How should we reward employees who recommend new hires?

“Even as the local economy has tightened up, we’re still hiring. But there’s good news and bad news: because unemployment is high, we’re getting lots of applications from unqualified people. I’d like to start an employee referral program to encourage our workers to recommend candidates. I hope that will give us a better quality applicant pool. How should I go about setting up such a program?”—Pete, Ala.

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