We are independent & ad-supported. We may earn a commission for purchases made through our links.
Advertiser Disclosure
Our website is an independent, advertising-supported platform. We provide our content free of charge to our readers, and to keep it that way, we rely on revenue generated through advertisements and affiliate partnerships. This means that when you click on certain links on our site and make a purchase, we may earn a commission. Learn more.
How We Make Money
We sustain our operations through affiliate commissions and advertising. If you click on an affiliate link and make a purchase, we may receive a commission from the merchant at no additional cost to you. We also display advertisements on our website, which help generate revenue to support our work and keep our content free for readers. Our editorial team operates independently of our advertising and affiliate partnerships to ensure that our content remains unbiased and focused on providing you with the best information and recommendations based on thorough research and honest evaluations. To remain transparent, we’ve provided a list of our current affiliate partners here.

What Is Referral Recruitment?

By Melissa Barrett
Updated May 17, 2024
Our promise to you
WiseGeek is dedicated to creating trustworthy, high-quality content that always prioritizes transparency, integrity, and inclusivity above all else. Our ensure that our content creation and review process includes rigorous fact-checking, evidence-based, and continual updates to ensure accuracy and reliability.

Our Promise to you

Founded in 2002, our company has been a trusted resource for readers seeking informative and engaging content. Our dedication to quality remains unwavering—and will never change. We follow a strict editorial policy, ensuring that our content is authored by highly qualified professionals and edited by subject matter experts. This guarantees that everything we publish is objective, accurate, and trustworthy.

Over the years, we've refined our approach to cover a wide range of topics, providing readers with reliable and practical advice to enhance their knowledge and skills. That's why millions of readers turn to us each year. Join us in celebrating the joy of learning, guided by standards you can trust.

Editorial Standards

At WiseGeek, we are committed to creating content that you can trust. Our editorial process is designed to ensure that every piece of content we publish is accurate, reliable, and informative.

Our team of experienced writers and editors follows a strict set of guidelines to ensure the highest quality content. We conduct thorough research, fact-check all information, and rely on credible sources to back up our claims. Our content is reviewed by subject-matter experts to ensure accuracy and clarity.

We believe in transparency and maintain editorial independence from our advertisers. Our team does not receive direct compensation from advertisers, allowing us to create unbiased content that prioritizes your interests.

Often, businesses offer payment to employees who recommend qualified applicants. This form of referral recruitment has existed for decades but has become much more successful with the advent of social networking. Today, some organizations hire over half of their new employees from these types of programs. The success of this type of program, however, sometimes comes with unanticipated outcomes.

The costs of employee referral recruitment initiatives are generally much lower than traditional recruitment methods. While referrers are paid for each hire, there is no money wasted in broader types of advertising. In short, there is a guaranteed hire for each payment made.

The quality of potential employees and the likelihood that the individuals will be good fits for the business is frequently much higher with referral recruitment. In essence, these candidates have already been through a prescreening. The referrer usually knows the prospective employee and has shared firsthand information of the position with him or her. As the referrer also has intimate knowledge of job, he or she is in a good position to recommend applicants who are truly qualified.

Referral recruitment programs can be powerful tools in certain situations. Businesses with high turnover rates or rapidly growing organizations can benefit from the influx of new leads. In addition, organizations with low employee morale often can improve employee relations by hiring new workers with established relationships with the existing workforce.

These kinds of programs are not without their negatives. Problems can occur when employees with outside relationships bring personal issues into the workplace. Likewise, cliques can rapidly develop among groups of these workers. This often causes other staff to feel excluded and lowers morale.

Ill-managed referral recruitment programs come with their own sets of problems. Those programs that allow unlimited referrals, for example, may find themselves overwhelmed. Frequently, an employee will inundate a human resource office with stacks of resumes, seemingly from every person who that employee knows. As it is unlikely that all, or even most, of these referrals are qualified for the position, this flood of applicants serves only to waste a human resource manager’s time.

Programs with exceptionally high referral bonuses encourage this type of overparticipation. In addition, programs that pay bonuses equivalent to half or more of an employee's monthly salary can expect drops in performance as it becomes more profitable for a worker to recruit than to do his or her job. Conversely, referral recruitment programs with low payouts may be largely ignored.

WiseGeek is dedicated to providing accurate and trustworthy information. We carefully select reputable sources and employ a rigorous fact-checking process to maintain the highest standards. To learn more about our commitment to accuracy, read our editorial process.
Discussion Comments
WiseGeek, in your inbox

Our latest articles, guides, and more, delivered daily.

WiseGeek, in your inbox

Our latest articles, guides, and more, delivered daily.