Are you struggling to find the right talent for your small business? Are you tired of sifting through countless resumes and conducting endless interviews? Well, what if we told you that there’s a powerful tool that can help you attract top talent, improve retention, and reduce the time and cost associated with the hiring process? Enter the employee referral program – a simple yet effective way to tap into the power of your existing workforce and find your next superstar employee.
It's time to learn how to create an employee referral program for your small business that will engage your employees, increase your chances of finding the right candidate, and ultimately help your business thrive. So, whether you’re just starting out or looking to revamp your existing hiring strategy, continue reading to learn how to create an employee referral program that works for your business.
What Is An Employee Referral Program?
An employee referral program is an organized and structured program employers use to ask existing employees to recommend candidates for open positions. It’s a method used to find and hire the best talent from your current employees’ existing networks. Research shows that 88% of employers rate employee referral programs as the best source of new job applicants.
The following are the benefits of offering an employee referral program:
- Improves the quality of hire
- Reduces turnover rate
- Improves employee retention
- Reduces time and cost per hire
- Improves company culture
- Better employee engagement
Now The Challenging Part, Or The Exciting Part (For Us)
Since an employee referral program can be a powerful tool for companies looking to attract top talent, you may be asking how you can create this program within your business. We’ve made it easy for you to implement a referral program within your business by following these simple steps:
- Define your goals: Before your start building your referral program, defining what you hope to achieve is important. Do you want to attract more diverse candidates? Fill certain positions faster? Reduce turnover? Clear goals will help you determine the most effective incentives and rewards.
- Create a process: You’ll need a clear and simple process for employees to follow when referring candidates. This should include details about what kind of candidates you’re looking for, how to submit referrals, and how the selection process will work.
- Offer incentives: Offering incentives is a great way to motivate employees to participate in your referral program. These could be monetary rewards, such as a bonus or percentage of the new hire’s salary, or non-monetary rewards, such as extra vacation days or a special recognition program.
- Communicate with your employees: Make sure your employees are aware of the referral program and its benefits. Consider hosting informational sessions, sending regular updates and reminders, and offering training on identifying and referring great candidates.
- Monitor and measure success: It’s essential to track the success of your program so you can make adjustments as needed. Keep track of metrics such as the number of referrals received, the number of hires made, and the cost per hire.
- Keep it fun: Referral programs should be engaging and enjoyable for employees. Consider hosting friendly competitions or offering additional incentives for referring multiple candidates.
Are There Other Options?
Creating a referral program may seem like the right fit for your business, but it may also seem like a lot of work, right? What if we told you there was a simpler way for you to have an employee referral program all while you can continue growing your business? At GMS, a professional employer organization (PEO), we help small business owners manage their HR needs, including recruiting, hiring, and employee retention. We are your resource if you want to create an employee referral program.
Here are just a handful of ways that we can help you create an employee referral program:
- Develop a comprehensive referral program: PEOs can work with you to develop a referral program tailored to your specific needs. We can help you establish referral bonuses for each position, create a streamlined process for employee referrals, and design the program to maximize employee engagement.
- Manage the hiring process: Once you receive referrals from your employees, our HR experts help you manage the hiring process, including writing legally compliant job ads, screening resumes, setting up the first interview, assisting you in compiling appropriate and legal interview questions, and so much more.
- Monitor the success of the program: Through our applicant tracking system (ATS), we’re able to track the success of your referral program by providing regular reports on the number of referrals, the quality of referrals, and the overall effectiveness of the program.
If this sounds like the right fit for your business, get a quote from us today so you can begin attracting the talent you need to succeed.