Referral recruitment is a recruitment strategy that encourages employees to refer contacts for specific positions. It performs better than regular recruiting:
- Recruiting through 3rd-party recruiting agencies incurs a 20–25% agency finder's fee – which can top $25K for an employee with $100K annual salary. Referral recruiting can be free (or cost a fraction)
- Candidates hired through referrals tend to stay up to 3X longer than candidates hired through job boards and other.
- Employees whose contacts are hired tend to stay much longer, helping with overall employee retention.
There are disadvantages to putting too much emphasis on referral schemes, such as reduced workforce diversity and unfairness regarding other prospective candidates. To combat these disadvantages some companies are opening up their referral schemes to external contributors. Not only does this help to combat the aforementioned issues, but it also increases the size of the network of potential referrers.
Social referral recruitment program
Social referral recruitment program relies on the principle of co-option while allowing all the employees to recommend candidates to fill the company job offers.
It therefore allow the company to maximise employees address books on professional and social network such as LinkedIn, Facebook or Refer Me Please.
By sharing the company job offers to their contacts, the employees give to the company the opportunity to reach new pools of candidates and increase diversity.
The evolution of social networks and their diversity (professional, social) have expanded relationships that may have employees of a company.
Two circle of acquaintances appeared, the first reflects the old system based on cooptation i.e. friends, family, colleagues and the second less formal depends on the influence of the employee on social networks .
An employee shares a job offer through its various social networks, professional, and personal and generates relevant application for its company. It will be paid in case of recruitment of one of his candidates.