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HR DATA SECURITY: SAFEGUARDING SENSITIVE EMPLOYEE INFORMATION

04 • 26 • 22


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HR data security breaches are bad news for your business in countless ways. Bad
PR for your company, big problems for your employees, compliance fines and
lawsuits.

But HR data security is not just a matter of protecting your company from
liability and bad publicity. It’s about doing right by your employees,
protecting their personal information from potential misuse.

Employees will notice when your company consistently watches out for their best
interests. Take care of your HR data security and let your employees keep taking
care of business.

Protecting your company’s sensitive information must be a top-of-mind concern.
HR must have a plan, great communication, proper training, and HR software that
guarantees HR data security and remains up-to-date with current cyber threats.


WHAT KIND OF HR DATA IS SENSITIVE?

Hackers with access to employee information can do a lot of damage with just a
few pieces of information, most notably identity theft. Here is some of the
employee information that employers must keep protected:

 * Payroll information, such as bank account numbers 
 * Basic employee information, including Social Security and driver’s license
   numbers
 * Employee benefits and healthcare information
 * Employee medical issues, including FMLA
 * Compensation data, such as salaries, raises, bonuses, etc.
 * Performance review and termination records
 * Workplace complaints and disciplinary actions
 * Drug and alcohol testing 
 * Workers’ compensation
 * Confidential company planning, like layoffs,expansion, and restructuring 


HOW CAN YOU PROTECT SENSITIVE HR DATA?

PARTNER WITH IT, LEGAL, AND SECURITY TEAMS

Unsurprisingly, this is an area where you’ll need help from experts. Start by
talking with your IT staff about network security and basic protections like
firewalls. How secure is your computer network and company hardware?

Talk to the legal team or obtain outside legal advice about your company’s legal
obligations, compliance concerns, and overall liability issues. Additionally,
approach this as preparing for the worst case scenario—if a data breach did
occur, what steps must be taken.  

On-site IT and security staff cannot check every USB drive and laptop for
unauthorized files, but they watch for suspicious behavior and unauthorized
personnel. With the increase in ransomware attacks, it’s important to note that
networks are very difficult to protect from anyone with physical access to your
computers.

ENABLE APPROPRIATE PERMISSIONS

Managers and some supervisors will need broader access and permissions on
company software than everyday employees. Rather than granting everyone
unnecessarily broad access, make sure you’re only granting permissions where
needed.

SET APPROPRIATE EXPECTATIONS

Even with a stellar IT department, your network can be vulnerable if employees
make unwise or uninformed choices. Workers without computer security training
may not understand the reasons behind certain rules. Work with your IT
department to develop clear rules for employees. Be sure to include this
information when updating your employee handbook. 

REQUIRE STRONG PASSWORDS

Your employees will need to create complex and secure passwords, but some may
attempt to reuse the simplest password accepted by your system. You should
require capital and lowercase letters, numbers, and symbols. Your system can
also require employees to regularly create a new, unique password, including
monthly or quarterly.

NO PASSWORD SHARING (NO EXCEPTIONS!)

Employees should not be allowed to share or exchange their passwords. Mutually
used software and applications should require individual logins, not joint
access for multiple people. 

The motivation for sharing passwords varies widely, from simple convenience to
cheating the time clock. But your network is more secure when each employee and
workstation only accesses a limited, discrete portion of the system.

UTILIZE MULTI-FACTOR AUTHENTICATION

Mobile notifications and biometrics can seem extraneous, but they make a big
difference with network security. Periodically have your employees use an
authenticator app or at least a text message confirmation to confirm their
identities, especially when employees work remotely.

ENCRYPT SENSITIVE INFORMATION

Encryption is essential for protecting your company’s data, like when it’s being
transferred through external servers and email. A single excel spreadsheet could
contain personal data about hundreds of employees or clients, which is why it’s
so critical to protect those files.

The general public is increasingly aware of and drawn to encrypted communication
tools, which means your employees are too. Help employees feel safe and secure
by utilizing encryption throughout the workplace as well. 

PROPER DATA DESTRUCTION

Even printed records and spreadsheets can be vulnerable. Develop protocols for
shredding sensitive documents like old tax records and data concerning former
employees. Make sure those policies are included in your employee handbook.

Digital records also need to be properly destroyed, not just forgotten in the
recycle bin. When old laptops and company hard drives are disposed of, work with
your IT department to make sure that sensitive data is fully erased. A formatted
hard drive might seem to be wiped clean, but files can frequently be recovered
with special software.

MAKE SURE HR/PAYROLL SOFTWARE IS SAFE AND SECURE

Find out whether your payroll software is cyber ready. HR and payroll software
has some of the most sensitive data about your employees, including taxes and
bank account information. The right HR software can massively improve the
efficiency of your in-house paperwork, and it’s worth investing in a secure
provider (like Netchex).

READ MORE: SAFE AND SECURE: HOW TO FIND A TRUSTWORTHY PAYROLL COMPANY

New operating system updates might cause a problem with your company’s
proprietary software, and you need regular testing to identify bugs. To minimize
incompatibility issues, consider getting all of your HR software from the same
company. At Netchex, we just happen to offer a full menu of today’s best
software solutions.

CONDUCT REGULAR SECURITY AUDITS

Most companies conduct audits of some kind or another, particularly with
financials. Conducting an audit of your HR policies, procedures, and security is
just as valuable. An HR security audit can help you assess the important factors
needed for creating a secure company, such as improvement insights, potential
oversight, and up-to-date information on threats.

ROUTINE DATA SECURITY TRAINING

Your employees will need to be trained on password rules and any new data
security policies, but you should also make data security an ongoing topic for
future training. It’s impossible to guess what threats will be your biggest
concern a year or two from now. With additional training, your employees should
have better instincts for avoiding phishing emails and future scams.

PROPER EMPLOYEE OFFBOARDING

Offboarding is just as important as onboarding. Similar to how you grant new
hires access to company software, you will need a schedule for blocking the
access and permissions of departing employees. 

Make sure you’ve collected company hardware, physical keys, and ID badges that
could give a non-employee access to your building or network. Add these steps to
your employee offboarding checklist.


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