably enough to win that debate. An employee referral program needs a little bit of organisation and, of course, the efforts of your employees need to be rewarded.

Operations

Setting up a process for employee referrals is essential. Communications must be maintained with both the employee referrer and the potential candidate. Records must be kept on the process, as well as data gathering. Keeping the program going is something that will be discussed a little later.

HireHive is a useful tool to use in your referrals program, as it actually helps you to set one up. Online recruiting software can help you track the process from start to finish and will help with any future referrals campaigns.

This is part of our Social Recruiting series

Monetary rewards

Money talks, so a cash reward may be the way to go. Try experimenting with the reward offered. Start small and see how effective the program is. It may be that the cash reward ends up impacting your ROI and making an otherwise highly effective system into a false economy.  

It’s a good idea to offer a higher reward for those who refer hard-to-find candidates or candidates with skills in short supply

It’s a good idea to offer a higher reward for those who refer hard-to-find candidates or candidates with skills in short supply. If it’s a key job for the organisation a higher reward is advised. As stated already, this system is for the benefit of the team. The reward should reflect the importance to your colleagues.

No cash rewards?

The absence of resources for offering cash rewards can act as a disincentive to a recruiter. This should not really hold you back. Recent findings show that only 11% of employees involved in such programs are motivated by the promise of a cash reward. Many more employees are motivated by doing it for the good of the team.

Offering credit or recognition to employees is what is really important here

Offering credit or recognition to employees is what is really important here. Whether it’s just a t-shirt or certificate for their desk or a free lunch out, showing appreciation for employees’ valuable input to the recruiting process is going to improve participation.

Keep the ball rolling

You might have set a lovely referrals program set up and you might have gotten a couple of CVs from your colleagues and then it sort of trails off… and people start putting posters for fun runs over your poster in the canteen. Keeping through referrals machine going is the challenge here, but the rewards are worth it.

The trick is keeping the program at the back of people’s minds. Email reminders are a good idea, but don’t overdo it. Distinctive reminders, like sandwich boards or digital posters on screens in the office, are an engaging way of doing things.

Data

If you are using recruiting software, like HireHive, you will have quite a bank of data to draw from. You will be able to determine who your top referrers are and the effectiveness of those hires. Data can really highlight the value and quality of employees referrals.

This is also a useful way of demonstrating the value of this to the referrers and encourage their participation. It will also allow you to compare with the competition and see how you fare.

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