Employee data crosses borders more than most companies realise. A payslip generated in Portugal and opened by a manager in Canada, a review stored in a US-hosted HRIS, a spreadsheet emailed to head office: each is a transfer. Laws like the GDPR do not prohibit this, but they require a lawful mechanism for each one and hold the exporting company responsible. It sits within wider data protection compliance.
The main mechanisms
- Adequacy decisions: the destination country is approved, so data flows freely
- Standard contractual clauses: pre-approved terms signed with the receiving party, the most common route out of the EU and UK
- Binding corporate rules: regulator-approved internal policies for transfers within a group
- Frameworks: schemes such as the EU–US Data Privacy Framework
- Local equivalents: China, Brazil and India each have their own approval or contract requirements
What else is required
For EU transfers, a transfer impact assessment of the destination country and any extra safeguards. Employees must be told where their data goes, and vendor contracts must pass the obligations down the chain.
How EOR Providers Protect Your Data
An Employer of Record relationship is a standing transfer in both directions. Ask which safeguards the provider uses, where data is hosted (see data residency), and whether the service agreement includes data processing terms. If they cannot answer quickly, that is an answer.