The term ‘Referral Rate’ is a computation or a cipher of the total number of workforce members hired by the venture. It also includes the total number of candidates that were referred by the existing employees of the firm under the ‘Employee Referral Program.’
The Employee Referral Programs are extremely beneficial as they provide a high number of referral rates to the firm. It is a means of internal recruitment where the company asks the employees to refer various vacancies to their friends, relatives, acquaintances, etc., in exchange for a referral bonus or a reward. Let’s understand the concept with an example:
Suppose you work as a Human Resource Manager in ABC Pvt Ltd, and they introduce you to an ‘Employee Referral Program.’ Now, the way this program goes about is quite simple. You, an existing employee of the firm, recommend various vacancies to your friends, family, etc. The firm provides the employees with their own ‘referral code’ that their friends and family can use when they apply for the vacant position.
If the people you recommended for the vacancies use your code, your firm awards you with incentives.