Employee Referral: Employer’s Source of Best Hires

June 21, 202112:43 pm2911 views
Employee Referral: Employer’s Source of Best Hires
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What makes employee referrals the best source for hiring? Let’s first look at its history.

Around the 4th century B.C., there were a lot of jobs to be filled in the Roman army, yet there were not enough candidates and many were poorly qualified. Staffing an army was not easier back then, but the Romans needed a consistent pool of soldiers and other support staff like carpenters, doctors, and engineers to keep the army going. 

In 55 B.C. Julius Caesar offered a reward of 300 Sestertii to any soldier recruiting another into the Roman army. A reward is even payable on the death of new recruits within the first three months. Decimation and other factors ensure high involuntary attrition rates keep rewards high. It, therefore, is believed that the first employee referral was done by Julius Caesar. The method that Caesar used is then declared to be the earliest documented portion of the referral bonus in the history of the world. It is interesting because it was used for the hardest job in the world to recruit people to join the army. 

Years later, the corporate worlds face the same set of problems as Romans in recruitment. And thus, employee referrals continue to be used as effective talent sourcing and hiring. According to 2021 ERIN’s Employee Referral Statistics, eighty-two percent of employees rated employee referrals above all otter sourcing options to yield the best ROI. Employers can also save greatly from their sourcing cost and talent’s productivity. Employees hired from referral programmes are also 45 percent more loyal for longer than 4 years, while 25 percent of employees sourced through job boards stay for over 2 years. 

Another survey showed that referrals are the most popular hiring source for companies independent of company size and age. Emerging trends include external referral programmes and experimental non-cash rewards. Most companies opted for a simple cash reward with a median referral reward of $2,000 while fifty percent of companies offering a referral reward also offer a ‘hot job’ bonus for hard-to-fill or urgent roles. In short, employee referral programmes are not only good for employers, but also for employees. 

Brilliant employee referral programmes to implement  

Many companies are now enabling employee referral programmes to get the best talents in a short time, at an efficient cost. However, as employee referral is on the rise, so does the competition between employers. Among the reasons is because Millennials and Gen Z, the biggest generations in the workforce today, develop a hustle culture and hold multiple jobs at once.

U.S. Census Bureau researchers disclosed that the percentage of people working multiple jobs increased between 1996 and 2018. The researchers found that 7.2 percent of people aged 16 and older in the U.S. were multiple jobholders as of the first quarter of 2018. Furthermore, the researchers found that the rate for females holding multiple jobs increased more than the rate for males. The rate for females holding multiple jobs increased to 9.1 percent from 7.5 percent, while for males, it rose to 6.6 percent from 6.3 percent between 1996 and 2018. 

Needless to say, employers should compete to provide the best employee referral programmes, such that their employees do not refer their friends and/or families to other employers. Ideally, every referral programme includes incentives, ease of use, feedback, and recognition. But to make it more appealing, here are some brilliant ideas to ensure employee referrals are on your side: 

  • Cut-to-the-chase. This strategy requires your new hires, who have made it through his/her first weeks at the company, to refer friends or family. This strategy has two main benefits: it instantly leads to more referrals and it emphasises the importance of referring. 
  • Recruitment happy hours. You only need to hold get-togethers where employees can invite the people they want to refer to. It is a great, informal way for recruiters to get acquainted with potential candidates, while having a fun time for both employees and their referrals. 
  • Provide a specific incentive. You can come up with a country and culture-specific incentive to reward employees who are able to bring in referrals. 
  • Gamification. Holding contests and showcasing a leadership board will drive competition and help your companies gather a higher quantity of referrals. 
  • Straightforwardness. At Google, one of the things recruiters do is ask employees questions like “who is the best software developer you know in Boston?” Asking this kind of question pushes people to think just a bit harder about the people they can recommend. 
  • Do good, reward good. You can also offer your employee referrals to donate half of their bonuses to a charity of their choice under their name. 

See also: 5 Employee Referrals Trends Companies Would Need to Know

Employee referrals tools to use 

Employee referrals can happen organically through the built-in module in an ATS system or through the traditional hiring method. To make the matter faster, however, employers usually need to partner with a dedicated employee referral tool in order to boost the number of referrals they are getting, manage tracking, rewards, etc. 

There are plenty of employee referrals tools out there, but here are some of HR in Asia picks: 


  • Best for: Companies of all sizes 
  • Free option: Yes
  • Price: Start at $500/month

ERIN is categorised as a new entry to the referral software world; however, the app already has thousands of employees using its system across small to large companies. ERIN allows your company to streamline employee referral processes through an intuitive mobile-first tool. Employees can easily sync their network to the platform to get a referral recommendation. As ERIN is a mobile-first solution, it is great for all types of referrals. 


  • Best for: Companies with more than 500 employees
  • Free option: N/A
  • Price: N/A

Employeereferrals.com is more than a tool because it provides a consulting basis to get everything up and running and to make sure its clients’ referral hires increase significantly. Employeereferrals.com hooks into various ATS’s and rewards programmes. 


  • Best for: All organisation sizes, but specifically great for those that already use Slack intensively. 
  • Free option: Only able to create a free account and get the first 3 referrals Free 
  • Price: Start at $10/month

Drafted started as a marketplace that allowed anyone to refer people to a given company. They morphed into a referral tool that allows recruiting teams to source from an employee’s network. A key strength of Drafted is their matching algorithm which has mapped over 40k jobs, translating to better referral suggestions to employees. 


  • Best for: All organisation sizes, including startups, fast-growing companies, and established enterprises. 
  • Free option: N/A
  • Price: N/A

Boon has an ease of use solution to increase referrals through its gamification layer. Boon builds their own tech to boost referrals and thought that others would get value out of the system. Therefore, they make it public and collaborate with numerous enterprises and SMEs. The unique point of Boon is that the tool is not only a solution designed for fast-growing tech companies, customers can recruit everyone from engineers to truck drivers. 


  • Best for: Companies of all sizes 
  • Free option: N/A
  • Price: N/A 

Teamable is considered a pioneer in using employee, alumni, or advisor networks to boost referrals. The tool allows its users to recruit team and source talents who are already connected to your company. Teamable has a lot of data on potential referrals, as well as being great at handling and implementing their data to yield a great solution for referrals across your organisation. 

Read also: How to Create a Successful Employee Referral Programs

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