Privacy, security, and compliance in HR software: what to watch for

As an organization, you want to handle sensitive data responsibly and, of course, avoid hefty GDPR fines. Your HR systems store personal info; think addresses, social security numbers, ID details, absence records, or salary data. You need to treat this carefully. Purpose and legality are two big concepts when dealing with sensitive data. Some data, like tax-related info, you’re legally required to record and keep for a set time. But what about data without a legal obligation? You document all this in a “processing register,” which is the foundation for GDPR compliance.

Mapping out sensitive HR data

In a processing register, you outline what data you store in which system, how long you keep it, why, and who can access it. It also covers the risks of a potential privacy breach for employees and the organization. For each process, you note the technical and organizational measures in place to reduce these risks—like two-factor authentication or restricting system logins to EU countries. User instructions matter too. Can employees use the software on public Wi-Fi, or only with a secure VPN? And if an incident happens, what steps do you take?

Data in your systems and with vendors

The processing register covers personal data in your own systems and those of your vendors, from occupational health services to pension providers. It details which data is used, updated, and stored in which processes and systems, including the geographic storage location. As an organization, you’re responsible for all your sensitive data. The register gives you a clear view of the what, where, who, why, and how long of “your” data, plus insight into risks.

Reasonable retention periods for HR data

Creating a processing register is a lot of work and forces you to think hard about how you handle personal data. It’s tempting to keep all employee data forever, but that’s often unnecessary and sometimes even prohibited. Tax data, for example, has a strict legal retention period, but for many other types of data, the rules aren’t as clear.

Regularly clean up HR data

The idea is to keep only what’s truly needed for good business operations. That sounds broad, but it hits the core. Why hold onto absence records or performance review notes for 20 years? You don’t always need that, even for building a case file. A few years of history is usually plenty. Look at what courts and legal rulings consider reasonable retention periods. So, clean up your data regularly and only keep what’s required or genuinely necessary. Also, document who handles the cleanup and how often.

Who gets access to HR data?

Access to HR data is another thing to think through. Say you’re a national organization with regional HR advisors. Do all advisors need year-round access to employee data nationwide to cover for each other during vacations? That’s hard to justify under GDPR. It’s more reasonable to grant temporary access to another advisor only for as long as it’s needed for business purposes.

The question behind the question

Here’s a real-world example: a director wants a dashboard to drill down into individual performance reviews and ratings. GDPR might not explicitly say this role can’t access that data, but it’s still a privacy breach for employees. To make smart decisions about data access, consider the question behind the question. Why does someone want to see certain data? Will it answer their underlying need? Is accessing a performance review, for instance, necessary to address the director’s business question? In most cases, diving into individual files isn’t needed.

Set up new HR systems right from the start

Switching to a new HR system? Make sure privacy, security, and compliance for your HR data are handled well by default, and identify where you still need to focus. What gaps does the software have? This varies by vendor. It’s smart to create a checklist of questions to go through and discuss with your team.

GDPR-proof testing with test data

When setting up a new HR system, you’ll likely run tests. But how do you test something like onboarding with a fake social security number? That’s a common struggle. Start by clarifying what you want to test. Then, create a GDPR-compliant test set with personas. It takes prep time, but it ensures you’re not testing with real personal data, which isn’t allowed and shouldn’t be done. Would you want your name, address, birth date, or social security number used for testing in various systems?

Keep checking privacy, security, and compliance

Finally, regularly check if you’re handling HR data the right way. Look at what data you have, how long you keep it, and who can access it. It’s a lot easier if your HR software makes it simple to get answers to these questions. Don’t hesitate to ask vendors about their system’s capabilities when exploring new HR software. Does it have a dashboard that clearly shows all details about stored HR data? Can you easily select and delete documents older than five years with a single click, after checking for exceptions? Can you quickly see who has access to what without digging through an authorization chart? Again, think about what you want, why, and what’s needed to meet GDPR.

Need help making your HR system GDPR-proof? Looking for extra (temporary) expertise? We’re happy to work with you, within your resources and budget.