Protecting the Security of Your Company’s Payroll

by | Jan 15, 2024 | Blog

While it’s highly unlikely that you will be held responsible in the event that a third party hacks your payroll system, a data leak like that will more than likely result in negative outcomes, not only for you and your employees but between the two of you as well.

One of the biggest risks of having payroll information stolen from your company is that your employees will have to deal with identity theft for years to come. Additionally, your employees will likely hold you accountable and responsible for any damage they incur as a result of the data leak, even though they were not your fault.

However, even though data leaks or stolen information is not necessarily your fault, it will be your responsibility to salvage the situation on behalf of your employees. Plus, it may indicate poor data security on the part of your company, resulting in bad publicity for your business.

With proper payroll security, you can safeguard your company’s money as well as the data of everyone involved. So, in order to reduce the risk of serious issues that will cost you time, money and headaches down the road, it’s imperative that you enhance your company’s security measures when it comes to payroll.

Take charge of your security

Payroll is a part of every business, and it contains an incredible amount of personally identifiable information. And while this isn’t new information, it’s unfortunate that there are people out there who use this fact to their advantage. In fact, Forbes says that payroll fraud occurs twice as often to smaller businesses as to larger ones. This often comes down to security measures and the money that goes into them.

So, no matter your budget, what can you do to protect your business from identity theft, loss of information or stolen data? An inexpensive way to take charge of your company’s security is by educating your employees about proper data security measures. Make moves to train your employees on how to spot scams carried out via phishing emails and text messages.

It’s important to remind your employees to regularly alter their login information and professional credentials. A good rule of thumb is to change passwords every 60 to 90 days at a minimum.

This practice can help your employees minimize their risk of being a victim of data breaches or unwanted access to personal information. In the same vein, encourage your employees to opt into multifactor authentication.

Additionally, never leave your computer screen open or visible when you access employee information. People can do many ill-intentioned things with only a name and a Social Security number.

In fact, those two details alone are enough to steal someone’s identity. To protect these details, invest in a physical privacy filter to conceal your screen if you frequently work in open or public environments.

Consider all the situations

Restrict who has access to your payroll information. Ensure that any of your employees who have access to private information first complete a training program that informs them about payroll security measures. Also, double-check that the people who receive this security clearance are trustworthy.

Another thing to avoid when working in public places is a connection with unsecured Wi-Fi networks. Hackers openly operate in public because that’s where they can capture personal information. So, whenever you go online, make use of a virtual private network, and tell your employees to do the same.

Similarly, always log out of email accounts and other work profiles when you are not logged into them on your personal work device. Also, remind yourself and everyone else that logging into your work accounts from someone else’s computer can grant that person access to employee files if you are not careful. Similarly, the device you use might automatically save your username and password without your knowledge.

You should conduct an audit of payroll security. Along with an official audit, talk to your team and ask if they have encountered any system-related issues over the years.

In fact, you should make this check-in as regular as your audits. Employees often develop ways to work with or around issues instead of bringing them to light, so request full transparency from your employees to avoid a security breach.

Think strategically

Allocate payroll duties among different employees. Instead of granting one person total access to everything, divide the responsibilities by asking one employee to handle timecards while another submits payroll and a third issues pay stubs.

By splitting up tasks like this, you can reduce the risk that one employee will change, alter or steal sensitive information from your company. Now, if your payroll department is only one person, make multiple accounts that can handle each part of the process instead.

Not only should you make sure physical copies of business documents are kept under lock and key, but it’s imperative that you consistently update the payroll software you use. When new updates are available, accept them immediately.

Also, if you can, it’s even better to choose software that automatically updates instead of requiring manual approval to do so. That way, you’ll never forget to update the software, because updates will be automated.

It’s wise to work with a payroll service provider that can help you ensure that your payroll data is secure and all personal information remains confidential. Make sure the data you store is also encrypted at every endpoint. Keep in mind that disk-level encryptions can prevent files from being of any use to people who steal company devices like laptops, cellphones or servers.

By encrypting data at that level, you’ll be taking yet another security measure to prevent online database breaches. Last but not least, perform vulnerability scans and penetration tests across your entire network. Make sure there aren’t any holes in your security.

At the end of the day, it is essential that you take a very close look at the security measures you have in place for your payroll data. Doing so can help you determine if there is any possibility of a security breach.

Likewise, you can also determine if there have been any security breaches in the past. Ultimately, it’s better to be prepared than reactive. So if there’s one thing you do, make sure you implement security measures as soon as possible.

If you need help with your payroll, contact the Barnes Group for all your payroll needs.

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