Employee Referral Bonus

[vw_rabbit2.5]

Has anyone gotten an employee referral bonus lately? I almost feel like it hurts the candidates chances. I've tried to refer a friend/relative twice now, and they don't even get interviews. I'm thinking that with so many candidates/applications, why would a company want to pay out a referral bonus if they can just hire someone else.

I'm thinking of referring another friend, but won't go through the referral form and just forward on the resume to the manager, as I think the referral bonus might hinder their chances of getting interviewed.

What does everyone think? If your company has a referral bonus program, would you take advantage of it, or would you risk hurting your friend's chances?

[Disoblige]

It shouldn't hurt your friend's chances.

Some companies offer a referral bonus program throughout and some are role specific. The role specific ones are because the role is hard to fill, and typically the referral bonus doesn't get paid out until "x" amount of time the hired person stays employed for. So the company typically should not care.

[Type_S1]

Referrals help at most companies. If you are a bad employee maybe your referral hurts but in general companies want people who have be vouched for.

[ee2k]

Those you referred were likely not the right candidates for the job. A referral does not guarantee an interview.

Since you're wondering, let me ask this: are you a high performer at work where your referrals can be taken seriously? Or do you slack off, are not in line with company culture and performance goals, and perhaps your referrals are not being valued?

[cgyITguy]

Most referral bonuses are only a grand or two. Shouldn't break any company's bank. Most aren't paid out until the candidate has worked 6 months or so. Given the high cost of training and high turnover, I doubt this would be an expense ever considered as a negative

[buh_buh]

The cost of a referral bonus is much lower than the potential cost of hiring an unknown commodity.

[NoPulp]

The referral bonus at my company is relatively small, the cost doesn't hurt them at all if it means a better chance of getting someone decent. It's in their interest to hire people that are referred, but the person still needs to be a good fit for the position and isn't a guaranteed thing.

I recently referred a cousin, but his resume sort of indicated he was more interested in another industry. I don't think they contacted him, but at least I tried.
I would still refer your friend if you think they'd be a good fit.

[holden]

Who do you think is filtering out your referrals, HR? I don't think the referral payout affects their bottom line, so it wouldn't matter to them anyways. Unless it's a really small company where the person hiring is also watching the budget, it shouldn't make a difference. It's just a corporate expense.

[dj_rice]

I've referred two people. Got $500 on each referral and they still work here a few years later.


I work in the automotive dealership world, referrals are preferred more vs random's applying. When we put an ad on Kijiji, the people that would come and apply for certain positions and how they were dressed, some literally looked like they rolled out of bed boggled my mind especially when applying at a luxury brand dealer.

[bjstare]

Originally posted by buh_buh
The cost of a referral bonus is much lower than the potential cost of hiring an unknown commodity.

If they were a referral and didn't get hired, they simply weren't the right person. Or they were competing with a bunch of other referrals, in which case your point is moot. Almost my whole team was referrals (at a company with referral bonus), and when they interviewed, all their competition was other referrals. I don't think we interviewed a single person who wasn't a referral for that round of hires.

[spikerS]

Originally posted by dj_rice
I've referred two people. Got $500 on each referral and they still work here a few years later.


I work in the automotive dealership world, referrals are preferred more vs random's applying. When we put an ad on Kijiji, the people that would come and apply for certain positions and how they were dressed, some literally looked like they rolled out of bed boggled my mind especially when applying at a luxury brand dealer.

I hear that. Every single job that I applied for and got an interview, I showed up in a suit and tie. It was crazy how many job offers I got simply because of that. It showed I was taking it seriously.

I remember one job interview, to work in a warehouse. By dressing smartly, not only did I get the job, but I was given a higher salary because of it.

[NoPulp]

I notice the interview attire a lot at my work. I understand these people are interviewing for a welding or assembly line position, but cmon... at least wear a collared shirt and clean jeans.

[botox]

Bottom line is that you are not going to refer someone you think is a lazy shit because your reputation sits on it. Sure you're not going to lose your job if your referral ends up not working out, but it looks bad on you and nobody wants that to happen. HR likes referrals cause less work for them cause you already did their work for them and are usually good and you get some $$. Win Win.

[dj_rice]

Originally posted by NoPulp
I notice the interview attire a lot at my work. I understand these people are interviewing for a welding or assembly line position, but cmon... at least wear a collared shirt and clean jeans.

We had one guy, came in a trench coat. Half a wolf/moon t-shirt on. Hair was a mess. And he handed in his resume on a small cue card. Just had his contact info, and 1 or 2 previous job info on it and that was it. Not sure how he expects to get hired anywhere.

[Kloubek]

I don't believe it is a detriment.

I was the one who suggested a referral bonus at my company, and it has worked reasonably well since we put it in place. Half my team came from those referrals, and there was only one referral I hired who didn't work out.

I would much rather have the added layer of accountability to the referring family member/friend and pay for it, rather than have to re-train someone who didn't work out. It is always a crap-shoot going outside your company. The one you employ will also generally know someone else's word is on the line if they don't work out - and sometimes that gives the person a bit of a kick in the butt to do well.

But not always. I do notice that you sometimes end up with referrals who are only given a "foot in the door" from it, as opposed to truly being right for the job. I guess that's the manager's job to work that out but it can be challenging to uncover a candidate's suitability since they generally tell you whatever you want to hear anyway.

[flipstah]

I know one person that got hired through employee referral: Me.

[Euro838]

Any referral bonus that a company would pay out to an employee is way less than if the company hired the person through a recruiter. Typical recruiter costs are 20-30% of the hired person's salary!