How to Use and Implement an Employee Referral Program to Fill Engineering Positions

Implementing An Employee Referral Program

Filling Engineering roles, especially the mid-level (5 to 8 years of experience), can be a real challenge. There are many concepts and strategies to recruit top engineering talent that I’ve shared in previous posts, but oftentimes great employees can come from referrals within your organization.

So, today I wanted to take a deeper dive on the idea of implementing an Employee Referral Program as part of your recruiting strategy.

We’ve all heard the saying, “Birds of a feather flock together” right? Well, employee referrals can provide high quality, passive candidates (meaning those not actively seeking new opportunities) for those hard to fill roles because your employees have a really clear understanding of the type of person who will be successful within your company’s culture. There is often a sense of responsibility attached to the candidate they refer because they feel like the candidate is a reflection of them and their performance. The same is true on the candidate side. Because they were referred, there is a sense of obligation to the person who referred them.

There is plenty of evidence that supports this idea. For example, a study by Stanford states that employees hired through personal referrals have higher productivity, lower turnover, and lower screening costs, and another study by HaaS Berkeley states that referred workers are substantially less likely to quit. You will be hard pressed to find a company that has effectively implemented an Employee Referral Program who doesn’t say it is in their top two strategies for hiring the best employees.

The most difficult part of an Employee Referral Program is knowing where to start. There are many factors to consider when designing an Employee Referral Program, so it’s best to involve an HR professional to assist with designing the program to ensure there is no disparate impact and that the coordination, communication, and measurement of the program are all covered. All of this being said, here are a few ideas to consider when designing an effective Employee Referral Program that converts to hires for your company.

Make it easy to navigate – Nothing can kill the best intentioned referral program like complicating it by creating all kinds of hoops for the employee to jump through. Keep it simple. When designing your program, look at it from your employee’s perspective. If you make it easy for them, you will have much more participation in the program resulting in a much better outcome.

Come up with rewards that will encourage employee participation – Most of the clients we work with offer bonus payments of some sort tied to the successful hiring of a referred candidate, retention of that candidate or a combination of the two, but there are several other creative ideas to incentivize your employees to participate. These could include extra time off with pay, gifts, gifts cards, entry into quarterly drawing for a bigger prize, and recognition in staff meetings or company newsletters. Again, design your program with your employee’s perspective in mind - plan a brainstorming session for ideas that are meaningful to them. Remember, you want them to participate.

Build your Referral Program into your Culture – Effective communication and promotion of the plan is critical. We work with several companies who have Employee Referral Programs but as more of an afterthought and not part of an overarching recruiting strategy. Your Referral Program should be built into the fabric of your culture. Get your employees excited about it and keep it top of mind! The more participation, the better the result.

Be proactive – Last but not least, ALWAYS accept referrals. Whether you’re hiring or not, it’s critical you keep your pipeline and network healthy, especially when we’re talking about those hard to fill positions in the Engineering world. There’s nothing worse than being behind the eight ball when then need does arise and you miss out on potential opportunities or miss deadlines because you don’t have the talent you need. I’ve seen this mistake made time and again. It’s a huge constraint to a company’s growth.

Remember, there’s nothing more critical to your company’s success than its culture, and your employees want your culture to be as strong as you do. They want to work with great employees that care about your business as much as they do, so it only makes sense that they would want to work with people that they know will make great coworkers. Implementing an Employee Referral Program can help get you started.

-- Kelly