Internal Recruitment

By Amanda Beattie
14 Jun 2022

Your current workforce is your most valuable asset. Your employees are vital to the success of your business. Yet, when looking to recruit for a new role, they are often overlooked.

Recent statistics tell us that only 61% of employers in the UK have a “clearly defined, well documented process established for recruiting internal employees.”

In this article, we’ll explore whether internal recruitment is right for your organisation. What the benefits and drawbacks? How should you go about it? Read on to find out…

What is internal recruitment?

When looking to fill a vacancy within your business, you consider your existing employees.

This can include a promotion or a restructure, where an individual moves to a new department. External recruitment is where you recruit talent outside of the company.

Advantages of internal recruitment

So, what are the benefits of internal recruitment?

1. Time saving

You don’t need to carry out background checks, as you’ve already done them. You won’t need to assess whether they’re a good fit for the business, as you’ll already know. Your interview with the candidate can focus entirely on their suitability for the new role. Should you choose to hire them, the onboarding process will be shorter too.

2. Cost effective

You won’t have to rely on external resources, such as recruitment agencies. You won’t have to pay for expensive job ads, or utilise job boards. In many cases it is cheaper to promote an existing employee than to hire a brand new staff member.

3. Rewards staff and improves morale

Career progression is important to staff. If you show that opportunities for progression are available, it will help motivate and improve the morale of existing staff. It also gives individuals the opportunity to develop new skills. Rewarding staff in this way shows you value their contribution and want to keep them.


internal recruitment


Disadvantages of internal recruitment

Of course, internal recruitment isn’t always the answer. There can be drawbacks too, including:

1. Small pool of candidates

Unless you are an extremely large organisation, your pool of candidates is limited. You may offer a new role and find that not many existing staff members are interested or qualified. This can leave you in an awkward position.

2. Creates workforce gaps

It’s not always the case, but by promoting one employee, you may create a gap. This could lead to an external hire, which is what you were trying to avoid in the first place. You can mitigate this issue by having conversations within the department and planning ahead.

3. Stagnates culture

If you rely exclusively on internal hires, you avoid bringing in fresh faces. This can result in staff relying too much on old methods and a lack of innovation. A new perspective can stimulate change and growth, internal recruitment can block this.

4. Negative impact on company culture

Perhaps even worse than stagnating culture, it can create a toxic one. When internal recruitment is offered as a reward for performance things often get competitive. Too many rejections will cause dissatisfaction or cause staff to leave the business. When you have two candidates equally qualified for a role, their could be some bitterness when one is chosen over the other. Also, if a manage doesn’t want to lose a member of their team, they could hinder the transfer.

When to use internal and external recruitment

Very few companies rely exclusively on internal hires. However, successful businesses will often combine internal and external recruitment.

To avoid some of the issues above, there are a few rules you should follow.

  1. If you have an internal candidate in mind for a role, approach them directly. A simple promotion makes more sense than opening up the vacancy for applications if you already know who you want to fill that role.
  2. If you do have a role you want to promote internally, follow a formal process similar to your existing recruitment procedure.
  3. Make sure the role is circulated thoroughly via different channels to ensure everyone knows the vacancy is up for grabs.
  4. Write a full, accurate job description to ensure the applicant knows what their responsibilities will be in the new role.
  5. Don’t rely exclusively on promotions to reward staff. This will breed resentment and demoralise your workforce.

Remember, you can recruit internally and externally for a role. Base the decision on the responsibilities and skills needed for the vacancy.


internal recruitment examples


Internal recruitment examples

If asked to describe internal recruitment methods, most employers would stop at “promotion.” However, there are many other ways of recruiting internally. Other methods include:

  • Transfers
  • Freelance to full-time employee
  • Enlisting retired former employees
  • An employee referral scheme

For example, you may have several employees in your marketing department, but not enough in your events department. The roles often overlap, so it would make sense to move an individual from an overstaffed marketing role to the understaffed events department.

We would always recommend consulting with the individual before initiating a transfer. Depending on the wording in your staff contracts, this may be a relatively easy process.

Support with internal recruitment

There are benefits and drawbacks to internal recruitment. The key is using it the right way for the right roles. To determine when and how you should use the above methods, speak to a HR expert today.

Call a Croner consultant on 01455 858 132 for immediate advice on recruitment and internal hiring.

About the Author

Amanda Beattie

Amanda represents corporate clients and large public bodies, including complex discrimination and whistleblowing claims. Amanda also drafts and delivers bespoke training regarding all aspects of employment law, including ‘mock tribunal’ events; in addition she also frequently drafts employment law articles for various publications for Croner and their clients.

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