The Hidden Costs Behind Limiting Referrals to "How Did You Hear About this Job?"

Today, many companies rely on the "How did you hear about this job?" field in their job application process to capture employee referrals. In this setup, candidates are asked to select “referral” as their source and then provide the name of the employee who referred them.

This blog explores why this approach is costing organizations valuable candidate leads and creating unnecessary challenges in the recruitment process.

1. Missed Sourcing Opportunities: Beyond Referred Applicants

Capturing referrals only when candidates apply means you’re missing out on a valuable talent pool: referred prospects. These are individuals who were told about the job by an existing employee but either never applied or didn’t complete their application. By relying solely on the "How did you hear about this job?" question, you're only catching those who follow through with the application process, leaving many potential candidates untouched.

Referred prospects often hold significant potential, as they’ve been pre-vetted by your employees and may be a great cultural fit. But when you wait for them to apply, you lose the chance to proactively engage them, potentially letting great talent slip through the cracks.

2. Administrative Headaches: The Incomplete Referral Data Dilemma

Once candidates select “employee referral” as their source, they’re typically asked to provide the name of the person who referred them. Here’s where the chaos begins. Most candidates will only put their friend’s first name, a nickname, or even something as vague as “my cousin.” This creates a manual nightmare for your HR and recruiting teams, especially if you have multiple employees with the same name or similar-sounding names.

Matching referred candidates to the correct employee becomes a tedious, error-prone process. This not only wastes valuable time but also diminishes the effectiveness of your referral program, as misattributed referrals can lead to employee dissatisfaction and lost incentives.

3. The Pitfalls of Form Collection: Legal and Security Concerns

So, what’s the alternative? There are generally two options: either force employees to log in to your ATS to submit a referral, or have a free form where employees can submit referrals directly. But the form collection approach comes with significant risks:

You May Get Sued

Yes, legal liability. Privacy laws dictate that you cannot store or contact candidates without their explicit permission. If your employee submits a referral without the candidate’s consent, you’re potentially violating these laws. This can lead to legal repercussions and damage to your company’s reputation.

Recruitment Scams

Even if you have an automated process where a text or email is sent to the referred candidate to apply or accept the referral, there’s a high risk of it being ignored. Recruitment scams are on the rise, and most candidates are wary of unsolicited emails or texts from unknown sources. This could lead them to block or ignore your messages, rendering your referral system ineffective.

Friction and Reduced Employee Engagement

Forcing employees to log in to the ATS to submit referrals introduces unnecessary friction into the process. This extra step can deter employees from participating in the referral program, reducing overall engagement. When the process isn’t seamless and user-friendly, employees are less likely to take the time to submit referrals, which ultimately diminishes the success of your program.

4. A Better Solution: Employee Referral Platforms

The solution? Implement an employee referral platform that allows your employees to generate a unique referral link, which they personally share with their friend. This link enables the candidate to provide basic contact information to your organization without needing to complete a full application upfront.

Platforms like Eqo make this process seamless, ensuring that the candidate’s information is securely and legally submitted, and making it easier for your HR team to track and manage referrals. By making the referral process more transparent and candidate-friendly, you’ll not only improve the quality of your referral pipeline but also protect your organization from legal and security risks.