April 24, 2018

Employee Referral Program


Employee Referral Program Policy Template

A great employee referral program starts with a fine-tuned program policy.  Establishing and committing to realistic SLA’s (service-level agreements) that you can uphold will go a long way in establishing credibility with your employees, insuring their ongoing participation and engagement in the program.

What are the common SLA’s of a successful Employee Referral Program:

Who is eligible?

Sure, you want referrals from all of your employees, but are you going to pay your CEO the same bonus you would pay a staff-level employee for a successfully hired referral?  You’ll want to make sure you seriously consider (and make clear) who will be awarded financially for referrals, and who won’t.

How to submit (and receive credit for) a referral?

Do you require a form with hiring manager approval before a referral becomes official?  Does the candidate have to apply via your applicant tracking system and acknowledge themselves as a referral of X employee?  Decide exactly what process your employees need to follow to receive credit and clearly communicate that to them.

Who should be referred?

What kinds of candidates will you accept, or reject?  What is your policy on duplicate referrals or candidates that are already in the database?

Referral bonus payouts

What are you paying, to whom, and when?  Do different jobs come with different bonus levels?  How long will it take for an employee to receive their bonus once the candidate is hired?  How will they receive it?

Here are some additional best practices to include in your policy document:

  • If more than one employee refers the same candidate, [they shall share the bonus, the first referrer will receive the bonus].
  • Employees will be paid referral bonuses within [30 days] of their referral meeting qualifications.
    The employee who makes the referral must still be employed at [Company Name] to receive a bonus.
  • Do a referral coffee, lunch, or happy hour when employees can invite referrals to meet the team.
  • Think beyond cash bonuses. What would most help your employees get excited about referrals
  • Ask employees what the best teams were they worked on, and get in touch.

In summary, a referral program is only as successful as the team that is administering it.  That begins and ends with a clearly defined and communicated program policy.