A Glossary of Key Terms in Data Security & Compliance for HR Tech

In today’s fast-evolving HR landscape, understanding the nuances of data security and compliance is no longer optional—it’s foundational. HR and recruiting professionals handle a treasure trove of sensitive personal data, from applicant information to employee records. Missteps can lead to significant financial penalties, reputational damage, and erosion of trust. This glossary provides an authoritative overview of essential terms, helping you navigate the complexities of data protection and leverage automation to fortify your HR tech stack.

General Data Protection Regulation (GDPR)

The GDPR is a comprehensive data protection law enacted by the European Union, impacting any organization that processes personal data of EU residents, regardless of the organization’s location. For HR professionals, GDPR mandates strict rules around collecting, storing, processing, and sharing employee and candidate data, requiring explicit consent, transparency about data usage, and robust security measures. Automation tools can assist by managing consent forms, tracking data processing activities, and ensuring data retention policies are automatically enforced, minimizing manual oversight and compliance risks.

California Consumer Privacy Act (CCPA) / California Privacy Rights Act (CPRA)

The CCPA, enhanced by the CPRA, grants California consumers significant rights over their personal information. This includes the right to know what data is collected, to delete it, and to opt-out of its sale or sharing. For HR tech, this means meticulously managing personal data for California-based applicants, employees, and even contractors. Automation is crucial for handling data subject access requests (DSARs), ensuring accurate data mapping, and implementing efficient data deletion processes, allowing HR teams to respond promptly and compliantly to consumer requests.

Health Insurance Portability and Accountability Act (HIPAA)

HIPAA is a U.S. law primarily focused on protecting sensitive patient health information (PHI). While often associated with healthcare providers, HIPAA can impact HR departments when they handle employee health records, wellness program data, or benefits administration involving PHI. HR tech platforms must ensure robust safeguards, including strict access controls, data encryption, and secure transmission protocols, to maintain HIPAA compliance. Automation can help by segmenting and securing PHI within HR systems and ensuring only authorized personnel can access it.

ISO 27001

ISO 27001 is an internationally recognized standard for information security management systems (ISMS). Achieving ISO 27001 certification demonstrates that an organization has implemented a rigorous framework for managing its information security risks. For HR leaders, this signifies a commitment to protecting all types of organizational data, including sensitive HR records. Adhering to ISO 27001 principles often involves comprehensive risk assessments, employee training, and continuous monitoring, areas where automation can streamline compliance checks and policy enforcement across HR systems.

SOC 2 (Service Organization Control 2)

SOC 2 is an auditing procedure that ensures service providers securely manage data to protect the interests of their clients and the privacy of their clients’ customers. It focuses on five “Trust Services Criteria”: security, availability, processing integrity, confidentiality, and privacy. HR tech vendors often undergo SOC 2 audits to assure their clients (HR departments) that their platforms meet stringent data security standards. When evaluating HR software, a vendor’s SOC 2 compliance offers peace of mind, demonstrating a commitment to safeguarding sensitive HR and applicant data.

Data Encryption

Data encryption is the process of converting data into a code to prevent unauthorized access. It’s a fundamental security measure, particularly for data at rest (stored) and data in transit (being transmitted). In HR tech, encryption is vital for protecting candidate resumes, employee personal identifiable information (PII), payroll data, and performance reviews stored in HRIS or ATS systems, and when these data points are moved between platforms. Automated systems can ensure that all sensitive data is encrypted by default, both in storage and during any data transfers or integrations.

Data Anonymization

Data anonymization is the process of removing or modifying personally identifiable information (PII) from data so that it cannot be associated with any individual. This process is crucial for enabling data analysis and sharing without compromising privacy. For HR and recruiting, anonymized data can be used for workforce analytics, diversity reporting, or talent pool analysis without revealing individual identities. Automation can facilitate anonymization by systematically stripping identifiers from datasets, preparing them for secure and privacy-compliant analysis.

Data Pseudonymization

Similar to anonymization, pseudonymization replaces identifiable information with artificial identifiers (pseudonyms). The key difference is that pseudonymized data can be re-identified using a separate “key,” whereas anonymized data cannot. This technique offers a balance between privacy protection and data utility, allowing for more detailed analysis or re-identification when legally permissible. In HR, pseudonymization might be used for long-term trend analysis of employee performance or compensation, enabling re-identification only under strict access controls and specific purposes, often managed and enforced by automated data governance workflows.

Data Minimization

Data minimization is a core principle in data protection, advocating that organizations should only collect and process personal data that is absolutely necessary for a specific purpose. This reduces the risk associated with data breaches and simplifies compliance. For HR and recruiting, this means critically evaluating every piece of information requested from candidates and employees—do you truly need it? Automation can enforce data minimization by limiting data fields in application forms or HR onboarding processes, ensuring only essential data is collected and stored from the outset.

Consent Management

Consent management involves obtaining, recording, and managing individuals’ explicit permissions for the collection and processing of their personal data. This is particularly critical under regulations like GDPR and CCPA. In HR tech, robust consent management means clear consent forms for job applicants, employees, and contractors, detailing how their data will be used, stored, and shared. Automated consent platforms can track consent statuses, send reminders for renewals, and ensure data processing activities align with granted permissions, providing an auditable trail of compliance.

Breach Notification

Breach notification refers to the legal requirement for organizations to inform affected individuals and regulatory authorities in the event of a data security breach that compromises personal data. Timeliness is often paramount, with specific deadlines varying by jurisdiction (e.g., 72 hours under GDPR). HR departments must be prepared for this, especially if their systems house PII. An effective incident response plan, supported by automation, can quickly identify affected individuals, generate necessary communications, and track notification statuses to ensure compliance with legal obligations.

Vendor Risk Management (VRM)

Vendor risk management is the process of identifying, assessing, and mitigating risks associated with third-party vendors who have access to an organization’s data. Given that HR often relies on numerous external HR tech solutions (ATS, HRIS, payroll, background checks), VRM is critical for data security. This involves due diligence, security assessments, contract reviews, and continuous monitoring of vendor compliance. Automated vendor management platforms can streamline this process, tracking vendor security certifications, compliance audits, and data processing agreements, ensuring your HR data remains secure across your entire tech ecosystem.

Incident Response Plan (IRP)

An Incident Response Plan is a documented set of procedures for how an organization will prepare for, detect, contain, eradicate, recover from, and learn from data security incidents. For HR, an IRP is vital because employee and candidate data are prime targets. A well-defined plan, including roles, responsibilities, communication protocols, and technological steps, ensures a swift and effective response to breaches. Automation can play a key role in an IRP, by automatically alerting relevant stakeholders, isolating affected systems, and initiating recovery processes, thereby minimizing damage and downtime.

Access Control

Access control refers to the selective restriction of access to a place or other resource. In the context of HR tech, it means ensuring that only authorized individuals can view, modify, or delete sensitive employee and candidate data within HR systems. This is typically managed through roles, permissions, and multi-factor authentication. Strong access control is fundamental to data security and compliance. Automation tools can enforce granular access policies, revoke permissions automatically upon employee departure, and audit access logs, ensuring that data access is always appropriate and compliant.

Data Retention Policy

A data retention policy defines how long specific types of data must be kept and how they should be securely disposed of once their retention period expires. Various legal and regulatory requirements dictate retention periods for HR data, such as tax records, payroll information, and applicant data. A clearly defined policy is crucial for compliance and minimizing data storage risks. Automation can significantly streamline data retention by automatically flagging data for deletion or archival, enforcing retention schedules across HR systems, and providing audit trails for data lifecycle management.

If you would like to read more, we recommend this article: Keap Data Protection: Why Automated Backups Are Essential Beyond Access Controls