Ten Steps for a Successful Employee-Referral Program

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houghtfully implemented employee referral plans are excellent ways to attract the best people at the lowest cost. Consider the following guidelines when starting your own program:

1. Start at the top: If senior management is not committed to the successof the program, it won’t work. ERPs must be clearly communicated from the topdown to make it clear that it’s everyone’s job to actively search for talent.

2. Keep rules to a minimum: Complex submission rules, coupled withsix-month length-of-stay requirements, are the easiest way to limitparticipation in ERPs.

3. Let everyone participate: Why exclude senior managers from referralprograms? Doesn’t it make more sense to share a $1,000 referral fee with asenior VP than to pay a contingency search firm $25,000? Also, consider allowingHR staff to participate. As long as they are not directly involved in hiring fora specific opening, why not benefit from their network of contacts?

4. Involve and reward outsiders: Alumni are great sources for talent, asare vendors, customers, and people who have turned down offers. How about youremployees’ friends and former business associates? They can all lead to topcandidates, so it’s advisable to involve them in the program and reward them fortheir efforts. Casting the referral net a little wider can yield better results.

5. Give VIP status to résumés: Give special, fast-track treatment torésumés referred by employees. Employee-referred candidates should be calledquickly. (Find the time to do this by following the next rule.)

6. Let employees track progress: Let employees check the status ofreferred candidates themselves, rather than bombard the recruiter with calls ande-mails to see if a friend has been hired. Along the same lines, send employeese-mails to let them know how their referred candidates are advancing in thehiring process.

7. Make it easy to refer: Employees should be able to look at availableopenings and “push” them out to their friends with the click of amouse. If they have to copy and paste job descriptions into an e-mail, yourreferral numbers could suffer.

8. Promote constantly: Weekly “hot job” e-mails, combined withe-mails announcing the list of employees who have referred successfully, aregreat ways to keep ERP momentum strong. Motivate staff with company-widecongratulatory e-mails from the CEO about those who took the time to makereferrals. Posters on the refrigerator and in the bathrooms work well, too.

9. Pay a decent bonus: These days, $1,000 is a good minimum bonus. Thebonus for top jobs, however, can go upwards of $10,000. More than $10,000 justmight be too much, as employees begin to get skeptical that the bounty will everin fact be paid.

10. Pay it fast: When an employee is entitled to a finder’s fee, pay it ontime. Don’t force employees to follow up on fees that they have earned.

Source: Joseph Slavin, general manager, Referral Networks

Workforce, June 2001, p. 68 —  SubscribeNow!