The recruitment game is a fast one and uncovering the right talent may seem like trying to find a needle in a haystack. However, companies have a valuable resource at their disposal that is often underutilised: their current employees. An employee referral program can greatly improve recruitment processes by bringing in quality talents through trusted recommendations.

An employee referral program is a recruitment tactic that uses your existing staff to identify potential candidates. Generally employers tend to incentivise employees when they refer a candidate for the open roles. When hiring a referred candidate, the referring employee receives an award if the referred person stays with the company for a specific amount of time.

Companies who are expanding and do not want to burn out their recruiters or hiring managers can really benefit from running an employee referral program. Indeed found that 66% of companies use referral programs to hire candidates, making internal referrals the third most common way for an organisation to fill positions behind online job sites and company career pages.

1. Get Management on Board: Get Management all on board- make sure they know the value of the program and that employees are rewarded for participating. Employ management to establish hiring targets and distribute the resources you need, all without exceeding your budget constraints.

2. Create an Easy Referral Process: The referral process should be straightforward and user-friendly. Options include:

3. Set Goals: Identify specific, measurable goals for the referral program, such as:

4. Offer a Mix of Incentives: Provide a range of incentives, including cash bonuses, paid vacation days, extra personal days, desirable consumer electronics, gift certificates, or charitable donations matched by the company. Consider holding referral contests and polling employees to identify motivating incentives.

5. Announce the Program and Provide Instructions: Publicise the incentive structure and provide clear instructions for making referrals. Include details in new hire onboarding processes and post information in common areas like break rooms.

6. Recognise Employees for Referrals: Acknowledge employees who make successful referrals through:

7.Integrate Referrals into Your Company Culture: Make the referral program a natural part of the company culture by:

8. Track the Success of Your Referral Program: Evaluate the program by tracking metrics such as:

Employee referral programs have a proven track record of enhancing recruitment processes. Here are some compelling success stories and statistics:

1. Google’s Referral Program: Google has a difficult interview process but at the same time it acknowledges how important employee referrals are to hire. Google is known to have succeeded in its referral program as the retention of referred recruits was about 46% higher than non-referred candidates. Thus proving the long-term value of referral hiring.

2. Statistics on Referral Programs: As per a recent research by Society for Human Resource Management (SHRM), it is reported that 30% of all hires are from employee referrals, making referral programs the best source. This shows how important referrals are in the recruitment process. Referred candidates are hired 55 percent faster as well compared to career sites and other channels. Referrals can also add an extra element of mastery over time-to-fill positions, hiring faster through referrals than the traditional method. Those hired via referrals have a 45% retention rate, actually working there more than four years in comparison to creating job titles of not even needing for one year. This demonstrates the quality and potential long-term viability of referred candidates.

3. Salesforce’s “Employee Referral Champion” Initiative: Salesforce introduced a program where top referrers are recognised as “Employee Referral Champions” and receive special rewards and recognition. This initiative led to a 42% increase in employee referrals and contributed to a more engaged and motivated workforce. Recognising top contributors can boost morale and increase participation.

4. Accenture’s Employee Referral Program: Accenture’s program encourages employees to donate part of their referral bonuses to a charity of their choice, with the company matching the donation. This approach fosters a sense of social responsibility while still incentivising referrals.

Implementing an employee referral program can save hiring resources and improve the quality of new hires. With careful planning, clear goals, a straightforward referral process, and a mix of attractive incentives, you can create a program that not only enhances your recruitment strategy but also strengthens your company culture.

Start building your referral program today and watch your recruitment processes become more efficient and effective.