Talent Acquisition

Overcome the Shortage of Top Performing Employees

By

Paycom HR

| May 7, 2014

Recruiters use a variety of tactics to find new hires, but one still trumps them all: employee referrals. While online job boards and career sites remain top sources for applicants, referrals often go overlooked as a hiring resource. From a recruiter’s vantage point, employee referrals equal gold.

As you may imagine, recruiters have to exhaust all the tricks of their trade in order to stay competitive in the market. With a ratio of unemployed persons to job openings sitting at 3-to-1, employee referral programs (ERPs) are an easy way to build your talent pipeline, because you don’t have to look very far.

Best Practices for Referrals

The saying “it’s all about who you know” rings true when discussing the employee referral tactic for your organization. Just think: If half of your employees all had two good references, your workforce potentially could double in size. Not to mention these references are coming from employees you already have evaluated and trust. Your employees are a valuable resource, so use them and their expanded networks to grow your company with talented individuals that already have been vetted.

Perhaps you’re an employee who wants to refer anyone and everyone. That could potentially backfire on you, so consider these best practices:

1. Stick to professional references, such as:

  • a former co-worker,
  • a college class member you’ve worked with,
  • a vendor,
  • a client or
  • a supervisor.

2. Avoid personal references, including:

  • friends,
  • family members and
  • neighbors.

The idea here is that you want to refer someone you personally can vouch for, so it’s best to be selective and consider who would be the best fit for your organization, all emotions aside.

Successful ERPs

As members of the team, your employees know how things operate, what the cultural norm is and who would best fit. Avoid underestimating the successfulness of an ERP. If you currently have a poor-performing one, re-examine your strategies and develop a better plan.

Here are some marks of a successful ERP:

  • A quick response time is kept with both the referral and referring employee.
  • All employees are encouraged to make referrals.
  • It’s not just a revenue generator for employees, but more about creating a solid foundation of great employees. Incentives are secondary and should entail some sort of stipulation such as receiving $100 for each referral hired and employed for a minimum of 90 days.
  • It is managed and maintained consistently. Speak with employees to find out how they know the referral; ask for referrals during on-boarding meetings; and provide employees with referral cards to pass out when appropriate;
  • Training is offered about how to build networks and who constitutes a good referral.
  • The process is made fun, with awards for most referrals, recognition notices sent company-wide and a catchy program name created.

If executed properly, ERPs can have a fruitful return on investment because you’re essentially investing back into your employee base. It’s a win-win for both your organization and employees, so give it a try today!