Your Staff Can Become an HR Referral Source

Maximizing Employee Referrals

The power of an employee referral is well known in the recruiting industry. A recent poll of business showed that 41.4% of businesses referrals account for 80% of sales. From a business perspective that is an overwhelming number in terms of dollars earned from word of mouth marketing. Through the eyes of an HR professional, a referral is seem as the #1 source of a quality hire according to There are rarely any bad statistics when it comes to using your staff as a referral source, but how do you entice them to provide quality hires.

Without incentive your company’s staff are less likely to invite their friends, connections, and acquaintances to apply for a job that might have a higher than normal turnover rate. The cost of a referral is substantially lower, in fact using referral programs for executive and technical positions can really reduce the cost of executive searches or agency fees. In doing so, a well-rounded referral program can make your referral cost lower then traditional sources. The benefits are not only strong from a business perspective, but from a recruiting function, there are many factors that help your company.

Creating and establishing a successful referral program takes time and can only work effectively when your employees are incentivized properly. Here are a few tips that’ll ensure your creating value within your own program:

Creating a successful internal referral system

Knowledge of Open Positions: With larger corporations and several open positions there is usually a disconnect between current employees and recruiters when it comes to positions that need to be filled. Post regular notices, use your internal network, and actively engage your employees in the benefits of using their own personal network to gain better hires. Referrals are the fastest time to fill positions with an average of 29 days. Depending on the size of your company that could cost the company up to $12,500 a year.

Incentivize Your Employees. Who wouldn’t want money whenever a friend got a job? It’s worth it to work for small retail businesses and earn $200 each time a friend is employed. Employee recommendations not only increase retention rates, but 70% of employers also believe that referred workers are more in line with the company’s values and culture. Hourly workers are constantly looking for methods to earn extra money, so your business may benefit from this.

Make it Fun! Who doesn’t want to have fun at work? Create leader boards, contests, promotions, giveaways, and anything else under the sun that’ll make obtaining employee referrals fun. The prize doesn’t have to be monetary, but building a pool of quality employees saves a recruiter time which saves your employer money. This type of program isn’t going to appeal to everyone in your company, but you only need a few competitive people to build lists of 10-15 potential recruits for your business.

Tapping into your staff for referrals

How do you tap into your internal network to find great referrals?

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Eric Friedman

Eric Friedman is the founder and CEO of eSkill Corporation, a leading provider of Web-based skills testing for pre-employment and training. Since 2003, has tested millions of job candidates for organizations worldwide such as Zappos, ADP, Coca-Cola, Randstad, and GE. With academic degrees in Psychology and Business and experience with both mature and expansion-stage company growth, Eric has focused on how to hire and motivate team members to be the best they can be for their companies.

Reader Interactions


  1. Jessica Miller-Merrell says

    I love this idea and I can attest that employee referrals can be a powerful tool. The key is to make it easy and to make it lucrative for them from a monetary standpoint. What I mean by them is pay them well. Gamification using employee referrals is also a great option companies can consider as part of their corporate referral program.


  2. Adele swift says

    The biggest and most cost effective resourcing tool for us in contact centre recruitment and supports employee engagement and retention


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