Employee referral programs typically reward employees for referring someone outside the organization
who is hired for a job. When/if that person is hired and performs acceptably in the job
for at least 90 days (usually), the referring employee usually receives a financial reward.
Employees are usually interested in finding good candidates to refer because they typically
receive a substantial financial benefit for the referral. The reward paid to the employee can range
from a few hundred to a few thousand dollars, typically spread over several months to a year.
The reward may be made when the referred candidate applies for a job, but more often it is made
when the referred candidate has been hired and has performed well for several months.
To incentivize the referring employee to help their referral to succeed, payments may be made
when the person is hired, after the person has been in the job for three to six months, and then,
occasionally, when the referral has been successfully employed for a year.
The best time for the employee and the job seeker to connect is before the job seeker has applied
for the specific job (or, sometimes, for any job with that employer), not after the application has
been made. A referral at the wrong time, according to the employer's rules (see below), may
impact whether or not the referred candidate receive recognition (and favorable treatment) as a
referred candidate. Referral timing also typically impacts whether or not the employee making
the referral qualifies for a reward from the employer. With automated applicant tracking systems,
employers can easily track the timing of both application and referral, and genuine referrals may
be disqualified if the timing seems not to be in compliance with the program's rules.Employee
referral programs operate two main ways:
The employee who is making the referral submits a form naming the applicant. In many cases,
they don't need to specify the job being sought. After the form is accepted, the applicant is
notified of the referral, and invited to look at the jobs and apply. Sometimes these two methods
combine. The employee submits a form, and the applicant provides the name in the application
form. Occasionally, the employee submits a form after the applicant has applied. The rules for
each employer vary, so it is best to understand them before initiating the process. In my research,
I discovered several programs which disqualified someone from being considered as a referred if
they had ever applied for a job with that employer.
Having correct and current information is very important to the success of the process! So, be
exchanging information at the start of the process is essential.
The job applicant should be sure to have the following information about the referring employee:
Both parties need to have the appropriate information
needed to successfully complete the process. This ensures that the applicant receives the advantage
of being referred and the employee receives the appropriate reward.
Referral programs typically have rules about when and how the employee earns the referral fee.
Usually, the referral should happen before the job seeker applies for the job, but it may be acceptable
during the job application process, as indicated above. These days, many employers publish
their ERP program requirements on the website, visible to the public. So, checking the ERP rules
on the employer's website -- if available -- before reaching out to an employee is a very smart
idea. The problems:
For some employers, an applicant who applies before the employee has submitted a referral form
disqualifies the applicant as a referral. For others, the referral form can be submitted after the
person has applied. Many don't require a referral form at all -- simply including the employee's
name and phone number on the application is sufficient "proof" of the referral. Best to know
before starting the process.
A hiring manager cannot typically refer someone, especially not for their own department.
People in HR and recruiting are also usually not able to refer a candidate, either.
Typically, the jobs that are in the ERP - or pay the best reward - are the jobs that are the hardest
to fill, like jobs that are senior or jobs that are hard to fill because qualified candidates are
scarce. So, not every job may be included.
Some locations have a plentiful supply of job candidates, which means no - or a minimal -
reward is offered by the employer. So, location and job matter. Life is never simple these days.
To be the referred candidate, be sure to understand the rules each employer has for their ERP
Susan P. Joyce is Editor/Publisher of Job-Hunt.org and WorkCoachCafe.
com. She is a Visiting Scholar at the MIT Sloan School of Business, and
is the author of How to Find a Job Using Craigslist: Your Guide to Safe and Effective Job Search on Craigslist. She is co-editor of
New Year, New Job! Her background includes service in military intelligence
in the United States Marine Corps.
Contact her as follows: