Referral Article

Topics: Employment, Human resource management, A Great Way to Care / Pages: 2 (382 words) / Published: Dec 11th, 2013
“The Pros and Cons of Employee-Referral Programs”
By David Hakala www.hrworld.com HRM 599: Human Resource Management Capstone

“The Pros and Cons of Employee-Referral Programs”
By David Hakala

The article titled “The Pros and Cons of Employee-Referral Programs” by David Hakala focuses on the idea of employee referred employment for a company. This concept has been used for decades to fill approximately 30% of positions within a company. In many cases there is a program already developed but it is both unappreciated and not a heavily supported function. In addition, when asked, current employees would give nonchalant answers such as “I will have to think about it, I don’t know.”

The general structure of such a program is that there is an associated monetary bonus for the employees who refer candidates for open positions. The monetary bonus would be received after the referred employee passed a 90 day probationary window. A number of companies will actually limit the monetary bonuses received for referrals for employs to a particular number per year. For the companies that do not offer a monetary bonus for employee referrals, there is an offering of products or services to be redeemed, specifically products or services that are commonly used.

In regards to employee-based referrals, it seems that the process should be more streamlined and has a more concrete structure. Offering monetary bonuses doesn’t seem like the best idea as it could motivate the current employees to suggest any random individual, rather that a solid qualified one. Instead of monetary bonuses, the companies should offer training to employees. For example a rare opportunity for a class that isn’t normally offered, it would encourage the employee to better themselves and the company they work for.

The employee referral program is also a significant way for companies to diminish large cost ways of



References: Hakala, D. (2013, October 20). The Pros and Cons of Employee-Referral Programs. Retrieved f rom HR World: http://www.hrworld.com/features/employee-referral-pros-cons-081208/

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