• James Fatherley

How employee referral schemes can help you get a head

As we try to return to normal, who would have thought that recruitment would be a struggle at the moment- for SMEs and larger businesses alike.

Businesses have been left with a void of staff shortages across many sectors- and some vacancies just aren’t being filled for months on end, leaving businesses under-resourced and overworked.

Recruiters are doing their best, but with so many positions vacant, it’s not easy. The number of open positions in the UK exceeded an unprecedented 1 million for the first time in August this year.

Now, more than ever, SMEs are realising the true value in recruiting by utilising in-house knowledge and contacts via their very own employees. By inviting your people to recommend someone they know for a position, HR teams save time and money on recruitment costs and from sifting through applications.

The referring employee gains the invaluable knowledge that their company trusts their recommendation, a position is filled, and you’ve got a new hire that someone internally has vouched for- which in this climate, is a winning scenario all-round.

So, what is ERS and how does it work?

An ERS is an internal scheme, where the company allows for existing employees to refer people they might know (such as ex-colleagues, maybe LinkedIn contacts) to apply for a vacant position. If the person that the existing employee refers is successful and the vacancy is filled, organisations usually offer the employee who referred the new hire a reward of sorts. This is usually a financial incentive; and can often be linked to seniority of the position or the need of the business. For further guidance on setting up such a scheme feel free to reach out to the team at Digital HR Ne.

What are the benefits of an employee referral scheme?


Getting your staff involved in helping with recruitment saves spending on recruiters and agencies who have specialist knowledge but can sometimes be costly. Often, the cost of financially rewarding an employee who successfully refers an applicant for a role is much less than incurring the cost of an agency, particularly if you’re advertising for specialist roles.

Save time

By managing this side of the recruitment process in-house, you’re potentially speeding up the recruitment process by a considerable amount – and saving yourself valuable time that could be spent more productively, rather than sifting through piles of CVs and applications provided by, for instance, third-party recruitment service providers.

Internal insight

Your people know your company values inside out- they understand the way things are done within your organisation and what type of person would fit in well within existing teams. With that unique vantage point, they’re unlikely to refer someone who doesn’t fit the bill. After all, if their referral gets selected for the job, it puts the referring employee in a good light, too.

Although recruitment agencies can be very useful, in many cases it’s your own people who understand your business and the skills, experience and aspirations of their own friends and family. Who better to find great people who are also great fit for your team and the roles you're looking to fill?

Employee involvement

Valuing people’s judgement and opinion and rewarding them for it with a bonus or another incentive? Win/win. This display of trust in your team’s ability to understand what the business needs and to fill a vacancy will make your team feel particularly engaged. If employees know that their recommendations for vacant positions are taken seriously, they’ll feel valued- as well as extra-invested in the future success of your business.

Recruitment designed for SMEs

Utilising the ‘insider knowledge’ and collective understanding of your company culture from within your organisation itself can be a hugely valuable asset to any SME, especially during times where recruitment can sometimes feel a bit of a challenge.

Whether you fill a vacancy via employee referral or through an agency, Breathe HR Recruitment Tool is designed to make hiring new team members seamless, from receiving their application, throughout the interview and shortlisting processes, to finally creating a profile for your new starter within your Breathe account speak to one of the team at Digital HR Ne for more information on changing the way you do your People Admin.

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