Blockchain and its impact on HR roles

Few today will remember the infamous saga of a former IBM VP who falsified his CV to steadily move up the corporate ladder, working at marquee names such as HP and Amicorp, by copying his name on his wife’s mark sheet for a plush Rs 24-lakh per annum job, apart from collecting certifications from reputed institutes like IIM Kozhikode, based on the forged educational qualifications. Ironically, the fraud only came to light after a marital discord emerged which led to the wife spilling the beans on her husband.

The case highlighted not only the rampant falsification of CVs, but also the great need for background checks by HR departments in companies. While today a background check on any potential hire is de rigueur, the average turnaround time for a verification process to be completed is between three to four days. Not only is it time consuming, but it is also expensive as these checks are outsourced to a third party by HR departments.

Blockchain technology offers a way out on both counts – cutting costs and time down to just a few hours instead of days. Educational certifications can now be published on blockchain platforms by the institutes and can be shared directly by the candidates with the companies they are applying to – and since these are encrypted academic credentials, companies can rest easy knowing that what they see on a candidate’s CV is exactly who he/she is brings to the table.

Not only educational credentials, even work histories can be verified via blockchain, increasing the level of trust among HR departments about a candidate’s work experience due to the immutability aspect of blockchain, making both hacking and tampering with the encrypted file almost impossible. Due to the decentralized nature of the blockchain, which necessitates the cross-checking of data by the entire network of users who have access to the encrypted files, any changes made on the blockchain will mandatorily require confirmations from all the users on the network – making falsification of work experience impossible.

But perhaps the greatest effect of using blockchain will be felt in payroll management, which is a function where the roles of both the HR and accounting departments intersect. Through automated and secure payments to employers, suppliers and contractors, blockchain can help streamline payment processes, especially in a country like India where some workers, especially those in the gig economy, may not have bank accounts, which are a must for automated deposits from a payroll system .

Not just workers, even white-collar payroll systems can be streamlined using blockchain, especially when payments are across geographic areas. Blockchain can not only provide a secure ledger for payments, but also capture real-time currency conversion rates and make the payment in local currency.

Many HR functions can actually be automated using blockchain. Take for example employee contracts, which can be converted from paper contracts to digital contracts, making it easier and easier for employers to enforce various terms and penalties.

Blockchain can also be used to execute employee benefits such as triggering an automated salary increase upon satisfactory completion of an employee’s probationary period. It eliminates the possibility of any oversight that sometimes occurs when there is a manual interface involved in payroll systems.

Possibly the biggest change that blockchain will bring to businesses is the creation of job roles skilled in blockchain technology, thereby increasing employment opportunities. And it’s not just the developers, designers or engineers that will be needed for blockchain management – ​​companies and HR departments will also require “non-tech” personnel to understand the finer aspects of using blockchain technology, such as blockchain legal experts to help you navigate this. exciting new technology within the legal framework.

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