Starting an employee referral program

Written by 
Dr. Kristin Trostel

Starting an employee referral program

Teachers often network with other professional peers — and this gives them access to a large pool of potential candidates. Why not boost your candidate pipeline by implementing an employee referral program? These programs can significantly lower recruitment costs and increase employee retention.

Where to get started?

To begin, you’ll need to determine the goals of the program. We suggest spending the first year of your referral program gaining baseline data on the percentage of new hires that come from your program. From there, set incremental goals to increase that percentage over time. 

🔍 Research shows that if a teacher stays for three years, that teacher is highly likely to be with the district after ten. So when setting goals, consider focusing on what it takes to retain teachers through their third year. 

Design the process

Keep the process simple. Create a space where employees can share their referrals, and then track whether those referrals apply and are hired. For example, in Nimble, HR can maintain and track these referrals through the Prospects tab. The key information needed is their name, email, phone number, and any other details your employee cares to share. If the candidate does apply, be sure there’s a place for them to denote that they are a referral — for example, in Nimble, you can have them select Employee Referral Program on the “How did you hear about us” drop down. This will be beneficial data to inform your referral program's success.

💡Check out this referral policy from our partners at Hartford Public Schools, who started a referral program using ESSER funds to find great talent amidst pandemic-related hiring challenges.

Incentivize employees

The most common way to incentivize employees is through a one-time lump sum, paid out after the employee has stayed with the organization for a certain amount of time and has satisfactory job performance. Cash incentives range across organizations; we most commonly see $400 - $1,000, with the higher sums given to those who refer harder-to-fill roles such as Special Education.

However, there are other methods to get your current employees excited—for example, gift cards, employee recognition, a paid day off, or a raffle prize. The key is to get innovative!

Documenting and clearly communicating your process for your current employees will avoid confusion. When will the money be paid out, and what precisely qualifies as a referral? Does the new employee need to work for six months before the incentive is paid? Are all positions paid out at the same rate, or do harder-to-fill roles have a higher payout? 

Maximize the program

Encourage your employees to refer folks anytime and all the time, even if there are no current openings. You can highlight your referral program in newsletters, hold office hours with HR to answer questions, and ask principals to champion the program during their staff meetings. 

Communication with referrals is also vital; keep them warm through various outreaches. This might include district newsletters, emails from the recruitment team, invitations to district hiring events, etc. Consider how you can expedite referrals through the hiring process, while maintaining a process that is equitable and fair.

Refine with data

Once your program is up and running, evaluate its effectiveness by measuring success towards your goals. Data to consider include the percentage of applicants coming from referrals, the percentage of hires coming from referrals, and the percentage of applicants and hires for hard-to-fill roles coming from referrals. Check for areas of improvement or even quick wins that will bring minor enhancements, e.g., talk with the employees or principals with the most referrals to understand why they are so successful; you can then share these practices with others. Remember to continue to learn through data using Nimble’s data dashboards, refine your process, and celebrate your successes!

Dr. Kristin Trostel
Product Marketing Manager