Creating a Powerful Employee Referral Network

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The saying goes that it’s not about what you know, it’s about who you know. And when it comes to getting hired, well, we’ve found that there’s some truth to that. Employee referrals continue to be the top source of hires for employers nationwide, accounting for more than 30 percent of overall hires in 2016. Yet despite that status, employee referrals tend to be unrecognized and underutilized as a genuine avenue for recruiting top job candidates. It’s time to correct that mistake.

Why You Should Utilize Employee Referrals

While they shouldn’t be your only source of hire (and we really doubt that would be possible anyway), employee referrals are one of the most cost-effective and productive methods of finding quality candidates for your open jobs. And the reasons for that are quite simple. So simple, in fact, that I’m going to skip the rest of the intro and go straight to them.

Reason #1: They Save Money

When you hire based on employee referrals, you end up paying far less in recruiting costs. You don’t have to worry about any potential paid advertising for job openings, nor do you have any agency fees to consider if that is one of the methods you use to fill open positions. Also, since they tend to speed up the hiring process (see Reason #2), you also save money on additional labor and any potential overtime you would have to pay your staff to make up for the extra time between the vacancy and the hire. When you’re not spending money on extra man-hours, you have more room in the budget for things like facility improvements, additional recreational activities for residents, better incentives for outstanding home care providers, and other things that make your senior living organization stand out from the rest.

Reason #2: They Speed Up the Hiring Process

In the world of senior living and post-acute care, an open spot on the floor or an empty slot on the schedule means more work for everyone else. This increases caregiver fatigue, often leading to burnout and unnecessary employee turnover. The faster you can fill a spot, the better. Hiring someone based on an employee referral can shave a considerable amount of time off of the typical hiring process. You don’t have to worry about posting jobs, gathering and reviewing applications, vetting your top picks, and so on. You simply get all of the necessary information from the referred candidate, interview them to make sure they are a good fit for the position and for the company, then bring them on board. On average, using employee referrals to fill open positions can cut time-to-fill by nearly 50 percent when compared to posting jobs on career sites and job boards.

Employee referrals even speed up the onboarding process. Since they already know someone in your community, referrals integrate into your organization much faster than someone hired through a traditional job posting.

Reason #3: They Lead to Better Hires

Hiring faster? Fantastic. Hiring cheaper? Even better. But the real test of whether or not employee referrals are a viable option for your recruiting efforts lies in the quality of the hire itself. And when it comes to that, we’ve got some good news.

recent study confirmed that employees hired as a result of a referral tend to stay longer than hires made through careers pages or job boards. This is likely due to the fact that the employee referring the candidate has already determined whether or not they will be a good fit for the company. Also, the new hire comes into your organization with a sense of familiarity that other hires may not possess. They’re comfortable right out of the gate. They’re more engaged from the start.

As if that wasn’t enough of a retention boost, a successful referral often leads to the referring employee staying longer as well, since they feel like they contributed to the organization and are more involved. (+1 for unintentional employee engagement!)

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Getting Your Employee Referral Network Started

We know; you’re convinced. Now you just need to know how to get this whole “referral network” thing going and working for you. While there are many different methods to get a project like this up and running, there isn’t necessarily a right way, a wrong way, or even a best way. However, we can give you a few tips on how to implement this proven recruiting method.

Tip #1: Identify the Jobs Best Suited for Employee Referrals and Internal Hires

You know your jobs better than anyone. Some positions in your organization are typically harder to fill than others. Maybe certain jobs involve a skillset that isn’t prevalent in your area. Maybe the competition for that type of caregiver is uncommonly high where you live. Regardless of the reason, your hardest-to-fill jobs should be the primary focus of your referral efforts. That’s where you’ll save the most time and money on more traditional recruiting methods.

Tip #2: Expand Your Social Horizons

The easiest way to turn your employees into recruiters is to make it easy for them. Make sure your job posts are shareable through social media channels (Facebook, Twitter, LinkedIn, etc) and email. If your employees have a link they can share or send with a click, they are far more likely to do so. Considering the average social media user has 350 connections, that’s free exposure to your job posts that even some of the best job boards can’t provide.

Tip #3: Keep Track of Employee Referrals Through Your ATS

You have hiring software — use it. Keep track of both referring and referred employees with your applicant tracking system. If it includes some kind of tagging feature — like the one used by the Roster program supported by HealthcareSource Senior Living™ — this would be an excellent way to use it. That way, not only can you record how many of your hires were the result of an employee referral, you can also determine which of your employees are the best sources of quality candidates and hires. And don’t forget to update the employee who provided the referral even if you don’t end up hiring the candidate they referred. Forgetting to close the loop may make them feel like their efforts were not valued. Remember — what gets recognized often gets repeated.

Tip #4: Offer Incentives for Both Referrers and Referred

Never underestimate the power of a reward. Many companies see an uptick in employee referrals when they offer some kind of reward. For instance, you could offer a cash bonus for both the referrer and the referred employee once the new hire reaches the 90-day mark. (It would be a shame to reward anyone for contributing to your new hire turnover rate, after all.)

Tip #5: Start Earlier Than You Think

When should you start looking for possible referrals to add to your applicant pipeline? How about during onboarding? As part of your onboarding process, ask your new hire if they know anyone they would recommend for a position within your organization. When something opens up, you will have a list of recommended candidates ready to go without having to make any extra effort to obtain it.

Tip #6: Be the Kind of Company Your Employees Want to Share

After all, if they’re happy with their job, of course they’re going to want their more-than-capable friends and former coworkers to come work alongside them.

These days, many hiring software programs, including HealthcareSource’s senior living talent suite, have built-in methods to utilize referrals from current employees. Don’t overlook this valuable resource in favor of more traditional methods. Your residents and clients deserve the best, regardless of how you find them. Don’t leave any doors unopened — particularly when they’re as proven and cost-effective as this one.


Ryan Haddock

About Ryan Haddock

Ryan Haddock is a Marketing Manager for HealthcareSource, focusing on the company's senior living and staffing solutions. As a marketing manager, Ryan helps connect providers with a software platform that will help them hire, keep, and grow the right people. When he isn't scrawling plans onto white boards or tapping away at a laptop, Ryan enjoys reading, writing short stories, and spending time with his wife and three boys.