Blockchain applications in Human Resource (HR) Management

Employees being the crucial bearers of technology, knowledge, and service, represent the core component of any enterprise. Nothing can substitute the significance of human resources for the continuing development of an organization, and therefore it becomes very important for an organization to verify the authenticity of human resources before hiring them.

Hiring employees

When an individual applies for a new job, he needs to submit his CV describing his complete history, including personal details, education details, previous work experiences, etc. These details are then checked by the HR officials of the organization. This a quite a lengthy process, as the HR office needs to verify the credentials of an individual mentioned in his CV.

But with blockchain, the complete history of the applicant will be available on the shared ledger. This includes and is not limited to his education certificates, acquired skills, workshops or conferences attended, contact information, his previous work experience, all his promotions, appraisals, appreciations, awards won in the previous organizations, and even the reason for leaving the previous organizations. Before interviewing suitable candidates, organizations can pull all their history from the blockchain as that will help them to make better decisions during the hiring process.

History of the applicant on Blockchain

Employee life cycle

The current procedure to onboard new recruits is quite a lengthy and tedious process. When an organization hires an individual, there is a lot of paperwork that he needs to complete, like submitting his previous records, signing job offer agreements, signing Non-disclosure agreements, etc. The paperwork and multistage approvals continue throughout his whole employment life cycle. For example, when he switches his role or department, gets promoted or when he quits the company for a better career opportunity, he must go through a multi-level approval process.

Further, when he joins the new organization, he has to go through the entire process again. He has again to submit all his documents to his new employer.

But with the implementation of blockchain, complete information of an individual will be available to the potential employer. Thus, reducing the time and energy spent on the validation and verification of an employee and therefore streamlining the whole HR process.

Automating taxes

In the current scenario, estimating and calculating the annual taxes is a pain for any employee. And it is an even bigger headache for the contract workers due to a higher degree of the complications involved.

Blockchain can make life easier for everyone. The smart contracts would work as fair accounting systems that would calculate the taxes for individuals, which can be easily audited by everyone on the blockchain network like employees, tax departments, etc.

Employee’s salary, savings, donations, exemptions, investments, and other sources of income can be recorded on the shared ledger. As a result, and based on this available information, his tax amount will be calculated and deducted at a predefined time without the need for any manual intervention.

Tax information of employees on Blockchain

Replacement of work contracts

Even today, the majority of organizations have all of their employee agreements on a piece of paper, and the HR department is required to validate and maintain these agreements. But with smart contracts, everything can be made seamless. All the agreement conditions can be predefined in a smart contract, and when the decided conditions are fulfilled smart contract gets executed automatically. For instance, if an employee’s promotion or bonus conditions are fulfilled, the smart contract will get executed and an automatic bonus amount or promotion orders will be released to the respective employee.

Promotion or bonus payment through Blockchain

If an organization is required to hire a person on a contract basis, the work conditions and payment terms can be predefined in a smart contract, and when the predefined conditions are met, the smart contract will get executed and an automatic payment will be released to the contractual resource.

Attendance and wages of employees

Blockchain technology can be used to store biometric data of employees such as fingerprint or iris scans. The attendance of employees can be stored and tracked on the shared ledger. Expenses done by employees for their official work can also be recorded on the Blockchain. Having a transparent and immutable record will make it much easier for the employees to get quick approvals and claim their expenses from the concerned department.

Today, if an employee has to claim for the official expenses, he has to go through a series of stakeholders to get the required approvals. This, in turn, becomes a frustrating and tedious task for an employee and also affects his work efficiency as a lot of time is wasted in getting these approvals. Claims can readily be settled as chances of fake claims will be negligible owing to the transparent and immutable characteristic of the Blockchain. This would decrease the unnecessary hassle for an employee, and he can devote his precious time in productive project work.


An essential and significant task of the Finance and Human resource department is to release employees’ salaries on time after verifying their attendance and other perks that they receive. If all payroll conditions are defined on the smart contracts, salaries will be automatically released to the employees at the end of the month or week as predetermined. Thus, streamlining the complex management process.


From a compliance perspective, Blockchain can help organizations to know the provenance of a particular item and to validate its authenticity. Let’s take an example of a pharmaceutical company; when the raw materials arrive for the manufacturing of drugs, the concerned department of the company needs to verify the authenticity of the raw materials received. Through Blockchain technology, it will become easier for them to validate if the supplier has sent the authenticated raw materials. Furthermore, after the drugs get manufactured, they need to arrange and keep a track of the logistics, product delivery, etc., which requires a lot of manual work, phone calls, emails, etc. But through Blockchain, they can keep a real-time track of the product’s journey, thus simplifying their task.

Real-time tracking of a product on Blockchain

Rating employer and organization

Every individual who applies for a job in a new organization wishes to know about the work ethics, culture, and reputation of that organization. He also wants to know if there are any challenges that he may face after joining the organization, like getting delayed salaries, work-life balance, working weekends, etc.

In another scenario, if an employee is not satisfied with his organization and finds some practices unethical, he should have a platform to rate his company and raise this concern without revealing his identity. But at the same time, the anonymous rating doesn’t give the required credibility to any rating or review as many times these are also fake.

Blockchain offers a platform where an employee who has worked or is working can rate that organization without revealing his identity. Through Blockchain it can be verified that the reviewer has worked or is working with the company, but his identity won’t be revealed. With such a platform in place, it would be much easier for a potential applicant to know the true picture of the organization and make a better-informed decision before joining any employer.

If you liked this article and want to know more about Blockchain, NFTs, Metaverse, and their applications, click the below link.

Happy learning!



Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store