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Time Tracking and Privacy: What Companies Should Know

Accurate time tracking isn’t just a legal obligation but also an essential component of smooth company operations. However, this requires collecting employee data, which is protected under the GDPR. This poses a challenge for companies to balance compliant time tracking with data privacy. In this article, we explain the measures you can take to adhere to all regulations concerning time tracking and data privacy.

The Intersection of Time Tracking & Data Privacy in Employment Law

The Working Time Act establishes clear rules for time tracking to safeguard employees’ rights. But first, let’s briefly review May 2019: The European Court of Justice ruled that “Member States must require employers to set up an
objective, reliable and accessible system enabling the duration of time worked each day by each worker to be measured.” Consequently, employers are obliged to document their employees’ daily working hours and breaks. Key to compliant time tracking is that the provided system must be easily accessible to all employees and accurately record data.

This legal requirement for time tracking is crucial in terms of data privacy, as employment law forms the legal basis for the collection and processing of work time data.

The Significance of Data Privacy in Time Tracking

Work time data isn’t just randomly collected numbers; they’re digital representations of individual employees’ work, presence, and existence. If this information falls into the wrong hands, it can have serious consequences: from financial losses to reputational damage and even violation of employees’ privacy. Therefore, they are considered personal data and fall under the protection of the General Data Protection Regulation (GDPR) in Europe. Companies must ensure that data processing is lawful, fair, and transparent.

Given the digital revolution, cyber threats are becoming increasingly prominent, making data security an absolute necessity. Data privacy in time tracking involves more than just guarding against unauthorized access. It’s also about ensuring the integrity and accuracy of the recorded information. Inaccurate or manipulated work time data can lead to legal consequences, erroneous salary calculations, erosion of trust in the system, and tensions between employees and employers.

The Employer’s Responsibility

Protecting employees’ time tracking data is not only a legal obligation under data protection laws but also a moral responsibility for employers. Ensuring data security signifies professionalism and offers a way to gain and maintain employee trust. To fulfill the highest security and data protection standards alongside legal requirements, employers must take proactive measures.

7 Aspects of Data Privacy in Time Tracking

Data privacy is essential when tracking your employees’ time. When handling sensitive time tracking data, pay attention to these 7 data privacy aspects:

  1. Purpose Limitation: Clearly state why you want to track your employees’ work time data. Typically, companies use time tracking to fulfill work contracts or comply with work time regulations. However, organizational reasons like process optimization can also come into play. Either way, the collected data must not be used for purposes other than those aligned with the original purpose.
  2. Transparency: Employees should be informed about the data being collected, how it’s processed, and for what purpose. Provide this information through a privacy statement or a separate document, and ensure that your employees have access to it through effective communication.
  3. Data Minimization: Collect only the data you need for the purpose of time tracking. Data privacy also means being frugal, meaning you should never gather more data than necessary. This aspect is particularly relevant when using biometric data (e.g., fingerprints) for authentication in time tracking. For storing and processing this highly personal data, you require your employees’ consent. An exception applies only to locations subject to high-security regulations, such as laboratories or vaults.
  4. Security: Work time data should be adequately protected to prevent unauthorized access, loss, or theft. Implement technical and organizational measures like appropriate encryption, access controls, and regular security audits.
  5. Retention and Deadlines: Determine how long work time data will be retained to comply with legal requirements. According to the law, work time data must be stored for at least two years. Since time tracking is often used for payroll purposes, data can be stored for up to six years. After these periods, data should be securely deleted or anonymized.
  6. Rights of Individuals: Employees have the right to access, correct, or delete their recorded work time data. This applies when data is inaccurate or no longer necessary.
  7. Data Transmission: When transmitting data to third parties (e.g., an external accountant), you must also assess the third party’s data privacy standards. Even if you do everything right internally, your company is responsible for the correct external processing of your employees’ data.

Tips for Enhanced Data Security in Time Tracking

These fundamental data privacy aspects provide a solid foundation for designing a secure and confidential time tracking system. However, there are numerous additional measures that can also make a significant difference. Here are the key tips to ensure secure and reliable time tracking in your company:

  • Implement Strong Authentication: Require secure passwords and consider two-factor authentication (2FA) to prevent unauthorized access to the system.
  • Encrypt Sensitive Data: Ensure that all sensitive data, including personal data, is encrypted. This applies to data transmission as well as storage.
  • Restrict Access: Manage access rights to the time tracking tool and ensure that only authorized personnel have access to sensitive information.
  • Create Backups: Regular backups of all data prevent data loss in case of malfunction or attack.
  • Keep Software Updated: Continuously update your time tracking tool and all used software to stay current.
  • Train Your Employees: Awareness is the first step to secure time tracking. Train your employees in data privacy best practices, such as safe password management or recognizing phishing emails.
  • Choose a Reliable Time Tracking Tool: Opt for a trustworthy time tracking tool with integrated data security features. Check if the tool adheres to international standards, such as ISO 27001 certification.


Efficient time tracking that considers data privacy is indispensable for every company. By using a reliable and certified time tracking tool like TimeChimp and adhering to all GDPR-compliant time tracking tips and aspects, you ensure compliance with all legal requirements. Additionally, you also earn and keep the trust of your employees and customers.

Interested in how we handle your data at TimeChimp? Find out all about it in our Security Statement.

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