New Delhi: In a tight economic situation when most of the companies put restrictions on hiring, IT and ITeS companies focus on employee referral mode of hiring and internal promotions, reported The Economic Times. Many companies have restructured their working conditions due to global economic downturn.

Now, almost 40 percent hiring is through employee referrals, and 80 percent of our promotions are internal, said Piyush Mehta, Senior Vice-President and HR head, Genpact.

He also said, "We are more inclined towards it, as apart from saving time on comprehensive background checks and scanning, it also helps better camaraderie among employees. When a candidate is employed through referral program, there is less probability of the candidate leaving the organization in a small span of time." Genpact's attrition rate at the moment is 25 percent.

Employee referral mode helps the organizations to save time searching, headhunting and calling candidates and is also helpful in retaining the recruited people.

A Sudarshan, Vice President, sales and marketing, Expertus, a talent management and recruiting firm opined, "There has been an increase in hiring through employee referrals by 59 percent across sectors, and at all levels." He however mentioned that this mode of hiring has an adverse impact on headhunting and recruiting firms.

To ensure a successful referral system, many companies are giving monetary benefits to the employees who bring talented candidates. MindTree Consulting has an employee referral program 'Each One Bring One'. Infosys BPO is also focusing at internal recruitment and promotions. "It also helps in developing employee relations as the employee's social needs are met and they have a feeling of belongingness towards the organization," said Shailesh Mehta, CEO, Gurukulonline Learning Solutions.