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GDPR and payroll: four years on

15th Jun 2022
Brought to you by
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The payroll solution that provides all you need for Auto Enrolment.

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GDPR came into force in May 2018, introducing new regulations for how businesses manage their data, including payroll. GDPR outlines obligations on how to store data securely, process it lawfully, and the systems needed to deal with any breach. These apply to both to employers who manage and process their payroll in-house, and those who outsource the payroll processing to a third party.

Given the highly sensitive nature of payroll information, managing this data securely is a key responsibility for both businesses and their payroll partners, be they payroll bureaus or accountants. 

Data protection laws cover responsibilities for both data controllers and  data processors. For businesses that outsource their payroll function, the bureau is a data processor and the business is the controller of the data. 

The introduction of GDPR, as well as recent changes in working methods, require teams to regularly reexamine their processes to ensure they are compliant. Here we explore what businesses and their partners need to know, as well as how the right tools can streamline compliance.

How has GDPR evolved in relation to payroll? 

GDPR was a European Union regulation, introduced when Britain was still a member. However, in spite of Brexit, it still applies in important ways. There are now two versions of the GDPR that UK organisations might need to comply with:

  • The UK GDPR, which, with the DPA (Data Protection Act) 2018, applies to the processing of UK residents’ personal data.
  • The EU GDPR, which continues to apply to the processing of EU residents’ personal data.

These regulations require that businesses:

  • Only collect information they need for the specific purpose of completing the payroll.
  • Keep employee payroll information safe and secure.
  • Ensure employees’ data is relevant and up-to-date for the purpose of processing the payroll. 
  • Only hold information they need and for as long as they need it to manage the payroll.
  • Allow their employees to view their personal information that is kept, upon request.

While these regulations seem simple, managing them in practice can present several challenges for teams, especially those working with legacy systems and manual processes. 

Managing access to data – a key consideration – often involves multiple systems, including payroll software, accounting software and expense systems. These may be fed, and information distributed via spreadsheets and emails that contain personal information. The sharing of information or data amongst the workforce could also increase the possibility of a data breach.

Choosing the right systems for GDPR compliance

Effective GDPR management requires full visibility of data for controllers and processors to manage access and security, as well as secure connections to manage the flow of information through the business, and outside the organisation.

Modern payroll platforms such as BrightPay Payroll Software, and its cloud extension BrightPay Connect, centralise your data on a single system, while enabling holistic visibility through direct API connections with your other key systems; from accounting software to HMRC.

By moving to a single system, businesses can simplify their data storage and processing, while effectively managing access for other stakeholders, including finance teams, employees and payroll processors. 

How to streamline GDPR compliance

BrightPay includes a range of security and data management features to simplify compliance and convenience for data processors and owners.

  • BrightPay automatically password protects each payslip to improve security. Meanwhile, BrightPay’s cloud extension, BrightPay Connect, includes an employee self-service mobile app to allow employees to view and download all new and historic payslips, through a bespoke portal.
  • BrightPay features direct, customised API integration with 12 different accounting packages, enabling the secure transfer of data between systems with no need for emails or spreadsheets. 
  • BrightPay Connect automatically secures your client’s payroll data with a historical and chronological set of backups that can be used to restore the payroll information at any time.
  • Users can set permissions according to prescribed roles to manage access across teams and prevent unauthorised access.

Future-proofing your compliance

With shifts in remote working and remote teams, businesses and their payroll providers need to create systems that can manage compliance across multiple locations, teams and platforms. 

BrightPay and BrightPay Connect, our cloud extension, give you the tools to ensure that your payroll data remains secure at every point of the journey, from onboarding to payslip delivery, while also ensuring employees are paid correctly and on time.

To find out how BrightPay can improve the GDPR compliance of your existing technology stack and save you time on managing your data, book a free online demo of our software. We also offer 60-day free trials if you would like to try it for yourself and see how you can benefit from increased security and flexibility.