The Dark Side of Employee Referral Bonus Programs: Potential Applicants’ Awareness of a Referral Bonus and Perceptions of Organisational Attractiveness

Abstract

The purpose of this study is to examine the effects of potential applicants’ awareness of employees being rewarded for referrals on organisational attractiveness, based on credibility theory and the multiple inference model. In a first study (N = 450), final‐year students were less attracted to the organisation when they knew employee referrals were rewarded, which was partially explained by lower credibility perceptions. Moreover, varying the specific characteristics of the referral bonus program (i.e. timing, size, type, recipient) did not improve potential applicants’ perceptions of credibility and attractiveness. A second study (N = 127) replicated the negative effect of referral bonuses on organisational attractiveness and found that it could be explained by both potential applicants’ inferences about the referrer's other‐oriented motive and lower referrer credibility. Whether employees explicitly stated that their referral reason was bonus‐driven or not did not affect these results.

Working Anywhere, Anytime: An Experimental Investigation of Workplace Flexibility's Influence on Organizational Attraction

“…The completion of the paper-and-pencil survey took about ten minutes. Similar to their own real-life situation, the respondents were asked to imagine themselves as actual job-seekers (e.g., Stockman et al, 2017) before they were shown a job advertisement from a fictitious German retailer ("MARZEO") for a position as a trainee in the corporate headquarter. Companies in the retail industry are particularly suited to research on organizational attraction, as this industry has an expandable employer attractiveness (Rudolph & Runco, 2006).…”

“…Thus, it is important to gain knowledge on how their perceived organizational attraction is affected. As a main target group of time-consuming and costly recruiting efforts (Aiman-Smith et al, 2001;Sivertzen et al, 2013) they are a widespread study population in research on organizational attraction (e.g., Stockman et al, 2017). To increase the practical relevance of our sample, we asked 419 business students who were at an advanced stage in their bachelor's program (67%) or master's program (33%) to participate in this study, as they would soon be entering the labor market (e.g., Stockman et al, 2017).…”

Examining the Relations between Organisational Attraction, Organisational Image and Organisational Loyalty: An Investigation with Teachers

“…Örgütsel çekicilik son yıllarda dikkatleri üzerine çeken bir kavram olarak göze çarpmaktadır (Güler ve Basım, 2015;Lambert, Basuil, Bell ve Marquardt, 2017;Lievens, Van Hoye ve Schreurs, 2005;Nolan ve Harold, 2010;Stockman, Van Hoye ve Carpentier, 2017). Örgütlerin potansiyel çalışma adaylarının ve mevcut çalışanlarının örgütte devam etme istekliliklerini güçlendirmesi, örgüte duyulan çekicilik algısı ile ilişkilidir.…”

How can hospitals engage their current employees in the recruitment of qualified nurses? A referral bonus and self‐determination perspective

“…We manipulated promising a referral bonus by mentioning that employees receive a €500 referral bonus for a successful referral versus mentioning nothing about rewarding referrals. The bonus amount was based on input from HR managers from the healthcare sector and a previous study on referral bonuses (Stockman, Van Hoye, & Carpentier, 2017). In the autonomous referral request with a referral bonus, the bonus was positioned at the end of the e‐mail and framed as a way to thank the nurses in case they would refer.…”