Restaurant employee referral program template: policy and form

Ask a restaurant manager where their best hires came from and you'll often hear the same answer: "Someone on the team brought them in." A server's roommate who's been bussing at another place, a cook's cousin who wants more hours. Your team knows who's reliable, and they don't want to work next to someone who isn't.

A referral program turns that into something you can count on: a clear promise, a simple form and a payout nobody has to chase. This post gives you all three, and the payroll rules that come with paying a bonus.

General information, not legal or tax advice. Your payroll provider handles the withholding, and state wage laws may add their own rules on bonuses and final pay.

Before you write it: four decisions

Decision	Options	Our suggestion for a small café or restaurant
How much	A flat amount; more for hard-to-fill roles	[$100] for front of house, [$200] for cooks and shift leads. Pick an amount you'd happily pay every time
When it's paid	On hire; after a set time; in two parts	Half after [30 days], half after [90 days] the new hire still works here. The bonus is for people who stay
Who can earn it	All staff; staff below a certain level	Every employee except owners, the GM and anyone whose job includes hiring for that role
What counts	Any hire; only certain roles	Any open role on the list, referred on the form before the candidate applies

Write the answers down once. Changing the amount or the rules halfway through a referral is how a program loses trust.

The policy

Adapt the bracketed parts, keep it to one page, and put it in your employee handbook.

[Café / restaurant name] — Employee referral program

1. What it is. If you refer someone we hire, and they stay, we pay you a referral bonus as a thank-you.

2. The bonus

Role hired	Bonus	Paid
[Server, barista, host, cashier, busser]	[$100]	[$50] after the new hire's [30th] day, [$50] after their [90th] day
[Line cook, prep cook, shift lead]	[$200]	[$100] after their [30th] day, [$100] after their [90th] day

3. Who can earn it. Every employee, except [owners, the general manager] and anyone who interviews or hires for that role.

4. How to refer someone

Fill in a referral card and give it to [the GM] before the candidate applies or interviews.
If two people refer the same candidate, the first card received counts.
Referring someone isn't a promise they'll be hired. Every candidate goes through the same application and interview as everyone else.

5. When it's paid

Each part is paid on the next regular paycheck after the new hire reaches that day, if you and the new hire both still work here on that day.
The bonus is taxable wages and goes through payroll like the rest of your pay.

6. What doesn't count

Rehiring someone who worked here in the last [12 months]
Candidates who already applied before your card
Referring yourself or someone you supervise directly

7. Changes. We may change or end this program for future referrals. Referrals already made under these rules will be paid under these rules.

Rule 4 is the one that prevents arguments. Rule 7 is the one that makes changing the program fair.

The referral card

Small enough to keep a stack by the time clock.

Referral card

Your name: ………………………… Your role: ……………

You're referring: ………………………… Phone or email: …………………………

For the role of: ………………………… Location: ……………

How do you know them? ………………………… Have you worked with them? ☐ Yes, where: …………… ☐ No

Why would they be good here? …………………………

Date: …………… Received by: ………………………… Date received: ……………

Ask the candidate to fill in the regular job application, and score them on the same interview scorecard as everyone else.

The payout log

One line per referral, kept by whoever runs payroll.

Referral payout log

Referred by	Candidate	Role	Card received	Hired?	Start date	Day [30]	Day [90]
[Name]	[Name]	[Line cook]	[Mar 3]	Y	[Mar 16]	[Apr 14]	[Jun 13]

Count day 1 as the start date, so in the example, day 30 is April 14 and day 90 is June 13. Check the log every payday. A referral bonus that's late or forgotten does more damage than having no program at all.

How a referral bonus works in payroll

It's wages. The IRS says pay for employment taxes includes "salaries, vacation allowances, bonuses, commissions, and taxable fringe benefits", and lists bonuses among supplemental wages, the payments that aren't regular wages (Publication 15, sections 5 and 7). So the bonus goes through payroll with withholding; it isn't handed over in cash from the till. Your payroll provider will know which withholding method it uses.

It may change the overtime rate. Under the Fair Labor Standards Act, overtime is paid at one and a half times the regular rate, and "Bonuses which do not qualify for exclusion from the regular rate as one of these types must be totaled in with other earnings to determine the regular rate" (29 CFR 778.208). The Department of Labor's rule on discretionary bonuses lists "referral bonuses for employees not primarily engaged in recruiting activities" among bonuses that may be discretionary, and so left out of the regular rate (29 CFR 778.211(d)). But a bonus is discretionary only when the employer decides both whether to pay it and how much at or near the end of the period, without a prior promise: "If the employer promises in advance to pay a bonus, he has abandoned his discretion with regard to it" (§778.211(b)). A written program with a set amount is a promise. If a referrer worked overtime in the weeks the bonus covers, ask your payroll provider how it handles the bonus in their regular rate.

Keep it fair. A program that only ever brings in friends of the current team can make your team more alike than your town. Keep posting every job publicly as well, and hire referrals through the same application and scorecard as anyone else. Our first team hiring guide covers the rest of the hiring process.

Getting the word out

Post the open roles where the team will see them: the staff board, the pre-shift huddle, the team chat.
Say the amount out loud. "We pay $200 for a cook who stays three months" gets more referrals than "ask about our referral program."
Thank people in public when a part is paid: at pre-shift, with the referrer's OK.
Tell referrers what happened. A quick "we interviewed them, it's not the right fit this time" keeps people referring.

Your referral program checklist

[ ] Amount, timing, eligibility and what counts decided, in writing
[ ] Policy in the handbook and posted by the time clock
[ ] Referral cards available, dated when received
[ ] Every referred candidate goes through the same application and interview
[ ] A payout log, checked every payday
[ ] Bonuses paid through payroll, as wages
[ ] Payroll provider asked about the bonus and overtime
[ ] Jobs still posted publicly too

Where Mays fits

Mays doesn't have hiring, applicant tracking or a referral program. What you can do once someone is hired:

The start date the payout counts from. When you add the new hire under Locations & Users, fill in Hire date (their first day of work). See Add and invite team members.
The open roles, where the team reads them. Post the list and the referral amounts in a team Group chat in the app, and put the policy in a Knowledge Base folder shared with everyone. See Group chats and Your knowledge base.

What Mays doesn't do: there's no referral card or payout log in Mays, no reminder when a new hire reaches day 30 or day 90, and there's no place in Mays to add a bonus to someone's pay, so add the referral bonus in your payroll provider. See Payroll export.

The best recruiters already work for you

Decide the amount and the rules, write them on one page, take a card before the interview, and pay on time, through payroll, for people who stay. A referral program costs a few hundred dollars a hire, and the person who referred them has every reason to help them succeed.

Start your free trial: 30 days, every module, no card needed. Or book a walkthrough and we'll set up your team, onboarding and knowledge base with you.