As digitalisation in the working environment strongly increases and remote working is on the rise, personnel files are also increasingly being maintained in a digital format. This offers significant advantages to companies. In addition to more flexible access and cost savings, these include above all the structured and simplified search for relevant documents using a search function. The same criteria that apply to personnel files in paper form generally also apply to files kept electronically. However, the introduction of digital personnel files can also involve risks for employers. The following contribution will provide a brief overview.
As part of their entrepreneurial freedom, employers are free to decide whether to keep personnel files electronically or in paper form. Just like paper files, digital personnel files may include all the information about an employee that is directly related to the employment relationship and in whose collection the employer has a legitimate objective interest. The latter is of particular importance due to the increased potential risk of unauthorised access to data.
In order to comply with the principle of completeness, employers must ensure when introducing digital personnel files that all HR processes are recorded electronically and that the documents can be accessed at all times.
It should be noted, however, that certain agreements must comply with the written form according to Section 126 German Civil Code (BGB) in order to be valid. This applies, for example, to the conclusion of fixed-term employment contracts (Section 14(4) German Part-time and Fixed-term Employment Act (TzBfG)), agreements on post-contractual bans on competition (Section 74(1) German Commercial Code (HGB)), as well as cancellation agreements and notices of termination (Section 623 German Civil Code (BGB)). An employer who wishes to rely on such an agreement must be able to prove in the event of a dispute that the agreement was entered into in compliance with the written form. A digital document alone is currently not sufficient to furnish this proof. In the event of a dispute, it may thus be difficult for employers to provide the required proof if they can only present scan copies of the relevant documents and the employee claims that the presented copy does not correspond to the original, or that a document that complies with the written form has never existed. In light of this risk, employers would be well-advised for the time being to continue to keep the originals of all documents that are subject to the written form requirement even if introducing digital personnel files.
However, as the digitisation of records advances, some authors take the view that the presentation of printouts from the digital personnel file could also suffice for evidentiary purposes, provided that initial compliance with the written form was adequately and comprehensibly documented by separate declarations. For example, the employee digitising the original for inclusion in the personnel file could confirm the existence of the original by including a digital note to this effect in the document. Furthermore, the employer could obtain a separate confirmation from the employee acknowledging that the employee received an executed copy of the original. This confirmation would then also have to be included in the digital personnel file.
Employers are obliged to treat the contents of digital personnel files as confidential and to also require their employees responsible for handling such files to treat them as confidential. With this in mind, the group of employees responsible for the keeping of personnel files should be kept as small as possible. To ensure confidentiality, clear authorisation structures need to be created, and the persons authorised to access the files expressly designated and instructed. In this context, it is also necessary to be clear about the access rights (read, edit, save) granted to each individual user. In addition, employers are obliged to encrypt particularly sensitive data, such as information about an employee’s physical, mental and emotional condition.
Employees may, at any time, inspect their complete personnel file and request information about the personal data stored in relation to them (Section 83 German Works Constitution Act (BetrVG)). If the personnel file exists as a digital file and displaying it on a screen does not suffice, the employee may request a printout of the relevant file.
If an employer decides to introduce digital personnel files, it must observe the works council’s rights to participate, if any. Pursuant to Section 87(1) no. 6 German Works Constitution Act (BetrVG), the works council has a co-determination right in matters relating to the introduction and use of technical devices designed to monitor the behaviour or performance of employees. Digital personnel files are such a technical device within the meaning of Section 87(1) no. 6 German Works Constitution Act (BetrVG). As long as only so-called status data (e.g. address, marital status, qualifications/degrees and professional career) is collected and processed, a co-determination right under Section 87(1) no. 6 German Works Constitution Act (BetrVG) does not exist. By contrast, a co-determination right exists if the digital personnel file has been programmed in such a way that the status data can be combined with other data and this allows inferences to be drawn about the behaviour or performance of individual employees.