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Referral Program - Enterprise

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Business Case for enterprise-wide employee referral program

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Referral Program - Enterprise

  1. 1. Enterprise Employee Referral Program Proposal August 2008
  2. 2. Table of Contents <ul><ul><ul><li>1. Referral Statistics </li></ul></ul></ul><ul><ul><ul><li>2. Strategies/Best Practices </li></ul></ul></ul><ul><ul><ul><li>2. Bonus Payout Overview </li></ul></ul></ul><ul><ul><ul><li>3. Process Steps </li></ul></ul></ul><ul><ul><ul><li>4. Policies, Terms & Conditions </li></ul></ul></ul>
  3. 3. Employee Referral Statistics <ul><li>Time to Fill </li></ul><ul><ul><li>Employees selling the company to candidates and typically refer those that are ready for a job change resulting in less time searching & screening </li></ul></ul><ul><li>Impact to Turnover </li></ul><ul><ul><li>Employees hired through referrals have a 25% higher retention rate than those hired through other sources 1 </li></ul></ul><ul><ul><li>Could result in up to $44M in savings 2 </li></ul></ul><ul><li>Percentage of Hires Coming From Referrals </li></ul><ul><ul><li>Referrals are 54 times more likely to result in a hire than from job boards 3 </li></ul></ul><ul><li>Impact to Cost-per-hire </li></ul><ul><ul><li>Referral costs for an exempt employee equal $500 and up to $3k for print advertising </li></ul></ul><ul><li>__________________________________________ </li></ul><ul><li>1 Source: Workforce Management & Ohio State University </li></ul><ul><li>2 Based on projected annual voluntary turnover rates (19%) and an average salary of $40k; cost of turnover is estimated at 150% of employees annual salary </li></ul><ul><li>3 Source: ERE.com; November 28, 2006 </li></ul>
  4. 4. Employee Referral Best Practices <ul><li>Below are concepts on how we can establish a successful program now and in the future. Most can be supported by Vurv or our Career Portal. </li></ul><ul><li>Public recognition of successful referrals </li></ul><ul><ul><li>Announce referrals during Safety meetings </li></ul></ul><ul><ul><li>Post referrals on intranet with listing of job filled (future) </li></ul></ul><ul><li>Pay the bonus rewards promptly </li></ul><ul><ul><li>Paid immediately after new hire starts – no longer than 90 days </li></ul></ul><ul><li>Offer bonus payouts that are significant </li></ul><ul><ul><li>Payouts can also range based on level, business need and volume </li></ul></ul><ul><li>Regular promotional incentives </li></ul><ul><ul><li>Prizes for employees who refer the most candidates </li></ul></ul><ul><li>Converting from passive to proactive tool </li></ul><ul><ul><li>Solicit referrals regardless of openings </li></ul></ul><ul><li>Creative devices to enhance employee participation </li></ul><ul><ul><li>Consistent communication highlighting the business critical positions </li></ul></ul>
  5. 5. Bonus Payout Overview <ul><li>Payouts based on function/level </li></ul><ul><ul><li>Tier 1: $1000 for hard-to-fill positions (i.e. VP level & above; IT roles) </li></ul></ul><ul><ul><li>Tier 2: $500 for Exempt/Professional level </li></ul></ul><ul><ul><li>Tier 3: $250 for Non-exempt (i.e. Admin, Hourly & Entry Level) </li></ul></ul><ul><li>For business critical positions, Hiring Manager reserves the right to offer any referral bonus amount he/she deems appropriate to generate candidates </li></ul><ul><li>Bonuses to be paid out on first pay period following the 90 days after new hire starts </li></ul>
  6. 6. General Process Steps <ul><li>Recruiter, HR, Hiring Manager communicates referral program to new hires during orientation and/or training </li></ul><ul><li>Recruiter sends welcome email to New Hire and solicits referrals within first week </li></ul><ul><li>Recruiter schedules focus group to allow employees to ID warm leads – focus groups can be based on job function or business unit </li></ul><ul><li>Online application form (filled out by referred candidate) must be completed and include “employee referral” on candidate source and the name of the referring employee. </li></ul><ul><li>Reports are run out of Vurn to show name of new hire and referring employee. Payroll is contacted by Region HR for distribution of payment </li></ul>
  7. 7. Policies, Terms & Conditions <ul><li>ProBuild employee groups eligible to participate, but not eligible for bonuses: </li></ul><ul><ul><li>Human Resources </li></ul></ul><ul><ul><li>VP level and above </li></ul></ul><ul><ul><li>Contractors or Consultants – anyone onsite at ProBuild being represented by 3rd party employment or consulting firm </li></ul></ul><ul><ul><li>Managers/supervisors when referring someone w/in their own groups </li></ul></ul><ul><ul><li>Employees that leave the company prior to the referral bonus payment date </li></ul></ul><ul><li>The following candidates will not qualify as a referred candidate: </li></ul><ul><ul><li>Internal employees </li></ul></ul><ul><ul><li>Contractors currently working onsite at ProBuild in any capacity </li></ul></ul><ul><li>Other Policies: </li></ul><ul><ul><li>Referred candidates must be submitted directly to the Recruiter or a representative of the Recruiting team prior to being hired. </li></ul></ul><ul><li>Bonus amount comes out of Hiring Manager budget </li></ul><ul><li>Bonus payment will not be made if another fee (e.g. employment agency fee or temporary agency conversion fee) is required to be paid by ProBuild </li></ul>

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