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Recently, People Managing People spoke to a number of HR leaders about how HR can make a bigger impact in organizations.

Nearly all of them spoke about the importance of using data to drive decision-making, which is commensurate with the rise in the people analytics discipline.

Employee data helps tell a story about what’s happening in your organization and guides your talent management strategy.

But what is employee data exactly, and how do you capture it? Further, what are the ethical considerations and how do you keep the data secure?

Types Of Employee Data

Let us begin our journey through the world of employee data with a closer look at the different kinds of data points we deal with on a daily basis. 

We're not diving into complex data theory here—consider this more like a casual lunch and learn. 

  • Personal Information:

The basics - name, date of birth, address, and so on.

Employment Information:
  • Job description, job title, and department
  • Start date
  • Employment details and status (full-time, part-time, contract, etc.)
  • Compensation details (salary, bonuses, benefits)
  • Work location and office assignment
Educational and Professional Background:
  • Academic qualifications (degrees, schools attended)
  • Professional certifications
  • Previous work experience
Performance and Work History:
  • Performance evaluations and appraisals
  • Work assignments and projects
  • Salary history
  • Promotions and transfers
  • Disciplinary actions and warnings
Time Tracking and Attendance Records:
  • Timesheets and attendance records
  • Overtime and time off requests
  • Employee time and attendance history
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Benefits and Compensation:
  • Health insurance information
  • Retirement plan details
  • Stock options or equity grants
  • Tax withholding information
  • Deductions and contributions
Emergency Contact Information:
  • Names and contact information of next of kin or emergency contacts
Diversity and Demographics Information:
  • Gender
  • Race/ethnicity
  • Disability status
  • Veteran status (if relevant)
Personnel information
  • Headcount
  • Employment contracts
  • Non-disclosure agreements (NDAs)
  • Confidentiality agreements
  • I-9 forms (employment eligibility verification)
  • Tax forms (W-4, W-2, 1099, etc.)
Performance Metrics and Goals:
  • Key performance indicators (KPIs)
  • Goals and objectives
  • Performance reviews including performance data
  • Performance improvement plans (PIPs)
Training and Development:
  • Training history and certifications
  • Skills and competency assessments
Exit and Termination Records:

Exit interviews

Employment length

Termination reasons

Final pay and benefits information

Employee engagement
  • Survey feedback
  • Interview feedback
  • Employee net promoter score
Recruitment metrics
  • Source of hire
  • Job offer acceptance rate
  • Cost per hire
  • Time to hire

The above data can be combined in increasingly advanced ways to improve processes and the overall employee experience.

For example, you might want to look at attrition rates across certain demographics, or if people are leaving soon after getting promoted.

You can then present this data to the relevant stakeholders and allocate resources appropriately.

How To Collect Employee Data

The good news is that collecting all of this data is quite straightforward if you have the right tools.

  • HRIS - This software serves as the backbone of employee data collection by automating and streamlining your HR-related information. Taking care of the storage and management of this data ensures it remains both organized and easily accessible. 
  • HRMS - A comprehensive solution that goes beyond HRIS by integrating with other business functions. It not only helps in data collection but also supports workforce planning, payroll processing, and compliance management.
  • Applicant Tracking Systems (ATS) - Playing a pivotal role in the early stages of data collection, specifically during recruitment, an ATS streamlines the application and hiring process to facilitate data collection on candidates' qualifications, experiences, and interview feedback. This data can then be transitioned into HRIS or HRMS once a candidate becomes a new hire.
  • People analytics software - This software allows you to not only collect but also analyze employee data to gain insights into workforce trends, performance metrics, and predictive analytics. Empowering HR teams to make strategic decisions that drive organizational success.
  • Surveys and employee interviews - Methods like surveys, skip-levels and stay interviews provide you with valuable employee feedback, sentiments, and suggestions. This qualitative data complements the quantitative data stored in HRIS/HMRS and provides a holistic view of employee experiences and perceptions.

Employee Data Best Practices

Managing employee data is a balancing act to adhere to best practices and ensure data security, compliance with regulations, and the ethical treatment of your workforce. 

Data hygiene best practices

Data hygiene is essential for maintaining the quality, accuracy, and usefulness of your data. 

Poor data hygiene can lead to all sorts of errors, inefficiencies, and missed opportunities.

Here’s what to do:

  • Data accuracy and integrity: Maintain accurate and up-to-date employee records. To do this, routinely audit and verify data to ensure its accuracy. Inaccurate data can lead to errors in payroll, benefits, and problems (i.e. disaster).
  • Data retention policies: Develop clear data retention policies that specify how long you will retain employee data and when it should be securely deleted or archived. This ensures compliance with legal requirements and reduces data clutter.
  • Data disposal: When disposing of physical or electronic records, follow secure data destruction procedures. Shred paper documents and securely wipe electronic media to prevent data leakage.
  • Data backups: Regularly backup employee data to prevent loss in the event of system failures or data corruption. Test data restoration procedures to ensure data recoverability.

Security

Security impacts us all, and it’s especially crucial to secure your organization’s sensitive data. 

Here are some best practices to consider when addressing security:

  • Regular data risk assessments: Conduct regular assessments of data risks and vulnerabilities. Identify potential threats and weaknesses in your data management practices and take corrective actions.
  • Incident response plan: Develop and document a comprehensive incident response plan to address data breaches or security incidents promptly. Ensure employees know the steps to follow in the event of a data breach and embed it into your company culture.
  • Cybersecurity measures: EEmploy robust cybersecurity measures, and consider using secure HR software that prioritizes data protection to guard against unauthorized access, hacking, or data breaches.Use encryption, firewalls, and multi-factor authentication to safeguard sensitive information.
  • Access control: Implement strict access controls to restrict who can access employee data. You’ll want to grant access only to authorized personnel based on their roles and responsibilities. Regularly review and update access permissions to minimize the risk of data breaches.
  • Vendor and third-party risk management: If you use third-party HR software or services, conduct due diligence to assess their data security practices. Ensure they comply with the same data protection standards you follow internally.
  • Data privacy compliance: Stay up-to-date with data privacy regulations such as GDPR (General Data Protection Regulation), CCPA (California Consumer Privacy Act), and other relevant laws. Ensure that you collect, store, and process employee data in accordance with these regulations. You’ll need to obtain consent when required.
  • Audit trails and logging: Maintain audit trails and logs of data access and changes. These records can help in investigating security incidents and demonstrating compliance with data protection regulations.

Ethics

Prioritize ethical considerations in all aspects of your data handling to ensure fairness, respect, and trust in your organization's practices.

  • Encourage responsible data practices from the beginning (onboarding) and discourage any misuse or unauthorized sharing of employee information.
  • Obtain informed consent from employees before collecting and processing their data. Be transparent about how their data will be used and provide transparent privacy notices.
  • Training programs to train HR professionals and employees on how to store data and data protection best practices. Foster a culture of data privacy awareness throughout your work environment to minimize the risk of accidental data exposure.

Employee Data: Manage Casually At Your Peril 

In the daily routine of managing a workforce, we naturally gather and maintain a multitude of employee details.

It’s essential to keep in mind that this isn't a casual endeavor to take or leave.

I’m going to be quite strict here, so strap in:

Compliance with state and federal laws governing data collection is non-negotiable. Ensuring that you operate within these legal frameworks isn't just best practice; it's a legal requirement. Not to mention that the legal landscape is constantly evolving, so you must stay informed and updated. 

Equally important is the need to prioritize data security. Safeguarding employee data from unauthorized access, breaches, or mishandling is not just a suggestion; it's an imperative. Employ robust security measures, encryption, and access controls to protect this sensitive information.

Ethics and transparency should always be at the forefront of your employee data management approach. Transparency in how you collect, share, and analyze this data is key to building trust within your workforce.

Yes, managing employee data is a multifaceted task that requires a delicate balance between legal compliance, data security, and ethical considerations. It’s not for the faint-hearted. So, remember, when it comes to employee data, it's better to be overly protective than to take a casual approach. Your employees' trust and your organization's reputation depend on it.

Join The Conversation

Human resources, like the rest of the world, is primed to take advantage of advancements in data capture and analytics.

The People Managing People Community is a supportive community of HR and people leaders sharing knowledge and best practices to take advantage of the latest trends and help you progress in your career.

You might also want to increase your data proficiency by taking one of the following qualifications:

By Finn Bartram

Finn is an editor at People Managing People. He's passionate about growing organizations where people are empowered to continuously improve and genuinely enjoy coming to work. If not at his desk, you can find him playing sports or enjoying the great outdoors.