Best Employee Referral Program Tools (+ Templates) in 2025

HR and talent acquisition teams are looking to add an employee referral solution because it can be a game changer for your recruiting efforts.  Here are the key benefits of referral technology, see below for how we translate these benefits into an actual return on investment calculation for your CFO.

• More Top of Funnel: Simply put, getting more referrals drastically increases the top of your recruiting funnel fast.  Right now you are no doubt getting employees to recommend their friends via your ATS or whatever system you currently have setup.  Imagine getting 3x that amount of candidates simply by putting in the right process, reminders, rewards.
• High Conversion Rates: For every 10 employee referrals, you probably get 1 hire.  Contrast that with the number of applicants you need from a job board or even your career site to get a hire.  Referral candidates convert to employees at a much higher rate.  This decreases time to fill, as well as the amount of hours you spend screening candidates.
• Better Retention: Job seekers who are brought to the recruiting team via employee referrals have a much better understanding of the job they are getting into.  This translates into better retention, especially for roles where churn is an issue: nursing, retail, transportation, etc.
• Employee Engagement: Anytime you can get your employees involved in the recruiting process is a win.  Employee referral tools make the workflow simple and rewarding for employees who get to help their friends, their company, and typically get a reward for themselves as well. This is a key part of employee experience software.

When we talk to our expert council of HR and talent acquisition professionals, there are a few things that come up again and gain when it comes to buying and implementing this type of software.

• Implementation goes at your pace: Implementing an employee referral program can take a week.  But, it usually takes longer.  Let’s face it, most people in recruiting are super busy filling reqs and don’t have the headspace to take on new initiatives.  So, we highly recommend giving someone on your team time to spearhead this initiative and make sure it gets done quickly.  Or, partner with a company that has a robust professional services org to help you.
• Metrics matter: Make sure that you are tracking where candidates are coming from in your ATS.  If you aren’t, then it may become hard to understand how much value this tool is actually creating.  Most of these vendors make it super easy to do that, but you still need to make sure it’s working.
• Understand cost per hire: The easiest way to say “yes” to this solution is to realize it’s going to lower your cost per hire.  But, do you know your cost pre hire currently?  Make sure you have a handle on your overall cost per hire (and ideally the cost per hire for all your different roles/channels) so that when it comes time to renew the contract, you know whether or not this channel is bringing down your costs!
• Employee Engagement: While the vendors listed above all have built in workflows to get your employees engaged in your hiring, you still need to think through your general philosophy on rewards, as well as how this will all be messaged.  Our advice is to get hiring managers onboard with a short presentation on why employee referrals is worth investing in, and then have the hiring managers re-enforce messaging to employees on a regular basis to keep your hiring pipeline full of high quality referrals.
• Dive In: Companies that are tentative in rolling out their programs typically don’t see high returns.  If you tell employees this is a pilot, they are going to be much more hesitant to use the product, and you won’t get the ROI you’re looking for.  Go all in, even if it’s for a “pilot” for one segment of your organization.
• Be Proactive: Referrals are great when your employees offer them.  But, the companies who are most successful with these programs have recruiters who are reaching out to their colleagues and asking for intro’s.  Use these tools as a sourcing database that has an 80% response rate from candidates vs whatever you’re currently getting on cold outreach.
• Integrations Matter: Make sure the vendor you partner with has easy to setup and maintain integrations with your ATS and HRIS - you don’t want to spend time each money downloading and .csv files.

Don’t get tripped up on these common hurdles, make sure you are thinking strategically about how a tool to boost employee referrals will be implemented and measured.

We believe that whenever you are going to ask for money, you should be prepared to back up your thinking with a model of the returns from your spend.  Here is a short model that details how we think about the ROI from implementing an employee referral platform.  Feel free to tweak it to meet your own goals.

Essentially, we’re going to drive more hires through employee referrals, at a lower cost than our typical recruiting channels.  This means we are saving money on each of these hires.  What’s not contemplated in this exercise (but feel free to model it if you’d like):

• Referred candidates typically ramp faster
• The benefits from decreased time to fill
• Referred candidates stay longer

Pro Tip: Put a time on your calendar right now for 6 months out that reminds you to go back and look at this model again.  What did you get right, and what did you get wrong?  Understanding this will allow you to get better as a practitioner and allocator of capital within your organization!

Generally speaking, the price you’ll get from a given employee referral program software provider depends on the number of employees in your organization and your ability to negotiate. More employees means more referrals, and a decreased cost per hire and time to fill.

Here are some general guidelines you can use to understand how much this type of software will cost you.

• Under 100 employees: $12,000/ year
• 100 - 999 employees: $36,000/ year
• 1,000 - 9,999 employees: $84,000/year
• 10,000+ employees: $360,000/year

Please note that some vendors also have implementation fees on top of the annual subscription (not necessarily a bad thing, especially if you need hands on help to get started)

If you’re looking at buying employee referral software, you’re probably going to get demos of a few different solutions.  We recommend staying organized by keeping track of the features that matter to you, and how each vendor can currently deliver on each.  The below spreadsheet will help you stay organized throughout your demos, so that you can pick the right referral platform.

Here’s a step-by-step guide to creating a referral program that is effective for your recruitment needs and easy and rewarding for your employees.

Free Template: Download the Employee Referral Program Template

#1. Define Your Program Objectives and Metrics to Track

What do you want to achieve with the referral program? Reducing [time-to-fill by %] and increasing [referral engagement by %] through the [Basile by HelloWork] platform can be a good example.

Next, what metrics will be used to track your program? Most employee referral program platforms let you track numerous figures on how your program has been doing. To give you an idea, number of referrals submitted, conversion rate of referrals to hires, time-to-hire for referred candidates, and retention rate of referred employees are some of the key metrics you can and should regularly monitor.

#2. Establish Eligibility Criteria

Who can refer? Is this open to all your full-time employees, along with or without part-time employees or contractors, or does it exclude certain categories like interns?

Which roles are eligible? Clarify whether all roles or just certain roles, like hard-to-fill positions, are eligible for the referral program.

#3. Choose and Set Up a Referral Platform

Choose the right referral platform. Each platform has its own ups and downs, so be sure you look into multiple options closely enough to make an informed decision. Our detailed reviews of the best employee referral program tools can be a good source for you in this case.

Properly implement the platform. First thing first—make sure your referral program works in harmony with your ATS and HRIS. This will save your recruitment and HR teams a lot of time and effort, as they won’t have to worry about keeping everything updated and consistent. The second step is ensuring your employees are onboarded with some great training. If they don’t see the benefits of getting involved, or if they’re unsure how to participate, they might not engage with the program. 

#4. Design a Simple Process for Referrals Using Software

Employees submit referrals through your chosen employee referral hiring software, where they can upload resumes or share job links via email/social media. Typically, this process is taken care of by the referral software itself.

All you need to do is determine which role is applicable to the program and the information you’d like to gather about the referee. This can include their name, contact details, resume/LinkedIn profile, and any notes from the referrals. Then, the system automatically tracks referrals and notifies HR when a referral progresses through the hiring stages.

#5. Create an Incentive Structure

A monetary reward of $500 for each entry-level hire and $1,000 for a senior-level role can motivate your team to refer candidates and earn extra income, while non-monetary incentives like points redeemable for gift cards, extra PTO, or public recognition have their own charm when it comes to encouraging employee participation. 

How do you choose? The answer lies in how well the incentive ideas align with your company’s budget and your staff's preferences.

Another important factor to not overlook is setting up a sound payout condition. Common good practices include paying bonuses after the referred employee completes 60 days or 3 months of employment.

#6. Communicate the Program

While most employers do a good job announcing their employee referral program, many don’t with their ongoing updates—regularly communicating benefits and submission deadlines to keep employees engaged with the program.

Referral reminder emails like “Double bonus week!” or “Urgent roles push” don’t require much effort from recruiters to create, yet they can go a long way in nudging employees to check out the program and participate.

#7. Recognize and Celebrate Success

There’s no better way to encourage your employees to participate in your referral program than by showing them the real cases of their peers getting rewards and recognition from their referrals.

There are several ways to do so, and luckily, most of which are quite simple. For example, you can announce top referrers through your team’s Slack channel, inside the referral platform dashboards, or during team meetings. Also, a team lunch can be a nice touch to celebrate program contributors.

#8. Track and Optimize the Program

Remember the metrics we discussed earlier? In this step, you’ll review these numbers from the referral program platform’s dashboard to gauge the effectiveness of your program, ideally quarterly.

The participation rate is too low? You’d benefit from re-evaluating your program criteria, rewards, and referral submission process. See a poor conversion rate of referrals to hires? It would be worth it to work on your job description, and/or test a longer payout condition.

We also recommend using the referral program tool’s surveys or feedback forms to gather insights from employees about program effectiveness. This would give you some great insights into what could be improved and make your people feel heard, too.

What is an employee referral program?

An employee referral program is a recruiting method where hiring managers incentivize current employees to refer qualified candidates from their networks to open roles.

What is employee referral software?

Employee referral software is a digital tool that makes employee referrals more efficient through automated recommendations, detailed employee networks, and gamification.

What are some benefits of employee referral software?

Employee referral program tools provide many benefits to your company, including:

• More top-of-funnel candidates
• Higher conversion rates
• Better retention
• Heightened employee engagement

What are the pitfalls and misconceptions about employee referral programs?

There are a few pitfalls and misconceptions that may arise when using employee referral programs. Implementation goes at your pace, meaning you have to put time and effort into getting it up and running. The metrics are important, and if you aren’t tracking if the program is working then you can’t be sure it’s working. Make sure you get a solution that integrates with your tech stack.

Do employee referral programs work?

Yes. SSRN found that between 30% and 50% of hires in the US are from referrals. By using an employee referral program, you’re ensuring that you’re keeping up with the competition and hiring the best talent.

What are some examples of effective employee referral programs?

According to a 2024 study by Switch On Business, notable employee referral program examples include Salesforce, Devon Energy, and Hubspot.

• Salesforce: 41.64% of hires come from referrals, with employees incentivized by competition and cash bonuses of $2,000.
• Devon Energy: 26.23% of hires are referrals, and they offer a $3,000 bonus for successful referrals.
• HubSpot: Offers referral bonuses ranging from $10,000 to $30,000, with 24.76% of hires sourced through referrals.

What metrics should I track to evaluate the effectiveness of my program?

Key employee referral program metrics include:

• Referral rate: Percentage of hires from referrals compared to total hires.
• Quality of hire: Performance and retention of referred employees versus those hired through other channels.
• Time to hire: Average time taken to fill positions through referrals.
• Retention stats: Percentage of referred employees who stay with the company after a specified period.
• Cost per hire: Total costs associated with hiring through referrals compared to other methods.
• Diversity recruitment metrics: Demographic data of referred candidates and hires to ensure diversity goals are met.
• Employee engagement: Number of employees participating in the referral program and their referral frequency.‍
• Conversion rates: Percentage of referred candidates who progress through each hiring stage.