3 Cheesy Keys to a Killer Internal Referral Program!

April 22, 2021

The number one factor for driving internal referrals is being a great place to work. No amount of tinkering or money will fix a ruined leadership reputation, a broken business model or a toxic culture. Running a great workplace takes inspired leadership, great character and constant communication. If your organization is a respected workplace where the staff is grateful to be there, you’re ready to build a thriving internal referral program. Here are three easy (and cheesy) keys to making that happen:

When in Doubt, Pay it Out!

It’s an incentive program! It should create interest, excitement and joy. Too many HR leaders treat their employee referral program like it’s a public assistance fund in need of rigorous defense against fraud. There’s certainly a place for constructing a clear and consistent process, but if you find yourself thinking first about compliance, and second about getting your staff excited, then you’re probably missing opportunity.  

Prioritize positive reward over compliance. In fact, if your process leaves you unsure about whether a referral was legitimate, pay the bonus! Consider the consequence of the wrong decision either direction. If there was not a true referral, but you pay it anyway, you‘re still creating positive buzz to refer people. Sure, there’s a risk of someone gaming the system. But compare that to the far worse outcome of not paying an employee who made a true referral! Even if they did mishandle the process, they did the thing you’re trying to encourage. They referred a friend! And now you’ve potentially sucked the positive energy out of the whole program. Also, an employee who was truly robbed of a due reward is far more likely to advertise their disappointment than a cheater is to advertise getting over on the system. 

When in doubt, pay it out! If your process makes it hard for true referrals to be recognized, the process is wrong, not the employee making the referral. Go out of your way to find ways to honor the referral that is claimed. Was there a text exchange? Is there an email trail? Do both people agree? Accept that in place of the “required form” or whatever your standard process is. In fact, if you find out someone referred someone, but didn’t know about the bonus or the process, pay them! Remember, you’re advertising. This is about getting staff to pay attention to personnel needs in the future. 

A Program of Praise that Also Pays!

If financial bonuses are the logs to keep the referral fire burning, then public praise is the gasoline to make it rage in a captivating way. Here are a few ideas to turn up the heat on your program:

  1. Honor referral bonus recipients in staff meetings. Have the CEO or the VP of HR shake each person’s hand and congratulate them.
  2. Write thank you letters by hand. A note from one person to another is personal. This creates a feeling of genuine appreciation.
  3. Post praise to your company newsletter or intranet. Add pictures, a note from a leader or from one of the hiring managers who benefited from an employee referral. 
  4. Showcase a success story in depth with a video. Ask the manager, the referring employee and the new hire about their experience and the impact on them. It doesn’t need to be a high-quality production. Do it for free on your smartphone. 

Varying Rewards is Very Rewarding! 

There’s something habit-forming about trying to figure out an algorithm that isn’t perfectly consistent. Games on your phone, social media, and marketers the world over use varying rewards to hook audiences with curiosity. 

There’s no rule or law that says a referral bonus for every job has to be the same. Mix it up, and make sure you communicate it clearly. One easy tactic is to enter successful referrers into a drawing for something big on some regular interval.

You can tier bonuses based on the difficulty of filling the job demand. But it can be fruitful to occasionally throw in a wild card that’s disproportionately higher. When you inject an outlier, it keeps it interesting. Sometimes an easy win can make for a great story. And everyone loves to talk about a great deal!


Submitted by:

Aaron Davis is the founder and CEO of Recless Tech, an external referral platform that uses peer-to-peer sourcing to fill tough technology positions. He has previously served as the COO for a software services firm, the Talent Acquisition Director for a large health plan, and an account executive for a large tech staffing firm. He is a Senior Professional in Human Resources, a Certified Scrum Master and holds an MBA from Wright State University.

[email protected] 


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