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From my perspective, most referral bonuses aren't big enough to make it worth my while to try to get a friend in the door. When I know that my referral saves th

From my perspective, most referral bonuses aren't big enough to make it worth my while to try to get a friend in the door. When I know that my referral saves them $20k on a headhunter fee, getting < 10% of that rubs me the same way a nickel-an-hour raise would.

acangiano 16y ago
Not only that, but some companies' HR departments are best buddies with the headhunters and agencies. As a result, their candidates tend to be preferred (intentionally or not) over the "refer a friend" candidates you refer as an employee. I know it's a serious accusation, but several years ago I had statistical evidence that this was happening at a certain company where I referred more than 20 highly qualified candidates at a time when they were struggling to fill positions.
- lsc 16y ago
  >some companies' HR departments are best buddies with the headhunters and agencies. Considering the average quality of the candidates brought in by the agencies, this is the only rational explanation I can think of as to why companies still use agencies.
eftpotrm 16y ago
Then I'm not sure you're the person to be working as a startup employee.
- bartonfink 16y ago
  Fair point, and I'd agree. My career goals aren't particularly amenable to most startups, and with a child I have little interest in the risk/reward profile of startups. Further, I have little interest in mixing my personal and professional relationships - that seems like a needless complication for little gain. That said, my point still stands. $2000 isn't worth it for me to do my company's dirty work and knowingly save them $18000 in the process.
- lsc 16y ago
  Really? I'd expect a startup employee to be more interested in, ah, 'extracting value' than a regular employee. I mean, you've gotta have /some/ reward for all that risk. (I mean, it's different if it's a company that wouldn't have paid a headhunter anyhow; but I think the grandparent was objecting to the difference between what you are paying the headhunter and what you are paying the employee, more than the absolute amount you are paying.)
  - eftpotrm 16y ago
    Extracting (appropriate) value, yes, but how and when becomes the issue. If the company is going through a cashflow issue - far from unheard of in a startup - insisting on extracting the full value of your pound of flesh there and then would be counterproductive. Equally one's startup should be increasing in value by more to than the cost of the hire so again it could very well be in your interest as that sort of employee not to extract the full value if to provide the lead for free could permit a far earlier hiring than would otherwise be the case.
    - lsc 16y ago
      eh, if you can afford to pay a headhunter $18K, you can afford to pay your employee little more than a grand. (Most programmers, rightly or wrongly, once they judge a few recruiter-arranged candidates, believe that recruiters bring no value, so the very idea that you are using a recruiter implies waste.) On the other hand, like I said, if you can't afford to pay the headhunter, then your employee shouldn't whine about not getting a recruiting bonus. I've personally referred many people who got jobs, and I don't think I've ever gotten more than a free beer out of the deal.
brc 16y ago
I got done over with this. When I was leaving a job (for geographical reasons) I found a friend, convinced him to apply for my job, and then organised the interview, etc. They gave him the job pretty much on the spot. When I asked for my referral fee, they refused on the basis that I was a 'contract employee'. Nobody of course mentioned this when I was busy organising the interviews. I found out later that the agent who was busy trying to place the job leaned on the HR people to make sure I didn't get the money, because he didn't want to lose out. Yes, I occasionally went to the pub with the HR people also. Well I did him in, I instructed my incoming friend that the agent wasn't to be trusted and so my friend never put another job through him again. The guy probably lost 50k in commission over the next year or two, all because he didn't want someone to get 2k of someone elses money. Why so many employment agents have to act dishonestly and sneakily, I'll never know. It's as though they think they can control every conversation that happens within the company.
ajju 16y ago
At the risk of sounding like a marketing guy for TopProspect.com (I don't work for them, own any stock etc.), they solve this problem too. You get paid what a head hunter would be paid for recommending a friend who gets hired.
nradov 16y ago
That doesn't make any sense. The primary benefit of referring your friend is to help your friend get a job. I would do it even for free. Someday your friend will return the favor.
- bartonfink 16y ago
  Assuming you have friends in the field looking for work, maybe. However, maintaining a barrier between my personal and professional relationships is worth more than a pittance to me. It's worth $500-2000 to me to keep that barrier in my life and avoid poisoning the friendship if the professional side goes sour. I'd rather help my unemployed friend find work in other ways or even loan them money to help keep them afloat while this was going on (and yes, I've done both). More to the point, my understanding of these referral programs is that companies want to poach talent from other places on the cheap. It's never couched in terms of "help your unemployed friends and get paid" - it's always phrased as "know someone sharp? why not convince them to work for us!" Why should I help them do that? If they offered me some substantial fraction of what they would pay a headhunter for the EXACT SAME SERVICE (actually it's inferior service because I am trained to know who's good - they have no idea), I might be more flexible. $10,000, even after tax, would be enough of a positive impact on my life that it's worth the risk to the friendship. $500 means I'll pass.

acangiano 16y ago

Not only that, but some companies' HR departments are best buddies with the headhunters and agencies. As a result, their candidates tend to be preferred (intentionally or not) over the "refer a friend" candidates you refer as an employee. I know it's a serious accusation, but several years ago I had statistical evidence that this was happening at a certain company where I referred more than 20 highly qualified candidates at a time when they were struggling to fill positions.

lsc 16y ago
>some companies' HR departments are best buddies with the headhunters and agencies. Considering the average quality of the candidates brought in by the agencies, this is the only rational explanation I can think of as to why companies still use agencies.

eftpotrm 16y ago

Then I'm not sure you're the person to be working as a startup employee.

bartonfink 16y ago
Fair point, and I'd agree. My career goals aren't particularly amenable to most startups, and with a child I have little interest in the risk/reward profile of startups. Further, I have little interest in mixing my personal and professional relationships - that seems like a needless complication for little gain. That said, my point still stands. $2000 isn't worth it for me to do my company's dirty work and knowingly save them $18000 in the process.
lsc 16y ago
Really? I'd expect a startup employee to be more interested in, ah, 'extracting value' than a regular employee. I mean, you've gotta have /some/ reward for all that risk. (I mean, it's different if it's a company that wouldn't have paid a headhunter anyhow; but I think the grandparent was objecting to the difference between what you are paying the headhunter and what you are paying the employee, more than the absolute amount you are paying.)
- eftpotrm 16y ago
  Extracting (appropriate) value, yes, but how and when becomes the issue. If the company is going through a cashflow issue - far from unheard of in a startup - insisting on extracting the full value of your pound of flesh there and then would be counterproductive. Equally one's startup should be increasing in value by more to than the cost of the hire so again it could very well be in your interest as that sort of employee not to extract the full value if to provide the lead for free could permit a far earlier hiring than would otherwise be the case.
  - lsc 16y ago
    eh, if you can afford to pay a headhunter $18K, you can afford to pay your employee little more than a grand. (Most programmers, rightly or wrongly, once they judge a few recruiter-arranged candidates, believe that recruiters bring no value, so the very idea that you are using a recruiter implies waste.) On the other hand, like I said, if you can't afford to pay the headhunter, then your employee shouldn't whine about not getting a recruiting bonus. I've personally referred many people who got jobs, and I don't think I've ever gotten more than a free beer out of the deal.

brc 16y ago

I got done over with this. When I was leaving a job (for geographical reasons) I found a friend, convinced him to apply for my job, and then organised the interview, etc. They gave him the job pretty much on the spot. When I asked for my referral fee, they refused on the basis that I was a 'contract employee'. Nobody of course mentioned this when I was busy organising the interviews. I found out later that the agent who was busy trying to place the job leaned on the HR people to make sure I didn't get the money, because he didn't want to lose out. Yes, I occasionally went to the pub with the HR people also. Well I did him in, I instructed my incoming friend that the agent wasn't to be trusted and so my friend never put another job through him again. The guy probably lost 50k in commission over the next year or two, all because he didn't want someone to get 2k of someone elses money. Why so many employment agents have to act dishonestly and sneakily, I'll never know. It's as though they think they can control every conversation that happens within the company.

ajju 16y ago

At the risk of sounding like a marketing guy for TopProspect.com (I don't work for them, own any stock etc.), they solve this problem too. You get paid what a head hunter would be paid for recommending a friend who gets hired.

nradov 16y ago

That doesn't make any sense. The primary benefit of referring your friend is to help your friend get a job. I would do it even for free. Someday your friend will return the favor.

bartonfink 16y ago
Assuming you have friends in the field looking for work, maybe. However, maintaining a barrier between my personal and professional relationships is worth more than a pittance to me. It's worth $500-2000 to me to keep that barrier in my life and avoid poisoning the friendship if the professional side goes sour. I'd rather help my unemployed friend find work in other ways or even loan them money to help keep them afloat while this was going on (and yes, I've done both). More to the point, my understanding of these referral programs is that companies want to poach talent from other places on the cheap. It's never couched in terms of "help your unemployed friends and get paid" - it's always phrased as "know someone sharp? why not convince them to work for us!" Why should I help them do that? If they offered me some substantial fraction of what they would pay a headhunter for the EXACT SAME SERVICE (actually it's inferior service because I am trained to know who's good - they have no idea), I might be more flexible. $10,000, even after tax, would be enough of a positive impact on my life that it's worth the risk to the friendship. $500 means I'll pass.