When customer service is the key to your company’s success, it is critical to make sure you recruit and retain the best employees. While every car wash owner knows this, the decreasing unemployment rate and increase in jobs in other industries limits the number and quality of employees looking for work in a small service business setting.
Rather than rely on signage, local media, online postings or other forms of traditional advertising to promote job openings, some small business owners have found success by tapping into the knowledge and network of their own employees by offering bonuses for new employee referrals.
“We’ve always encouraged employees to recommend family members and friends for open positions, and we’ve offered a bonus program for five years,” said Heather Garcia, vice president of human resources for Gil Moore Oil, which has three locations that offer fuel, convenience store and car wash services in California. “We hire great people, so we are confident that they know great people who will be a good fit for our team.”
There are currently eight employees receiving employee referral bonuses for recommending other people who were hired at Moore. “Our program is designed to pay bonuses at different times based on how long the new employee stays with us,” Garcia said. When an employee refers someone who is hired, a bonus of $50 is paid at the new employee’s three-month anniversary, another $50 is paid at the six-month anniversary, and $100 is paid at the one-year anniversary. “We pay the bonuses at the three anniversary dates to encourage retention of employees because that is the best way to grow an experienced workforce that can help your business grow,” she said.
Retention is also the reason Hoffman Car Wash pays one-half of its $100 recruitment bonus when the employee is hired and the other half when the employee completes 30 days. “Initially, the program paid $100, but the payout was not until the employee had been working for 30 and 60 days,” said Mary Ellen Olenyk, SPHR, director of human resources for Albany, New York-based Hoffman Development Corporation, which owns 13 car washes and 11 Jiffy Lubes. The change to offering an immediate, partial payment reflects younger workers’ need for immediate reward to capture their interest.
At Globe, (www.globecar.com) a Montreal, Canada-based car and truck rental company, employees who refer a new hire receive a bonus at the six-month anniversary point, with the amount determined by the job position. The company’s four-year-old referral bonus program pays CA$250 for a car washer referral, CA$500 for a customer service or administrative position referrals, and CA$1,000 for referrals for management and strategic positions, said Husam Hatahet, vice president of sales and marketing for the company.
Although not all referrals work out, Hatahet has noticed an interesting, unexpected benefit of the program. “The new employees who did not work out left very early, even in the first days of training, so they would not embarrass the person who referred them,” he said. Because the friends or family members who referred them are likely to ask how training is going or what they think about the job, new hires are more honest about whether or not the job is the right fit for them. “This keeps the company from investing time and money in the wrong person,” he said.
Not all locations are equal
While many companies may make the bonus applicable to all positions at all locations, Hoffman employs a different strategy. Olenyk, a 25-year human resource professional who has worked in a number of industries, explains that her company uses the referral bonus program to recruit for hard-to-fill positions, usually at specific locations, rather than company-wide for all positions. “It is a tough hiring market, but some of our locations are in more challenging areas that do not provide an immediate pool of potential employees and may not be on bus lines that enable potential workers to easily get to work.”
In addition to alerting employees that a bonus is available for positions filled at a specific location, managers may also approach employees whose networks include potential employees. “For example, if we have a college student working while in school who is a good employee, we’ll ask if any of his or her college friends with a car would be interested in a job that can offer hours to work around class schedules,” Olenyk said. “If you like where you work, it is natural to encourage friends to work at the same place, but people don’t always think about it. The bonus program helps us staff the hard-to-staff locations, but there is no need for us to pay bonuses for jobs and locations for which the pipeline is always full.”
Making it work
Promoting the bonus program along with job openings is critical for success, Olenyk said. “Because we have so many young people working at our locations, we text messages about the program and openings,” she said.
In addition to making sure new hires know about the program and reminding employees periodically, Garcia said it is important to celebrate the program’s success by publicizing the bonus awards. “The more you talk about the program, and show that there are people receiving the bonuses, the more successful it will be,” she said.
One last piece of advice offered by Olenyk is to have a tracking system and process in place before you begin a program. “Depending on how many employees you have and how many bonuses you pay, it can get complicated, but the ongoing success and credibility of the program relies on you actually paying the employees who referred new employees.”
