Employee Referral Programs and the PERM Recruitment Process

As part of the PERM process employers are required to complete several recruitment steps before submitting ETA Form 9089. Most employers filing the ETA Form 9089  must attest, in addition to a number of other conditions of employment, to having conducted recruitment prior to filing the application.

Under the PERM recruitment process employers are required to do the following:

  1. Place job advertisements for the position in a newspaper of general circulation for two consecutive Sundays or place an advertisement in a professional journal; and
  2. An internal job posting notice; and
  3. Place a 30 day job order with the state workforce agency.

In addition to these required recruitment steps employers must choose three additional recruitment methods. One of the approved additional recruitment methods is an employee referral incentive program. On January 26, 2011 the Board of Alien Certification Appeals (“BALCA”) released an opinion providing guidance on how to properly conduct an employee referral incentive program. The decision stemmed from a Certifying Officers (“CO”) denial of certification on the ground that the Employer failed to provide adequate documentation of its employee referral program with incentives because it did not provide dated copies of its notices or memoranda advertising the program and specifying the incentives offered. In response, the employer provided evidence that their employee referral program was ongoing and that they reminded their employees of the program every six months. Additionally, the employer showed that over 90% of the applicants for the posted position came from the employee referral program. Despite this evidence the CO denied certification.

In their decision to overturn the CO’s denial of certification, BALCA stated:

Although the notice of the employee referral program that was provided with the Employer’s audit response materials was not dated, there is substantial evidence contained within the Employer’s audit response materials demonstrating that the employee referral program was in existence at the time that the Employer conducted recruitment related to this application. The Employer’s recruitment report shows that it received 45 applications for this position as a result of its employee referral program. Therefore, it is evident that the Employer’s employee referral program was in effect during the recruitment effort the employer is relying on to support its labor certification and that the Employer’s employees were on notice of the job opening. Given that more than 90% of the applications that the Employer received for this position learned of the position through the employee referral program, the employee referral program was by far the Employer’s most effective recruitment tool. To find that the Employer failed to adequately document this recruitment step when there is substantial evidence of the employee referral program’s existence and effectiveness, simply because the notice was not dated, would elevate form over substance and lead to an absurd result.Based on the foregoing, we find that the Employer’s documentation is sufficient to establish that it used its employee referral program as a method of recruiting U.S. workers for the occupation that is the subject of this application for permanent labor certification, and therefore, reverse the CO’s finding.

This decision provides guidance on how to properly use an employee referral program when recruiting under the PERM process. In this case the employer relied on evidence of a long standing use of an employee referral program to overcome the normal requirement to document recruitment steps with dated copies of recruitment efforts.

Although the employer in this case was able to point to a  long history of using  an employee referral program, not all employers fit into this mold. BALCA’s decision emphasizes the importance of properly documenting every step of the recruitment process to protect against potential denials. No matter how long an employer has used a recruitment method, it is always best to meticulously document each recruitment step  by providing dated copies of all recruitment efforts.

Click here to download the complete decision by BALCA