Here’s Why You Shouldn’t Pay Referral Bonuses to Hiring Managers
Your company decide to hire a new UI Designer. As a talent acquisition specialist, you promised a referral bonus. After a few days you receive an email from the hiring manager for the position saying that there's a chance to refer someone. That's great news, but an ethical and professional question arises almost automatically. Should you pay the referral bonus to the hiring manager if the person is hired?
Here's a good reason not to pay if the person gets hired. You probably understand that the money creates an additional incentive. You don't want to hire a person just because your hiring manager has too much influence in the process. I would even add that any person involved in the hiring process shouldn't get paid if the person is hired. HR is included in this list of people. Ideally your company should stay unbiased towards who gets on board.
But the budget is already allocated, you might say. Yes, if you still want to spend some money with a hope to bring great potential hires, there's a way to solve this. Don't pay the referral bonus if the person is hired, but pay for a simple applicant referral if it comes from someone in your company. That way the hiring manager doesn't have any additional money incentive to influence the final hiring decision.