Referral bonus
A referral bonus is the payment to a current employee whose referral results in a hire — typically €500-2,000 for SMB roles, sometimes more for senior or hard-to-fill positions. The cheapest cost-per-hire of any sourcing channel.
Typical structures
European SMBs usually run one of three patterns:
- Flat amount per hire: €1,000-2,000 regardless of role. Simple to administer, easy to communicate.
- Role-tiered: €500 for junior, €1,500 for mid, €3,000-5,000 for senior or hard-to-fill. Reflects the actual value of the hire.
- Multiplier on time: bonus paid in two tranches, e.g., 50% at start date and 50% after 6 months. Aligns the referring employee’s interest with retention, not just signing.
What matters more than the amount: the bonus is paid quickly (within 30-60 days, not after a 12-month wait) and visibly (employees see when colleagues get paid).
What’s a reasonable amount
Calibrate against the typical cost-per-hire from other channels:
- Cold sourcing or agency: €4,000-€25,000.
- Paid job-board placement: €600-€1,200.
- Referral: bonus + admin = €1,500-€3,000.
The arithmetic is consistent: even at €3,000, referrals are the cheapest per-hire source in most SMB hiring data. Increasing the bonus is rarely the lever — increasing referral volume is.
How to actually drive referrals
Three operational moves that produce more referrals than amount alone:
- Monthly nudge with the current open roles, with each role’s referral bonus listed.
- Clear submission path: a form, not “send the CV to HR.” Fewer steps = more submissions.
- Acknowledgment loop: an email to the referrer when their referral hits any stage, not just hire.