If like a significant number of employers you find it a challenge to source the right calibre of personnel for your business and have exhausted all the traditional avenues such as advertising, recruitment consultants and social media, there is another initiative you may wish to try.
Employee Referral Schemes have become increasingly popular UK-wide and, says the Institute of Personnel and Development, 47% of UK companies run them.
How Employee Referral Schemes Work
The schemes work by encouraging employees to refer potential candidates for vacancies. In exchange for a successful introduction, they are rewarded either with a financial bonus, or other benefits such as additional holiday.
One of the key benefits of Employee Referral Schemes is that they are less costly than traditional recruitment methods. Additionally, employers tend to find that new team members recruited through this avenue will be especially motivated to perform to the very best of their ability as they will be mindful of how this will reflect on the person who referred them.
Advantages & Disadvantages
And then there’s the fact that new recruits that join a business through employee referral are likely to need a shorter settling in period because they already know some of the existing team.
When an existing employee discusses a referral with a potential candidate, they are always going to give them an honest view of the company that could become their employer. This will start the new recruit off on a good footing as their expectations will be realistic.
So far so good but, as with anything, there will be disadvantages. Firstly you have to consider what would happen if things do not work out with the new employee, and how that would affect the relationship between you as the employer and the referring member of staff. Employee Referral Schemes can also limit the flow of fresh ideas into the business because referrers and referees will tend to be like-minded.
What Makes a Good Scheme?
The best Employee Referral Schemes are well thought through so they catch employees’ attention. Finding out what employees really want in return for referrals is essential: Cash? Days off? Gift vouchers? Of course what you offer needs to be cost effective.
Keeping the scheme simple is also important. If it’s not understood, employees won’t engage with it. You’ll also want to keep its administration straightforward too so that it doesn’t drain your resources.
So you have your scheme, now you need to tell your staff about it. The more reminders they have, the better. So aside from an initial email, fix posters in the kitchen, by the water cooler and anywhere else they tend to gather. Encourage them to use their social platforms to network any vacancies. LinkedIn is probably the most effective, but Facebook and Twitter can be just as good.
And finally, once there has been a successful referral, make sure everyone knows about it. This will serve to inspire others to do the same.
If you’ve been thinking about introducing an Employee Referral Scheme into your business and would like to discuss in more detail how it would work in practice, why not approach your local bookkeepers for advice?