Transforming How Businesses Deal With Personal Identifiable Information

Published: June 20, 2022

Transforming How Businesses Deal With Personal Identifiable Information

Published on Forbes.com

 

From contactless payments to curbside grocery delivery, the Covid-19 pandemic fundamentally changed the way the world interacts through technology. As we begin the period of recovery, digital identity, in particular, is becoming one of the most significant technology trends in the world today, permeating all aspects of life: employment, finance, dating, education, entertainment and more.

Over the past decade, digital products have become easier to use, more engaging and better suited to individual choices and preferences. While these trends may seem glaringly obvious in the consumer world, they have yet to fully reach the regulated world of screening and vetting. Currently, verification techniques such as background checks rely on tactics that are cumbersome, expensive, slow and, most importantly, insecure. Even when technology is used for verification, it is performed in the same way for dumping too much data digitally.

For businesses and employers, collecting sensitive personal information has become the norm. Yet when you look at the nature and volume of the data collected, you'll see that the risks begin to add up. The number of data breaches in 2021 surpassed that of 2020. According to a 2021 KPMG survey, 78% of Americans express fear about data collection, and 30% outright refuse to share their personal data with businesses. Societal mistrust continues to brew — 79% of Americans say they are not confident that companies would admit to mistakes and take responsibility if they misuse or compromise personal information.

Our current labor shortage is also forcing employers to face new realities of hiring and retaining workers, as shortages are in large part influenced by shifting attitudes about the very definition of employment. For example, the gig economy is expected to grow to $455 billion in 2023, up from $204 billion in 2018. Freelance workers and contractors shouldn't have to choose between flexibility and security when getting verified for a new job. Just as preferences have surfaced for services that are the quickest, safest and most efficient, it is only a matter of time before individuals prefer pathways to employment that are paved with seamless digital experiences.

Additionally, the unprecedented need for labor has forced many businesses to drop background checks altogether, sacrificing safety for speed. But when employers rely on credible information sources and relevant qualifications, hiring can be both fast and informed. Collecting personal identifiable information (PII), like social security numbers, is not necessary for the hiring process.

To potential employees, freelancers and contractors, the ability to prove their trustworthiness without disclosing their PII, including SSN, is a game-changer. Concerned consumers can also find a trusted partner in businesses that place data ownership in their own hands. Restricting the use of PII would maximize the protection of sensitive information while shielding businesses from unexpected legal liabilities.

Data privacy laws are complicated. In 2018, California became the first state to enact a comprehensive consumer privacy statute, the California Consumer Privacy Act. Then Virginia followed suit, passing the Virginia Consumer Data Protection Act. Currently, over 15 additional state legislatures are actively considering privacy bills. All of this change will substantially increase compliance costs and risks.

As the landscape continues to evolve, there are several important steps business leaders can take to get ahead and bring their systems into the modern world:

  1. Privacy By Design: Instead of trying to retrofit privacy on top of legacy systems, companies should evaluate their practices from the ground up and build a system that consists only of verified data. Employers should implement tools that put the individual first without requiring unnecessary data, such as biometric verification with identity corroboration.
  2. Challenging Legacy Process: Management should think critically about existing, legacy HR processes and ensure that all personal data currently collected is vital to the hiring process to avoid any biases in the hiring process or retain applicant's personal information subjecting yourselves to breaches and privacy litigation. The job applicant should be part of the equation to verify their information, and employers should have a playbook in place for opt-in consent. Review all the regulations and legal risks 
  3. Advocating For Your Employees: Businesses should work together with colleagues and policymakers to ensure data portability. When individuals can use standardized, widely accepted systems to verify trust, it prevents the unnecessary transfer of additional information as individuals advance in their careers.

Digital transformation is the pathway to a very exciting future. It holds the promise of sovereignty for the individual, trust for employers and the ease of use we have come to expect in our everyday lives. Businesses that adopt this new model will not only be seen as leaders of consumer privacy but will also have a leg up in a job market that is becoming ever more competitive.

In the very near future, traditional third-party background screens will be a relic of the past, as self-sovereign screenings become visible and accessible to the average consumer. Soon thereafter, the concept of digital identity will be synonymous with privacy and data ownership. That moment will represent a paradigm shift that both individuals, employers and businesses can celebrate.

Endera builds trust in your people, your business, and your future. With speed, transparency, and accuracy, you get actionable information to make critical workplace decisions. Start the transformation today.