Security in the Era of Online Payroll


In the ‘old days’ of payroll, sensitive employee information was accessible by only a few people. A small business may have a single payroll administrator and a general manager with access; everyone else was locked out. That is no longer the case in the era of online payroll. Now there are many more people involved. With that increased involvement though comes security concerns.

The good news is that online payroll providers are always working to stay ahead of the game where security is concerned. Today’s online payroll environments are as secure as they can be. Even so, companies can never let their guards down; they must be ever diligent to ensure that data remains secure and private.

Payroll Data in the Cloud

One of the first places we look at in terms of online payroll security is the cloud. It is the cloud that powers service providers like Dallas-based BenefitMall. Payroll in the cloud is more efficient, cost-effective, and error-free compared to older systems that rely on manual time tracking and locally hosted proprietary software.

When the cloud was first introduced as a mainstream data and application environment back in the early 2000s, companies were slow to get on board due to very legitimate security risks. Any thought of sending data and applications into a cloud environment were quickly dashed by security experts who claimed there was no way to protect them. Things have changed.

Thanks to more robust firewalls, better security software, and an even better understanding of how online fraud occurs, the cloud is a much more secure place. Some clouds are even more secure than local networks. To keep them secure, security experts continually work on improving everything from firewalls to industry best practices.

Legal and Ethical Obligations

The era of cloud computing has also created new legal and ethical obligations for both payroll providers and employers. They are legally and ethically required to protect employee information from unauthorized access. So whether it is in the cloud or in a local file on the payroll administrator’s computer, employee information must be kept secure.

Such ethical and legal obligations do not necessarily improve security directly, but they do improve it indirectly. The payroll provider or employer refusing to take responsibility for safeguarding employee information is opening the door to litigation. That’s not something any company really wants to get involved in. Furthermore, a payroll provider found not protecting employee data would be out of business rather quickly.

Employees Are the Weak Link

No set of security strategies is 100% foolproof. In fact, they all have a weak link. The weak link in online payroll are the employees themselves. To understand why, you need to understand that companies like BenefitMall give employees access to their own payroll information by way of online accounts they can access with a computer or mobile device. Employees prone to online carelessness jeopardize their own information.

For example, public wi-fi networks are notoriously insecure. An employee who uses a smartphone to access his online account on a public network is risking exposure to anyone else on that network; perhaps a scammer in the same coffee shop stealing private information while enjoying his latte.

We live in an online world. That is the reality. And with the online world comes very real security risks. But rest assured that payroll service providers are always taking steps to minimize risk. Transitioning to an online payroll provider is not a security risk for your company as long as you go with a trusted provider with a good reputation and a history of protecting client data.

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