Does your company reward an employee for referring someone who is hired?

Our industry requires significant training (medical reponse assistance and HIPAA laws). As a result we have a two piece referral bonus for our staff. People get $50 after the new staff member has been here for 90 days and then they get another $150 when the staff member hits 180 days.

I work for a public agency and yes, we do. Sadly, we've even awarded them to executives who hired their own relatives - in violation of public law!

In my private industry days, I was taught that such programs were counter productive to creating a diversified workforce: That birds of a feather tend to gather together. Thus, it was more likely that we would refer someone like ourselves. This not only creates issues with EEO, it robs the company of the breadth of ideas that come from employing a broad section of our community.

Besides, no matter how well intended, the perception by employees that one is hiring friends and relatives is a detriment to overall morale.

Because of this, we eliminated these referral rewards programs.

We (that being any company that I've been a part of) have never offered referral rewards.

If you as management have created a dynamic, inclusive, fun, exciting (fill in the positive verb) place of employment, employees would want to share that with their friends and relatives.

From that sharing, one would assume (a dangerous term) that referrals would happen. In essence, the company has already "paid" for the referral.

Referral bonuses work when you are hiring several bodies a month and you need specialized talent. It is much cheaper than paying recruiters and you generally have fewer question marks since someone knows what kind of employee you are getting. Controls are needed such as no bonus for hiring direct reports or relatives.

I've been with organizations that have offered some type of referral bonus. Senior executives are excluded from participating (they're expected to have connections / be well networked at that career stage). Depending on where you want to have the greatest impact, the program should be monitored and adjusted. Typically you want to target functions/positions with high turnover or tight labor market. At call center, we focused on the call center employees; at accounting firm, accountants and CPAs. The more senior positions, the longer the tenure to payout the full bonus (i.e. call center employees 3 months; accountants 6 months). Hires through referrals tend to have higher retention because of the psychological contract between the employee who recommended the organization and the friend / relative getting foot in the door. Hope this helps.

We do offer a referral bonus and doing an analysis of where most of our talent comes from it has been referrals. We do not stipulate any length of employment before paying the bonus however I see the value in that. I have proposed we do that in the past and the fear is no-one would refer anyone for fear of them not working out.

I think the length of employment requirement and no payout for referral of direct-reports have been key features in every adaptation I've seen.

We did at my former company. However, the executive team (of which I was a member) was not eligible, which I thought was the right answer.

We offer a referral program.
1. $1,000 per candidate hired;
2. Must be employed for 90 days
3. Cannot be a family member
4 Must be currently employed

We offer a referral program and are pleased with the results
when referred employee stays 90 days - $500
1 year - $1,000
for a total of $1,500 for an employee that stays with us for 1 year.

3/5/10k structure & 90 days