How to Supercharge Your Hiring By Rewarding Employees For Referrals
By CINDY MIELKE
Finding the perfect employees for your business can be tough—especially with so many job ads and candidates out there. But there’s a smart way to simplify this process—offer referral incentives to employees to help find pre-qualified candidates.
This approach taps into the potential of your existing employees and their personal networks. By encouraging your team members to recommend qualified candidates, you create an opportunity for more personalized and effective recruitment.
Employee referral incentives are special benefits or bonuses given to employees who recommend suitable candidates for job positions in their company. These incentives motivate employees to use their personal and work contacts to find great new team members for the organization.
Referral incentives are a great way to include your team in the recruitment process. There’s a variety of incentives that can be offered, such as cash bonuses, digital gift cards, or additional vacation time. But it’s important to ensure these incentives are attractive to your employees while also fitting into your company’s budget.
The Impact and Importance: In the challenging race to secure top talent, relying solely on default hiring methods may not be enough to bring in the best candidates. A significant benefit of offering incentives for employee referrals is that it opens doors to a wider and varied group of potential hires.
Here’s how it can be beneficial:
When employees recommend someone they know, their endorsement often holds more significance than traditional job ads or recruitment tactics, as they can vouch for the candidate’s abilities, achievements, work ethic, and compatibility with the company culture.
Through these referrals, employees often bring forward candidates who might not be actively seeking new opportunities. This means that a well-structured referral program allows companies to tap into a pool of high-quality talent that isn’t accessible through conventional recruitment methods.
Implementing referral incentives is a clever strategy to acknowledge and incentivize employees for their contributions to the hiring process.
Employee referral programmes can be a much more budget-friendly way to hire people. Traditional ways of finding candidates, like advertising and using recruiters, can be expensive and might not always work well. But when companies use a referral program, they use their own employees and their connections to find new hires, which typically costs considerably less.
Studies also show that people hired through referrals often stay at the job longer. This happens because referred candidates usually fit well with the company’s culture and needs, which means there’s less chance they’ll leave the job quickly, saving the company from expensive turnover costs.
Reward Referrals: To encourage more participation in employee referral programs, companies can offer various incentives for successful referrals. Below are some examples of how these incentives can be formatted:
A tiered reward system gives different types of incentives depending on how well the referral does or for which job they’re referred. For instance, you might give a small gift card just for suggesting someone, a larger gift card if that person gets an interview, and an even bigger one if they get the job.
This method motivates employees to recommend really good candidates because they get incentives at every step of the hiring process.
Adding a lucky draw to your referral program can make it more exciting and enjoyable for employees. In this situation, an employee could get a raffle ticket for each successful referral they make.
These draws can be held every three months or once a year, with prizes like gift cards or cash-based incentives. As an added bonus, the more successful referrals an employee makes, the more tickets they receive, increasing their chances of winning.
Offering travel-related incentives can be a great draw in your referral program. Employees who refer good candidates can get gift cards for airlines, hotels, or travel agencies. This gives them a chance to organize a vacation they’ve been dreaming of. It’s also a way to thank them for helping with the company’s recruitment efforts and can be a great option for work anniversary gifts.
Personalizing Incentives: Having incentives that cater to individual tastes and interests shows your employees that you care about what they like. You can do this by purchasing bulk gift cards for employees from different stores so employees can pick the ones they prefer.
For example, they might choose from Amazon, Starbucks, or Best Buy gift cards based on the types of products they use. This method demonstrates that you’ve put thought into the incentives and want to make your referral program attractive to everyone. It’s also a good idea for celebrating work anniversaries or achieving company milestones.
Referrals For Better Results: Employee referral programs are a great way to boost your company’s hiring process and encourage steady growth. By using your employees’ networks, you can make hiring faster and easier, rely less on outside sources, and use your company resources more efficiently.
These programs also improve employee morale and involvement by showing that you appreciate their help in finding new talent. With different kinds of incentives like tiered bonuses, raffle-based awards, or travel incentives, you can adjust the program to fit your company’s goals and offer meaningful benefits to your team.
Author bio: Cindy Mielke is Tango Card‘s Vice President, Strategic Partnerships, and a Certified Professional of Incentive Management. Her passion is helping teammates, clients, and partners achieve success. A strong advocate for the incentive industry, Cindy received the Karen Renk Award and the Lifetime Achievement Award from the Incentive Marketing Association (IMA) in 2019. She currently serves on the IMA board of directors and on the board of the Incentive and Engagement Solutions Providers (IESP)
