Employee Referrals and Workplace Diversity: Strategies for HR
This paper examines how human resources departments can use employee referral programs to expand the workforce without sacrificing workplace diversity. Drawing on agency theory and Maslow's hierarchy of needs, the paper analyzes why referral relationships matter, how unconscious bias affects hiring outcomes, and what structural changes can mitigate non-diverse hires. Literature findings from Frank (2018), Ranade (2020), and Payscale (2018) are synthesized to produce actionable recommendations, including blind hiring, diverse referral incentives, and unconscious bias training. The Uber case study illustrates how a Chief Diversity Officer, structured referral programs, and the "Rooney Rule" can transform a previously homogeneous corporate culture into a more equitable and inclusive workplace.
- Introduction: Central research question on referrals and diversity
- Theoretical Framework: Agency theory and Maslow's hierarchy applied to HR
- Findings of Literature Research: Literature recommendations for diverse referral programs
- The Uber Case Study: Uber's 2017 diversity overhaul as a practical model
- Conclusion: Actionable steps synthesizing theory, literature, and case
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What makes this paper effective
- The paper grounds a practical HR problem in two distinct theoretical frameworks—agency theory and Maslow's hierarchy of needs—giving its recommendations academic credibility rather than treating them as mere best practices.
- The Uber case study is used purposefully: it is introduced at the end of the literature review and then unpacked methodically, showing each recommended policy in real-world action.
- The conclusion mirrors the introduction's central research question, creating a clean circular structure that reinforces the paper's argument and makes it easy for readers to evaluate whether the question was answered.
Key academic technique demonstrated
The paper demonstrates applied theoretical analysis—taking abstract frameworks (agency theory, Maslow's hierarchy) and mapping them directly onto a concrete business problem. Rather than simply describing the theories, the author explains exactly how each framework constrains or enables HR decision-making around referrals, which is a hallmark of strong graduate-level business writing.
Structure breakdown
The paper follows a five-section research paper structure: an introduction that poses the central research question; a theoretical framework section covering agency theory and Maslow's model; a literature review synthesizing Frank, Ranade, Payscale, Eisenhardt, and Jensen and Meckling; a case study applying all findings to Uber's 2017 diversity overhaul; and a conclusion that restates the question, lists actionable steps, and ties back to both theories. The numbered policy lists in the case and conclusion sections add clarity and make the recommendations easy to follow.
Introduction
As Frank (2018) points out, over 33% of all US employees obtained their job with their current organization by way of referral from another employee. Although employee referrals are an easy, fast, and often tempting way to staff positions, the risk is that doing so can lead to a less diverse workplace, with 40% of all referrals tending to be white men (Payscale, 2018). The central question is: How can HR use employee referrals to increase the workforce while still maintaining diversity within the organization?
The solution is to consider closely the source of the referral. Different relationships between the referring source and the referral have different workplace outcomes. For example, a referral who is a family member or friend of the referring source is less likely to develop a strong relationship with management and is more likely to leave the company at some point than is a referral who is simply part of the referring source's extended personal network (Payscale, 2018). Thus, HR should be careful to look closely at the relationship between the referring source and the referral.
HR should also be careful about how it conducts the process of recruiting candidates. Instead of asking for referrals, it may better obtain a diverse staff by asking employees for leads (Ranade, 2020). This paper examines research findings, applicable theory, and a case example to illustrate why referral-referee relationships matter when it comes to ensuring equitability in the workplace, and why search strategies such as deliberately asking for diverse referrals—or even for leads instead of referrals—can help reduce the risk of non-diverse hires.
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