European Union: A GDPR Update For Employers, Part I: Determining Whether Your Organization's HR Data Processing Is Covered

Much has happened since the European Union (EU) General Data Protection Regulation (GDPR) went into effect on May 25, 2018. Many EU countries have enacted national legislation to implement and expand the requirements of the GDPR, while other developments have directly affected employers and created new obligations regarding the collection and processing of human resources (HR) data.

This article, which addresses threshold issues of GDPR coverage, is the first in a four-part series of articles examining national legislation, opinions, and guidelines that have been enacted or promulgated clarifying the GDPR's requirements. Subsequent articles in the series will cover data protection impact assessments, claims alleging violations of the GDPR, enforcement actions, and fines that have been issued.

On November 16, 2018, the European Data Protection Board (EDPB) issued for public comment guidelines on the territorial scope of the GDPR. The EDPB—the successor to the pre-GDPR Article 29 Working Party—consists of representatives from the supervisory authorities or data regulators of each EU country and the European Data Protection Supervisor. The EDPB issues opinions, guidelines, and recommendations for best practices regarding the GDPR.

The EDPB Guidelines provide that the GDPR applies to the processing of personal data in two circumstances. First, the GDPR applies to data processing in connection with the activities of an "establishment" within the EU. An organization will be deemed to have an establishment in the EU if it exercises a real and effective activity through stable arrangements within the territory of the EU, regardless of its legal form (e.g., subsidiary, branch, or office). The presence of a single employee or sales representative in the EU will be sufficient to create an establishment in the EU so long as the employee or sales representative acts with a sufficient degree of stability. However, a non-EU entity will not be deemed to have an establishment in the EU solely because (1) its website is accessible from the EU, (2) it is using a data processor located in the EU, or (3) it is required to designate a representative in the EU.

If an entity has an establishment within the EU, any data processing that is inextricably linked to the activities of the establishment will be covered under the GDPR regardless of where the processing takes place. Thus, if an employer with an establishment in the EU outsources its HR data processing to a third-party service provider, parent company, or other affiliated company, such processing will be covered under the GDPR even though the outsourced data processing takes place outside the EU. Further, if an establishment as part of its business activities in the EU processes the HR data of employees or job applicants who are not located in the EU, then such processing will be covered under the GDPR. For example, if a French parent company processes the personal data of its U.S.-based employees, such processing will be covered under the GDPR.

Second, even if an organization does not have an establishment in the EU, the GDPR will apply to the data processing of individuals who are in the EU if "the processing activities are related to (a) the offering of goods or services, irrespective of whether a payment of the data subject is required, to such data subjects in the [European] Union; or (b) the monitoring of their behaviour as far as their behaviour takes place within the [European] Union."

The Guidelines state that offering employment is not considered to be "offering goods or services." Thus, employers that do not have establishments in the EU will be covered under the GDPR only if they monitor the behavior of job applicants, employees, and former employees in the EU. The Guidelines also provide that data subjects "in the [European] Union" are persons who are located in the EU at the time they are monitored for their behavior. The nationality, residence, or legal status of the individual is irrelevant. Thus, non-EU expatriate employees working in the EU will be covered. Finally, the Guidelines confirm that "monitoring" includes online tracking, closed-circuit television (CCTV) video surveillance, the monitoring of mobile devices, and other offline activities such as the monitoring of health status if the purpose for processing the data is to analyze or predict personal preferences, behaviors, and attitudes.

Based on the Guidelines, the following types of HR data processing are covered under the GDPR:

  • All HR data processing performed by an EU company or a subsidiary or affiliate of a non-EU company located in the EU that employs one or more employees and regularly conducts business within the EU. This is true even if the processing of the HR data is performed on behalf of the establishment by a processor such as a third-party service provider, parent company, or affiliated company, regardless of the location of the processor. Further, data processing of employees or job applicants who are located outside the EU will be covered if such data processing is inextricably linked to the activities of the EU company.
  • HR data processing performed by a non-EU company that employs one or more remote employees or that contracts with one or more sales representatives who exercise real and effective business activity within the EU.
  • Data processing performed by a non-EU company (such as a U.S. parent company) that involves the monitoring of employees based in the EU, including the monitoring of employee computer, email, and Internet usage; the monitoring of employee location data through GPS, access controls, or surveillance cameras; or the monitoring of employees' personal social media accounts.
  • Data processing performed by a non-EU company that recruits job applicants from the EU if the company monitors their behavior as part of the recruitment process (such as monitoring social media accounts) and makes predictions regarding their suitability for employment based on such monitoring.

On the other hand, the following types of HR data processing are not covered under the GDPR:

  • Data processing of EU job applicants performed by a non-EU based company that does not have an establishment in the EU where the company does not recruit and monitor EU job applicants and the EU job applicants simply have access to the company's online application process.
  • Data processing performed by a non-EU based company that does not have an establishment regarding EU citizen job applicants who reside outside the EU and, therefore, are not present in the EU at the time of the collection or processing of their data.

The EDPB accepted comments from all interested stakeholders and citizens on the draft Guidelines until January 18, 2019. The final Guidelines are expected to be issued in the next several months.

Part two of this series will address additional data protection requirements imposed by individual EU Member States implementing the GDPR.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
Klein Moynihan Turco LLP
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Klein Moynihan Turco LLP
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions