How To Automate The Employee Referral Process

According to Silkroad, employees referrals are still the top source of hire at 30% of all hires. With the market getting even tighter, leveraging referrals is more important than ever.

Your current employees are likely to know people who would be good fits for roles you need. When a referral program works well, recruiters are a lot less stressed.

Why don’t more companies use referral programs?

The main reason is that referral programs are time-consuming.

At a RecruitingDaily event in Atlanta, the consensus among recruiters was that while referrals are an effective channel for them, it can take up to 70% of their time in a given week to manage it.

That means other tasks, and candidates from other channels, fall through the cracks.

The other major reason is money. Companies can be cost-averse and don’t always want to offer monetary incentives to current employees for referring new employees.

Fixing the time issue through automation

We could automate the referral process. It would work something like this:

1. A job opens up.
2. A job link is generated relative to whatever ATS you use.
3. An email is triggered to all employees explaining the job with the link to it and any referral incentives.
4. As the candidates they refer use that link to come into your hiring funnel, AI software screens their credentials instantly to see if they overlap with position responsibilities.
5. If they overlap well, it goes to the recruiter for a group to present to the hiring manager.
6. If there’s no overlap, another auto-generated email can kick back to the employee who referred the candidate asking for more clarification.
7. The recruiter now has a bunch of pre-screened referred candidates.
8. AI can then further review that group of candidates and help determine whom to present to the hiring manager.

The workflow takes a little bit of time to set up, but once it’s set up, now you have a referral process that isn’t massively time-consuming and get you quality candidates to interview or present to the hiring manager.

Tech should help you save time, not increase the amount of time on projects. That’s how AI can help with referrals and higher candidate quality.

Solving the money issue of referrals

Here’s one system that’s been proposed:

You create a ticket system.  Every time an employee refers someone and they get an interview, that employee gets 1 ticket. If the candidate is hired, the referring employee gets 50 tickets.

Each year, you put up $100,000 towards this program.

Once a year, you pull five tickets — and each of them gets $20,000. The more referrals you’ve done (and the more successful ones), you have a greater chance to win $20,000.

Unless you’re a pre-existing executive, $20,000 is a sizeable bonus at most companies.

Some might balk at giving $20,000 off random lottery from referrals, but this is important. It says “We care about you wanting to surround yourself with the best people possible to grow us all together” and it also says “We will reward that caring.” Those are both very palpable messages to be communicating to employees.