Blockchain in HR: Exploring its Role in Human Resource Management
Ransforming HR Management: The Role of Blockchain in Human Resources photo
By: Natali

Ransforming HR Management: The Role of Blockchain in Human Resources

Table of Contents

Blockchain is slowly but surely becoming more and more common technology in every field, even in human-centered industries like human resources. Some may say there is no need to implement it with statements like “No machine can enhance human relations” or something similar.

But I’m ready to argue with them. Human resources is still the industry that needs to show maximum productivity, yet remain comfortable for each party involved. And the easiest way to achieve it is to implement the blockchain in human resources management systems.

This new technology enhances trust and brings more transparency, yet remaining anonymous where needed. Verifiable records can ensure employers that new staff have the required experience. At the same time, new hires can be sure that the company won’t overburden them with tasks because each responsibility is written in the smart contract that can’t be altered retrospectively.

Check this article to find other ways blockchain can help even the most human-centered industries. Especially, if you are working in human resources or have friends who work there. Share this article to give them new exciting ideas!

Blockchain and Human Resources: An Unlikely Pair

As I mentioned, many people say blockchain and human resources are incompatible. While in reality, they can benefit each other. Trustworthy records can prove the credibility of both the employer and the employee. They will know what to expect from each other.

Blockchain also can simplify the hiring process through instant filtration and verification. HR can quickly check information about potential employees. At the same time, potential and actual staff can verify and track the company’s changes in real time.

It also can save a ton of time in recruiting. Once HR posts the description of their potential worker, job seekers can apply if they are fit for this position. Companies can check what requirements are obligatory and what is just desirable.

Blockchain can ease payroll, even when a company pays in traditional fiat money. The team can mark the work results. Human Resources or another responsible department can check it for accidental errors and send a report to the accountants as the self-executing smart contract.

It automates the process of distributing salaries, bonuses, and benefits. It eliminates the “human error” factor, so employees can be sure they get a paycheck on time.

HR departments can handle sensitive employee data with blockchain. Only authorized individuals will have access to this data. If they need to share some info with other partially approved people in some productivity report or other similar document, HR can send anonymous data. Employees will get more control over their personal information. On the other hand, HR doesn’t need to worry about complying with the latest data protection regulations.

Blockchain also provides space for cross-company collaboration. Many modern industries rely on sharing employee data between organizations. And this decentralized technology can provide a secure and standardized framework for this task. Businesses can exchange verified employee credentials or performance data without compromising privacy or relying on intermediaries.

Practical Applications of Blockchain in HR

HR-related blockchain tools are not some distant future fantasies. Dozens of fabulous services already help companies, HR, and employers build a better workplace for everyone. You can find a job on decentralized talent marketplaces like BitJob or Ethlance. They have a similar interface as most freelancer platforms, so it will be easy to find a job there.

Services like APPII and SpringRole can help you create your professional blockchain profile that you can share as an immutable CV. You can add your educational and work qualifications with different certifications, provide a history of your work experience, and more. Blockchain can streamline the verification of candidate data by storing and sharing verified credentials, reducing the time-consuming manual checks. Try Verif-y and GradBase services to see how decentralized technology can help you in employee verification.

This technology can help you securely save any records, including contracts, performance evaluations, and training certifications. Companies like Workchain, Datum, and Workday are exploring blockchain data solutions for employee records management.

But what about the main thing: salaries? Various blockchain and crypto solutions on the market can automate your payroll. Try Binance, Defiway, or Bitwage for this task. Defiway Payroll tool allows you to automate this process. Employers invite a co-worker to the platform, and employees receive their payout in their preferred cryptocurrency. A built-in Defiway Bridge tool allows cross-chain payrolls. Ensure you both use supported networks: you can find the list on our website.

Challenges of Implementing Blockchain in HR

If you’ve read previous Defiway articles, you know that adoption is the biggest crypto challenge in any industry. And human resources is no exception. Most recruiters are not tech-savvy to the point of average finance industry workers. So crypto enthusiasts will need to spend far more time educating people to help them become more open to new industries.

Check the service's scalability if you want to implement blockchain solutions into your workflow. Some tools can be used with hundreds of thousands of daily users, while some lack this scalability.

Also, we encourage you to check every security and privacy feature of your chosen service. HR departments must carefully handle sensitive employee data and ensure that personal data is securely stored and can be accessed only by authorized individuals.

As with any new technology, blockchain implementation should rely on current international and regional laws. North America and East Europe are more open to crypto and related technologies, while Central and West Europe prefer to stick with the old-style solutions. Enthusiasts should have their influencers and allies in the political sphere that made standards for HR blockchain apps and will promote them to the whole region or world.

Future of Blockchain in HR

As a crypto enthusiast, I see the future of blockchain in human resources as highly promising. But it will take far more time to implement new tools in this industry. Usually, HR doesn’t need many digital services. Most of their work is human-centered: they are the one who is constantly communicating with other employers. So they are not as tech-savvy as they are online coworkers.

To increase overall adoption we should educate recruiters and build standardized tools that will be accessible both for tech 30 y.o HR and their 45 y.o classic approach colleague. Eventually, in the next few years, businesses will finally understand the benefits of blockchain and crypto and how they can streamline various processes, improve transparency and data security.

We will see how blockchain-based management solutions will become more sophisticated. Employees will have greater control over their data, granting consent for specific data access and ensuring privacy. These solutions will enable secure verification of employee credentials across organizations, streamlining many processes like background checks and onboarding.

Smart contracts will automate administration, ensuring accurate and timely disbursement of rewards, healthcare benefits, retirement plans, and other employee perks. This automation will reduce administrative overhead and provide employees with a seamless experience.

Summing Up

Blockchain has a perspective to drastically change the human resources industry by implementing new secure decentralized services. It can save time in the application, verification, and hiring processes. Immutable profile records will ease CV sharing and job search phases.

The human resources department can securely handle sensitive data, such as personal information or payroll. Moreover, if staff are fine with the prospect of receiving a salary in crypto, you can fully automate this process by using the PayRoll service from Defiway or a similar tool. But we should consider that blockchain adoption will take at least 3-5 more years than in other tech-savvy industries. Most recruiters are people without the tech background, so educating them and showing that crypto is relatable will take far more time. Due to the lack of tech background, we should standardize blockchain in human resources management tools to make them accessible even to the oldest employees.

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