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Employee Data Protection and Why It Matters

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Employee Management

Employee Data Protection and Why It Matters

Data protection is crucial because it guards against identity theft, hacking, and other illegal activities that could compromise an organization's information. A data protection plan must be implemented by any organization that wants to function effectively to ensure the security of its information.

Workpay
November 24, 2022
6
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November 24, 2022
8 min read
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Employee data is the information that a company or business gathers about its workers during employment. It includes standard information such as names and hire dates. Additionally, employee data can have demonstrative information on the worker, such as their engagement statistics and performance.

Some employee data examples include:

●  Qualifications- professional experience, training, previous job roles, etc.

●  Demographic information- gender, age, marital status, etc.

●  Attendance- time off records, vacation, sick days, leaves, etc.

Keeping employee data has many benefits for business managers and the company. However, companies are responsible for protecting sensitive information.

So how do business managers protect employee data? And what are the consequences of insufficient protection? The information below provides detailed answers to these and related questions.

What Is Employee Data Protection?

Employee data protection is the action of ensuring that employee personal data is protected while they are working for the company. It is an important act that all job providers must actively exercise for every employee.

Employee data protection involves:

●  Guarding employee information against cyber attacks.

●  Informing employees of every data collection and processing instance.

●  Informing employees about who gets access to their data and why.

●  Developing and exercising detailed data retention policies that apply to failed applicants and employees who move on from the company.

●  Ensuring limited access to the data by only providing the information when necessary.

●  Continued awareness of privacy and data protection laws. It also applies to the origin country of your employees if you have remote workers.

General Data Protection Regulation (GDPR)

The type of data a company stores varies. Regardless, governments recognize that all employee data is sensitive and requires protection. As such, there are many data privacy laws, with some applying to more than one region.

One of the major global privacy laws is the General Data Protection Regulation or GDPR. It is the strictest privacy and security law globally, drafted and passed by the European Union. The law has been in effect since May 25, 2018.

The law imposes obligations to companies anywhere globally as long as they collect data related to people in the EU. So, even if an employer is sitting in Africa but processing data from EU residents, they are obligated to comply with GDPR.

The initial purpose of the law was to give consumers control over their personal data. However, employees have multiple rights under GDPR's People's privacy rights. Additionally, the law increases employers' obligations concerning how they collect, use, store, and protect personal data.

Employees' Rights

Employees have the following rights:

1. The right of access

Employees have the right to access their personal data and other information. They can also obtain confirmation that their information is being processed. Employers must comply with access requests from employees within a month.

2. The right to data portability

Employees have the right to receive their data in a structured format. Additionally, the data must come from the employer in a commonly used and machine-readable format. Furthermore, the employee has the right to move, copy, or transfer the data without hindrance to usability. Employers must comply with requests within a month without imposing fees.

3. The right to be informed

This right emphasizes the need for an employer to be transparent about how they use personal data. Employers must provide fair processing information through a privacy statement in clear and plain language. Additionally, it must be free and easily accessible.

4. The right to object

Employees have the right to object to:

●  Processing: established on legitimate interests or the execution of tasks in the public interest/exercise of official authority (including profiling).

●  Processing for the objective of historical or scientific research and statistics.

●  Direct marketing, including profiling.

5. The right to restrict processing

Employees can prevent processing of personal data in cases such as where:

●  Processing is unlawful

●  They challenge the accuracy of their personal data

      Employer no longer requires their personal data.

6. The right to rectification

If the data is incomplete or inaccurate, employees have the right to get the information rectified. Employers must comply with requests to rectify personal information within a month.

7. The right to be forgotten/ erasure

An employee can request the removal of personal data on the grounds that there is no need for the employer to continue processing it. When an employee withdraws consent, and there is no legitimate reason to keep processing, the employer must erase it. This also applies if the data is being unlawfully processed– to comply with legal obligations. 

Rights relating to automated decision-making and profiling

Employees have the right to obtain human intervention against a potentially damaging decision. Employees can express their point of view, get an explanation of the decision, and challenge it.

However, the right does not apply if the automated decision is required for entering into a contract with the employer. Similarly, it is not applicable if it is authorized by law, based on explicit consent, or lacks a legal/significant effect on the employee.

Employer Obligations

Employers have to demonstrate that they are GDPR compliant. Luckily, there are many ways to show it, including:

●  Maintaining structured and detailed documentation of the collected data. Employers must also document how it is used and stored and who is responsible for it.

●  Designating data protection responsibilities to the team. Employers can also appoint a data protection officer if needed.

●  Developing and implementing organizational security measures. Employers must also train staff on the same. 

●  Establishing Data Processing Agreement contracts with any third-party contractors that process data for the company.

Data Processing

Employers must process data according to the seven protection and accountability principles. In addition, employers can only legally collect, store or sell data if they can justify it with

●  Unambiguous consent

●  Requirement to enter into a contract

●  To comply with a legal obligation

●  To save someone's life

●  To perform a task in the public interest

●  Legitimate interests

Data Security

Employers must manage data securely by applying the suitable technical and organizational measures. An example of a technical measure is directing employees to use two-factor authentication on accounts with personal data. This is one of the ways employees protect their personal data. It can also be employing cloud providers that use end-to-end encryption.

On the other hand, organizational measures include staff training, limiting access to personal data, and establishing a data privacy policy.

In addition, GDPR demands that everything employers do within the organization must, by design and default, consider data protection.

Benefits Of Employee Data Protection

Employers that protect their employee's data enjoy benefits such as:

●  Increasing trust among employees

●  Promoting integrity in company processes

●  Gaining a better understanding of personal data and cybersecurity

●  Improving company reputation

●  Compliance with legislation

●  Safeguards digital workspaces by reducing sensitive data loss

Consequences Of Not Protecting Employee Data

●  Fines. Infringement of any of the data protection principles or rights of the GDPR can attract a maximum fine of £17.5 million or 4% of annual global turnover.  

●  Distrust. Employees will have no trust in employers who do not protect their data. This can, unfortunately, ruin the reputation of the employer and company.

●  Low retention rates. Employees are more likely to leave a company if they feel their data is not protected or their data protection rights are violated. It also applies to employers who process data unlawfully.

Final Observation

Learning about employee data protection is important to prevent a data breach. GDPR is the most important law employers should understand to ensure compliance and avoid legal complications.

Reach out to Workpay today, so we can help you understand data protection. In addition, we can help you remain GDPR compliant when recruiting or processing an employee from the EU and drafting employment contracts.

Workpay
Workpay Africa

Workpay is a HR and Payroll software company that offers time & attendance, payroll, human resource, leave, expenses and remote teams solutions to businesses across Africa.

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