5 Ways Blockchain Will Affect HR
The term "Blockchain" is one that many associates with Bitcoin and other cryptocurrencies. But, it is set to affect other parts of human endeavors. One of the most prominent units this advancement will revolutionize is human resources. It's no news that HR is an essential sector in any organization. These professionals handle sensitive user data, recruit employees, and manage payments. So, how exactly will the blockchain affect this department? Here, we explore the blockchain and list ways it will affect human resources.
How Will the Blockchain Affect Human Resources?
Blockchain will change several things in the HR sector. Below are five areas the technology will affect:
- Improvement of recruitment processes
- Use of smart contracts for a better customer relationship
- Faster and easier auditing processes
- Delivery of employee bonus
- Protection of user information
Improvement of Recruitment Processes
It takes a lot of time and resources from the HR department to recruit new employees. As a result, several companies outsource the work to third parties or recruiters. But, due to the high costs associated with these strategies, it may be counterproductive. Once companies decide to use the technology, there'll be a lot of recruiters giving up their posts. In other words, there'll be no need to hire professionals to recruit prospects. Blockchain will be most beneficial for cryptocurrency jobs available on platforms like LaborX, where you can get paid in crypto. Also, blockchain will make it easy to accept, and process crypto work offers for job seekers. As time goes on, resumes will also be a thing of the past. Instead, companies can verify individuals' credentials, employment history, and experience on the platform.
Use of Smart Contracts for a Better Customer Relationship
Several organizations are already using smart contracts in their firms. The technology creates a contract between the employer and the employees. Once the employees have performed their duty, the contract pays them. With this, there'll be no need to queue at an HR department waiting to collect the month's earnings in an envelope. Plus, payments of wages will be faster. It will also cut cases of bosses cheating their workers. In the same vein, employees must fulfill their duties to the latter as stipulated in the contract. The contract will also contain measures to take if an employee defaults. The removal of the HR department also reduces cases of fraud in big-time companies. Smart contracts make for transparent transactions in cases of buying and selling. Customers can rest assured that the company will deliver as agreed in the contract. It also allows both parties to customize the agreement with terms that favors them. Aside from this, customers cut down excess transaction fees. It also saves them the hassles of dealing with third parties.
Faster and Easier Auditing Processes
Businesses and individuals alike must deal with taxes. Since tax regulations are changing, HR professionals have a lot on their plate with taxes. The HR business notices blockchain's potential to record and amend employee tax provisions. Blockchain platforms will soon be the best for HR because they can ease the taxing process. Of course, no firm likes to face audits, but it happens all the time. An audit can be so intimidating and tasking. As a result, many firms spend too much time, effort, and money to maintain physical records. The blockchain allows a corporation to share its details with authorities without stress. This results in a reduction in both time and money spent on documents collection. The blockchain's cryptographic hashes also make it hard for anyone to falsify documents.
Delivery of Employee Bonus
Before hiring, companies state their terms of employment, and HR's job is to follow these agreements. However, there might be errors or improper benefit distribution, affecting some employees. The blockchain eradicates such happenings. Using this platform, HR can efficiently deliver employee benefits. For instance, if an employee's payday is in a few days, HR could use the blockchain to deliver the message timely. Furthermore, it can provide their staff with better bonuses depending on their performance.
Protection of User Information
Human resources departments handle some of the company's most sensitive financial activities. Some of them include payroll, banking, disciplinary records, and performance. Organizations must prevent fraud and maintain security for the HR department's data. The security features of blockchain make it a game-changer for human resources. This is because there'll be fewer cases of data manipulation or loss. Even companies like Lockheed Martin are using the technology as a software security tool. Blockchain technology is best when protecting sensitive employee data from fraud. Even individuals who have access to the blockchain cannot alter its record. This prevents sensitive employee data from being hacked from within or outside.
As you can see, blockchain comes with several beneficial packages for HR. Aside from making the department's job easier, it also protects the interests of its users.
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