Disruptive innovations can change everything in the world. Through the use of “smart contracts,” blockchain has the potential to completely transform the way recruiters source candidates, manage payroll, and assign workers.
Corresponding Coinwire, the decentralized ledger technology known as blockchain, was first applied in the cryptocurrency space. On the plus side, blockchain is a decentralized database of records that cannot be modified and is shared in a way that is distributed across multiple nodes. Immutability refers to the fact that information contained in a block cannot be changed or removed once added to the blockchain.
The human resources sector is expected to adopt some sort of public, no-permission blockchain network to disrupt human resources services such as recruitment, payroll, and training. There are many different applications that could benefit from using blockchain technology.
Employee selection according to blockchain
According to the results of the study, a company suffers an average loss of nearly $14,900 due to a single “bad attitude” (Ahmed, 2019). When it comes to the employment process there are two components that are sometimes misrepresented and below are some of the ways that blockchain technology can assist businesses.
Verification of credentials Using blockchain will eliminate the need for traditional resumes and resumes Using blockchain technology will eliminate the need for traditional resumes and resumes by using a new open platform that allows for fast searching and matching. The data stored on the blockchain is current and includes information about a candidate’s educational background, skills, honors and awards. Reviewing recommendations is simplified through the use of blockchain technology.
employment stories Blockchain technology has the potential to help companies reduce the number of work history frauds, which are often carried out by former employers who have previously verified the information. The medical, pharmaceutical and legal industries, where the stakes are higher and lives are at stake, are prime examples of where this has huge consequences.
Streamline repetitive tasks
The use of blockchain technology has the potential to radically change and significantly improve many of the day-to-day, regular tasks of human resource management. As a result of this streamlining, HR managers will be more productive and free to focus on other areas, resulting in cost savings for companies.
keep tabs on Payroll Despite the fact that virtually all payroll systems in large and medium-sized companies are currently automated, monitoring changes to the system, preventing fraud, tracking time and attendance, payment alternatives, and managing benefits are all possible ways to to achieve this system more robust. Using cryptocurrencies as a medium of exchange for payments can completely eliminate the need for third parties such as banks and other financial institutions, resulting in an increased level of transparency.
education: Blockchain technology has the potential to revolutionize both the way companies train their employees and the way people motivate themselves to learn new skills. When an employee successfully completes a training course or earns certification, a new block can be added to the employee history. This block remains and can be easily validated in the future.
Paper-based contracts, which now require continuous and manual processing, are expected to be replaced by digitally supported “smart contracts” in the near future. Contracts using blockchain technology could be considered smart contracts. These links set out the parameters for transactions and the consequences that would follow if the parameters were violated. These are able to enforce not only the contacts, but also the additional simplified activities based on “if and otherwise”. For example, if something like this occurs, this billing may be triggered.
It is important that the code underlying the contracts is resilient, and it must also be borne in mind that the activities facilitated by contracts cannot be reversed.
The use of technology in human resources management brings with it a multitude of advantages and disadvantages. Facts and transparency are made more accessible via the blockchain technology used in the recruiting industry. In this context, technology not only facilitates the mutual localization of employees and employers, but also contributes to building trust between the two parties.
There are certain downsides or concerns that need to be addressed and they need to be addressed soon. One of them is adding “blocks” that contain the wrong information or transactions, both of which are permanent. The second problem is that the technology is still in its infancy and needs further development. Concerns have been raised about scaling up blockchain implementation as none of the industries are fully implementing it to the fullest extent of its potential. Last but not least, the law firm attaches great importance to complying with the requirements of the GDPR and protecting the confidentiality of the data collected. Due to the fact that it is a decentralized technology at its core, the GDPR recognizes the existence of gray areas when it comes to the security of personal data. For example, any legal entity or individual has the right to remove personal data if it is fraudulently labeled as “the right to be forgotten”, which violates the premise of the blockchain ledger. This right exists regardless of whether the information was uploaded by the legal entity or the individual.
To sum up
In summary, blockchain has the potential to act as a significant disruptor in the field of human resource management, although it needs to be normalized according to the needs and concerns of specific industries.