Is HR Confidential? Best Practices for Privacy in the Workplace

Our 2023 data privacy report found that 80% of HR professionals have either witnessed or been guilty of questionable data management practices. This could mean anything from accessing employee information from a personal device to leaving sensitive details out in the open. Even so, it's important to keep in mind that good data management isn't always digital.

As an HR representative, you have a unique seat at the table. You're tasked with working in your company's best interests, while advocating on your employees' behalf. This means you're the custodians of sensitive information on both sides, entrusted with balancing confidentiality, transparency, and ethical responsibility in the workplace.

Having good confidentiality training programs and policies in place can help you guide the chain of information sharing, either via a device or conversation. Otherwise, you run the risk of breaking more than just your employees' trust in your department.

At BambooHR, we provide a secure, cloud-based HRIS platform that empowers businesses to manage sensitive employee data all in one place. In this article, we'll discuss what confidentiality means in HR and how you can protect personal employee information at your organization.

Why Is Confidentiality Important?

Establishing guidelines for how your organization keeps personal data private and the role you play in safeguarding information helps everyone stay informed and much more. On the "human" side of HR, a corporate confidentiality policy does the following:

• It builds trust. At the heart of it all, trust strengthens the employer-employee relationship. Employee privacy helps people feel confident that their data won't be used against them or for personal gain.
• It helps people feel safe. Confidentiality contributes to psychological safety, which supports a more inclusive workplace where people feel comfortable speaking up.
• It solidifies your work culture. Being transparent about what information is private in HR—and what isn't—takes the guesswork out of everyday interactions, creating a culture where people feel informed, respected, and protected.

Another very important thing to remember is that unlawful employee data handling puts your business at risk. Following strict confidentiality best practices helps prevent hefty noncompliance penalties and legal trouble.

HR confidentiality breaches can also affect your company's sterling reputation. If a pattern of data mishandling or misjudgment becomes public knowledge, your actions could make your customers question whether their information is safe with you or not.

Examples of Confidential Employee Information

Let's look at some of the employee information HR handles each day. From filling out new-hire paperwork during onboarding to applying for FMLA-protected leave, employees give their companies all kinds of personal data, including:

• Birth dates
• Home addresses
• Telephone numbers
• Spousal and dependent information
• Social Security numbers (SSNs)
• Driver's license numbers
• Bank account numbers for direct deposit
• Health-related information

HR also holds personal records related to the employee's work history and employment status, such as:

• Employee performance reviews
• Workplace injury reports
• Background checks
• Disciplinary actions
• Salary levels

A meticulous filing system helps prevent data loss or misuse and makes it easier to comply with potential workplace investigations or labor disputes. Not to mention, it helps ensure your employee records archive fulfills state and federal recordkeeping requirements.

Examples of Confidential Business Information

HR also has the inside scoop on a variety of business activities—a task in which confidentiality plays a big part. A host of sensitive company information that's not yet available to all employees or the public may run through your department, such as:

• Proprietary business strategies and processes
• Merger and acquisition plans
• Pending layoffs and terminations
• Branch openings and closings

No matter what's in store for your organization, navigating "need-to-know" conversations can be challenging. However, knowing what's at stake and how to handle these situations tactfully can help protect everyone involved.

Are HR Conversations Confidential?

Has an employee ever confided in you under the assumption their conversation won't leave your office? Unlike lawyers, therapists, and physicians, HR professionals aren't bound by confidentiality rules in the same sense. This means that disputes between coworkers or employees and their managers aren't always kept behind closed doors—even if the employee asks you not to mention their name or take action.

During an HR investigation for unlawful conduct, for example, you'll likely have to reveal pertinent details with those directly involved as you gather facts surrounding a complaint and resolve the issue. Sometimes, the best you can do is be upfront about what HR can and cannot disclose to other people and your legal responsibilities in any given situation. You can also reassure your employees that you'll only share information as absolutely necessary.

HR Confidentiality Laws

In HR, the concept of confidentiality typically revolves around privacy law and data protection compliance in the workplace. Some of the regulations that govern employee information include:

• Americans with Disabilities Act (ADA): The ADA prevents employers from discriminating against people with disabilities. It also states you must keep all medical exams and details about a person's disability confidential and in a separate medical file.
• Family and Medical Leave Act (FMLA): Allowing eligible employees to take unpaid, job-protected leave, FMLA also emphasizes that health information must remain confidential and separate from regular personnel files.
• Genetic Information Nondiscrimination Act (GINA): Protecting against genetic discrimination in the workplace, this law requires covered employers to keep this information about employees and job applicants confidential.
• Health Insurance Portability and Accountability Act (HIPAA): This law doesn't pertain to employers in most cases, but there are exceptions (e.g., if you obtain protected information through your group health plan). However, it's still best practice to support your employees' right to privacy.

Many states have laws that govern employee information. The California Privacy Rights Act (CPRA), for example, mandates that California employers be clear about what employment-related data they collect and how it's used. Also, international businesses are required to follow the General Data Protection Regulation (GDPR), which protects citizens in the European Union (EU) and European Economic Area (EEA).

What Information Can HR Give Out?

In certain situations, it's necessary to divulge sensitive data within your company. For instance, the Society for Human Resource Management (SHRM) notes that the FMLA and ADA have built-in exceptions. While your HR records must meet confidentiality standards, you can typically let supervisors and managers know about an employee's work restrictions or special instructions in the event of a medical emergency. You may also communicate scheduling changes related to the employee's condition, like taking full or intermittent FMLA-protected absences.

In this case, it's good practice to share sensitive details with caution. Clearly communicate your intent with the employee first and document who will know their personal information, according to your corporate information sharing policies. You may also need to train your managers on how to handle sensitive employee details properly to ensure your employees feel supported by their supervisors.

Manager-Employee Confidentiality Laws

Just like HR, your managers are responsible for respecting their employees' privacy and following the law. Employee privacy laws help prevent personal facts from being disclosed without consent. Employers have quite a bit of freedom, but several laws protect an employee's right to keep private details to themselves.

Some of the most common laws cover workplace surveillance activities, such as web, email, phone, and social media monitoring. Although many of these laws offer limited protection, managers and HR teams still need to know where the lines are drawn. Moreover, many federal and state regulations don't just apply to the HR department—it's everyone's responsibility to uphold the law at work.

Prioritize Confidentiality In Your Workplace

From technology usage to everyday interactions, it's all too easy to leak sensitive data. That's why many HRIS platforms, like BambooHR®, include security measures that control information access. Confidentiality training and policies also put best practices at top of mind, including things like:

• What's considered confidential in the workplace and what isn't
• Appropriate employee monitoring activities
• How your company gathers, uses, and protects sensitive data
• Employee recordkeeping procedures and timelines
• Laws governing employee data privacy
• Guidelines for software admin privileges

When in doubt, always consult your legal and cybersecurity teams for the most current information. Educating yourself, your managers, and your employees about confidentiality in the workplace and using secure HR software are some of the best things you can do to protect sensitive data and your business.