Employment Verification and Data Security: What You Need to Know

Employment and income verification is a benefit that employees rely on when they’re purchasing a home, changing jobs, or requesting government assistance. For most of your employees, these crucial life events do not occur frequently but when they do; it’s important that they’re handled quickly and securely. Many firms over 1,000 employees choose to outsource employment verification which has many direct benefits for employers, from freeing up resources for value-added tasks to ensuring consistency in the information that’s provided to verifiers.

What About Data Security?

Outsourcing employment verification and other critical work functions has proven to be a valuable tool for HR/Payroll departments struggling with an increasing number of organizational responsibilities with a static or shrinking number of resources. But what about data security? Every week there seems to be a new story about a data breach. How is your outsourced vendor managing your payroll data? For those of you not outsourcing employment verification, how are you managing your payroll data?

General Data Protection Regulation

Payroll data security questions will be top-of-mind in 2018 regardless of data breaches due to new European Union regulations coming into effect in May, 2018. The regulations, known as the General Data Protection Regulation GDPR include the requirement for payroll departments to know exactly how their vendors are processing personal data. Even if your company only does business in the United States, these regulations will affect you as domestic regulations will be next.

How You Can Prepare

Here are some ideas that you can use to prepare for GDPR as well as state and Federal data security laws:

1) Determine How Your Outsourced Vendor is Managing Your Payroll Data

Make sure that data is provided securely and discriminately. Some outsourced vendors allow unlimited access to your data from firms such as debt collectors. Is your vendor allowing this? If so, how does your vendor know that the debt collectors systems are secure? If unlimited access is allowed to your data by a customer of your vendor, all of your data is at risk.

2) Learn How You’re Managing Your Payroll Data

If you perform employment verifications in-house, you must ensure that you are securing your data from unrestricted access. You also should be diligent about having an audit trail so you can track all data to know when it was accessed and by whom. In fact, as stated in this article the biggest risks to your business security are your employees.

3) Review Alternatives

Whether you outsource employment verification or not, an employment verification vendor may be able to assist you with your process. For example, your vendor can show you how to utilize employee ID’s instead of Social Security Numbers to fulfill employment verifications. Your vendor can also show you how to implement additional steps to your process to restrict how data is accessed and by whom. Finally, your vendor can help you securely manage your employment verifications in-house whereby your organization maintains payroll data allowing access to your employment verification vendor on a per-case basis.


At i2Verify, we take data security seriously. With our free outsourced employment and income verification service for employers, we immediately save you anxiety, money and time whether you manage the process in-house or not. For more information, please contact i2Verify here.