11 Best Employee Referral Program Ideas for 2021

Home » Resources » Employee Referrals ProgramsUpdated: September 20, 2021

You found our list of unique employee referral program ideas.

Employee referral programs are campaigns where organizations incentivize team members to suggest candidates for open positions by offering rewards. For example, a company might offer bonuses or exclusive experiences. The purpose of these programs is to increase the number of qualified candidates in the hiring pipeline.

Employee referrals are ways to boost employee retention and handle attrition. These initiatives can also increase employee motivation.

This article includes:

  • employee referral rewards program ideas
  • employee referral program contest ideas
  • best practices for employee referral programs
  • referral program ideas for employees

Here are the most helpful ideas!

List of employee referral program ideas

From welcome lunches to alumni referrals to consolation prizes, here is a list of fresh ideas for employee referral programs. Use these ideas to empower employees to help with the hiring process.

1. Alumni Referrals

If you are only asking current employees for recommendations, then you are leaving a massive resource untapped. Individuals who left the company on good terms can be a useful source for referrals. Expanding the program to former employees can widen the search network, as well as reopening lines of communication between the referring ex-employee and the organization.

To set the stage for this arrangement, first create a company alumni group. For example, an email newsletter, a Slack channel, or a social media group. When giving exit interviews, encourage departing team members to join the group. Then, post open positions within the space and encourage members to submit suggestions. For best results, have participants fill out a form or email a designated email address instead of posting publicly on the page.

2. Multiple Levels

Referrals are not one-size fits all. While all team members play an important role in the organization’s success, some positions are more of a challenge than others to hire for. For example, the search for an executive may stretch months or even years, while lower-skill jobs such as receptionists are faster roles to fill. It is vital to have dedicated and capable teammates in all functions of the company, however the referral prize should match the complexity of the recruiting process.

By creating multiple levels of the reward program, you incentivize employees to strive to find more standout candidates and relieve more of the burden put on recruiters and HR staff. We recommend creating a few band levels based on experience or rarity, for example, entry level, mid level, and senior level. Or, you can also recognize employees based on the number of successful hires they suggest.

3. Interview Input

Team members tend to submit names to referral programs not only for a bonus or prize, but also because these individuals think that their friend or family member will be a great addition to the staff. One way to help employees express the qualities that make their candidate shine is to create a field titled “What interview question should we ask this applicant?” on the submission form.

This approach may turn up information that interviewers may not have otherwise uncovered in the course of the conversation. Plus, the exercise helps current employees feel heard and valued, and spotlights the candidate’s best qualities.

Here are more interview question examples.

4. Milestone Payouts

One of the most basic best practices for employee referral programs is to wait to give out rewards. If you hand out the bonus upon hiring, then there is a chance that you may wind up paying employees for hires that only last a few days or weeks. Because the point of the program is to bring on quality, long term employees, the bonus money is not a good investment for the company if the hire does not stick around.

Waiting until after the probationary period ends to give referral rewards is usually a good idea. You can also disperse the payout in instalments, such as at the three month, six month, and year markers.

5. Welcome Lunch

Taking the fresh hire and the referrer out for a welcome lunch on the new team member’s first day is one of the most simple yet effective referral program ideas for employees. The new team member is likely to feel more at ease with a familiar face at the table, since the first day tends to involve meeting many strangers. Meanwhile, the referring employee gets recognition along with free grub.

This outing can also act as a more immediate award for referrers if a cash bonus is pending the referee’s probation period. Plus, community meals are good ideas for team bonding.

6. Choose Your Own Boss

Employees rarely have control over who their bosses are, however employee referral programs can provide the opportunity for input. Choose Your Own Boss is a version of a referral system where staff can recommend managers. Team members have natural incentive to recommend quality candidates, because nobody wants to work under a bad manager.

Participants can suggest past beloved bosses or acquaintances they believe would make marvellous management material, or can meet applicants at a recruitment event or scan interview files and cast votes of confidence for promising characters.

7. Consolation Prizes

If a referred friend does not receive a job offer, then employees may be disappointed. Consolation prizes soften the blow of the letdown, acknowledge the employee’s contribution, and incentivize the team member to keep referring future candidates.

When employees suggest candidates that pass the first rounds of the hiring process yet do not progress to later stages, you can offer modest yet lovely rewards such as permission to end the workday an hour early or a coffee gift card.

8. Referral Point Redemption Store

Launching a store where referrers can redeem points for prizes is one of the most practical employee referral rewards program ideas.

When going the non-cash award route, offering choices in prizes is one of the best ways to motivate and appeal to a wide range of employees. Plus, setting up a store is a way to streamline the reward distribution process. Examples of offerings may include nice headphones, standing desk convertors, and gourmet cookie assortments.

For more inspiration, check out this list of employee swag ideas.

9. Point System

Instead of merely rewarding employees based on the number of successful hires they generate, you can launch a point system that calculates bonuses based on desirable qualities in candidates. Introducing a point system is one of the most fun employee referral program contest ideas.

To run this tactic, gives employees a rubric of traits to look for. These qualities are not necessarily mandatory, just nice-to-haves.

For example:

  • Knows how to code
  • Speaks more than one language
  • Open to travelling often
  • Continued education
  • Awards

You can also include more informal options like “bakes awesome pies” and “sends quality work memes,” worth a point or two apiece. These silly-seeming qualifications can help applicants loosen up during the interview and can advertise the organization’s positive company culture.

10. Corporate Travel Programs

Travel incentive and employee referral programs can dovetail. Not every department has measurable quotas that lend themselves to performance-based travel rewards, so offering trips as a referral bonus makes these prizes more equitable, since any position can potentially find a worthy candidate.

Perhaps referrers get a weekend away at a spa resort, a winery tour, or a casino trip.

When offering trips or experiences as a reward, be sure to lay out the criteria for meeting the qualifications and earning the invite to the trip or party.

Check out this guide to corporate travel incentive programs.

11. Happy Hours

Holding hire-centric happy hours is a more dynamic approach than using a suggestion form. These events facilitate casual conversations that can help employers get a feel for potential applicants’ personalities before the interview process begins. Not to mention, sipping on craft beers and cocktails while playing games and chatting with other guests tends to be a more enjoyable experience than filling out forms and answering formal interview questions.

Simply rent out a bar or bring drinks into the office, then encourage employees to bring friends and connections to these events. You can host these gatherings as standalone or recurring events.

Here is a list of large group icebreaker games to play to get conversation flowing.

Conclusion

Employees can be one of your best recruitment tools. Your staff understands the company culture and the qualities required to succeed at the company. Chances are, team members have a network of past classmates, former coworkers, and members of social circles that is tappable for open positions. Running referral programs gives staff more autonomy in creating the work environment and shows that employers value team member’s opinions. Plus, while hirers typically make decisions based on mere hours of interactions, recommendation programs are a vetting process based on years of impressions.

Next, check out this list of applicant tracking systems.

FAQ: Employee referral programs

Here are answers to commonly asked questions about employee referral programs.

What are employee referral programs?

Employee referral programs are systems where current team members recommend friends and acquaintances for open positions and receive a reward in return. The purpose of these programs is to boost the number of qualified candidates in the hiring pipeline and produce vetted and vouched-for applicants for consideration.

What are some good employee referral program ideas?

Some good employee referral program ideas include alumni referrals, happy hours, and point systems.

How do you start an employee referral program?

To start an employee referral program, first decide the parameters and the rewards. Then, create a submission process. Next, advertise the program to employees. Finally, complete your hiring process and hand out rewards to referrers.

How do you promote an employee referral program?

To promote an employee referral program, use internal communications such as staff emails, notices on forums and bulletin boards, and announcements at company events. You can establish a routine of announcing open positions and reminding staff about the referral program during meetings to keep the system at the top of team member’s minds. Posting about the referral experiences on social media is also a good idea, especially if your program is open to non-employees as well.

P.S: Press "CTRL + D" or "Command + D" to bookmark this page for updates.

Share this article:

avatar
Author: Angela Robinson

Team building content expert. Angela has a Master of Fine Arts in Creative Writing and worked as a community manager with Yelp to plan events for businesses.

LinkedIn icon

Want to do team building online?

We have 30+ event types, and thousands of five star reviews.