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Europe – Withdrawal of Safe Harbour agreement could impact multinational recruiters

29 November 2013

Following revelations of US intelligence surveillance in Europe, the European Commission (EC) has set out actions to be taken in order to restore trust in data flows between the EU and the US. One of the prominent demands of the EC is the improvement of the Safe Harbour certification scheme, a compliance mechanism allowing European organisations to share data with US suppliers, partners, and group companies, reports law firm Osborne Clarke.

This could have a big impact on the recruitment industry, especially for American staffing firms or job boards with operations in Europe. As well as American employers holding European employee or candidate data on US servers.

Kevin Barrow, Partner at Osborne Clarke, commented: “Safe Harbour is the basis on which many recruiters legitimise their transfers of candidate data to the US, and the holding of personal data on servers in the US. It may be that recruiters, both at staffing companies and in-house, will need to look at new data transfer compliance policies.”

The EC has set out 13 recommendations for the Safe Harbour scheme, and has said that it will assess progress against these in summer 2014. The implication is that if the EC is not satisfied that changes have been made by US companies and authorities, it will withdraw its approval of the scheme.

According to Osborne Clarke, that would inconvenience a large number of US and European businesses and force them towards other costly data transfer solutions; such as Binding Corporate Rules, legally binding commitments companies draw up regarding the transfer and processing of personal data outside the European Economic Area, leaving the Commission open to criticism that it could be about to ‘cut off its nose to spite its face’.

Osborne Clarke’s detailed note on the potential withdrawal of the Safe Harbour scheme can be read here

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