A digital employee file is the electronic version of the traditional paper-based personnel file – it stores all employee-related documents and data in a single, centralised digital location. In Germany, there is no legal obligation to maintain a digital file, but strict requirements under the GDPR and BDSG apply regarding data protection, access rights, and retention periods. Organisations that introduce one gain efficiency and legal certainty – provided they follow clear rules.
What Is a Digital Employee File?
A digital employee file (also referred to as an electronic personnel file) is a software-based collection of all HR-relevant documents and data within an organisation. It replaces the physical paper file or complements it during a transition period. Employment contracts, references, payroll records, and other documents are stored centrally in an HR software system, protected by access controls and archived in a tamper-proof manner.
The term "tamper-proof" (German: revisionssicher) is central here: it means that documents cannot be altered retrospectively without detection. This is important for legal evidentiary purposes and is a key quality criterion for professional HR software solutions.
Digital vs. Electronic Personnel File – What Is the Difference?
In practice, both terms are used interchangeably. There is no legally defined distinction in Germany. Occasionally, "electronic" is used more narrowly to emphasise the legal validity of digitally signed documents – however, this is not a standardised definition. For practical purposes, both terms refer to the IT-supported, centralised management of employee data.
Advantages Over the Paper File
Switching to a digital employee file brings several tangible advantages for HR departments:
Documents are immediately accessible from any location – without physically searching through filing cabinets. Access rights can be defined in granular detail, ensuring that only authorised individuals can view specific information. Retention periods can be monitored automatically and deletion processes initiated in a compliant manner. Administrative workload for HR teams also decreases noticeably, particularly in growing organisations.
Legal Framework
GDPR and BDSG: What Is Permitted?
The digital employee file is subject to European data protection law. The General Data Protection Regulation (GDPR, Art. 5 and 6) stipulates that personal data may only be processed for specified, explicit purposes, must be limited to what is necessary (data minimisation), and must be protected against unauthorised access.
Additionally, §26 of the German Federal Data Protection Act (BDSG) specifically regulates which employee data employers may process within an employment relationship. Processing is permitted where it is necessary for the establishment, execution, or termination of the employment relationship. Particularly sensitive categories – such as health data or information about trade union membership – are subject to stricter rules and may only be processed in exceptional cases.
In practice, this means: every piece of information stored in the digital employee file requires a legal basis. When in doubt, less is more.
Retention Periods at a Glance
Not all documents may be stored for the same length of time. The table below provides an overview of the most important retention periods:
Tip: Modern HR software allows you to set retention periods per document type and automate reminder notifications. This significantly reduces the risk of GDPR violations.
What Belongs in the Digital Employee File?
Standard Documents and Recommended Contents
There is no legally prescribed minimum content for a personnel file – employers decide which documents to include. The following categories have proven effective in practice:
Contractual: Employment contract, contract amendments, termination agreement
Qualifications: References, training certificates, further education records
Compensation: Payroll statements, bonus agreements, tax identification number
Social security: Social security card, health insurance records
Performance: Employee appraisals, target agreements
Disciplinary: Written warnings (including any written responses from employees)
Absences: Sick notes (date and duration only – not the diagnosis)
What Does Not Belong in the Personnel File
Some information must not be stored in the personnel file, as processing it would violate the GDPR or BDSG:
- Religious affiliation or worldview (except for tax purposes)
- Trade union membership
- Detailed health data, diagnoses, or medical reports
- Information obtained through unauthorised surveillance measures
- Private communications of employees
When in doubt: only store data that is demonstrably necessary for the employment relationship.
Right of Access and Works Council Involvement
Right of Access – What Employees Are Entitled To
Under §83 of the Works Constitution Act (BetrVG), all employees have the right to inspect their own personnel file – regardless of whether it is maintained in paper or digital form. On request, employees may bring a trusted person (e.g. a works council member) to the inspection. They are also entitled to request copies of documents.
Employers must grant access promptly. Refusal without valid justification is unlawful.
Works Council: When Is Co-Determination Required?
Any organisation introducing a digital employee file must involve the works council in codetermined companies. Under §87 BetrVG, the works council has co-determination rights regarding the introduction and use of technical devices capable of monitoring employee behaviour or performance – and this includes HR software with a digital employee file function.
Recommendation: Conclude a works agreement (Betriebsvereinbarung) at an early stage. It defines access rights, data storage, and permitted uses, and protects both employers and employees. A well-drafted works agreement builds trust and prevents later conflicts.
Introducing a Digital Employee File – Step by Step
Implementation works best when structured across five steps:
1. Needs analysis: How many employees are there? What document types are involved? Which departments need access? These questions determine the software requirements.
2. Clarify data protection: Involve the data protection officer early on. Create a record of processing activities (required under GDPR) and conclude a Data Processing Agreement (DPA) with the software provider. A DPA is a GDPR-mandated document that governs how an external service provider processes personal data on behalf of your organisation.
3. Involve the works council: In codetermined organisations, negotiate and conclude a works agreement before implementation.
4. Select and configure the software: Look for GDPR compliance, server location in Germany or the EU, tamper-proof archiving, access rights management, and the ability to automate deletion deadlines.
5. Migration and training: Digitise existing paper files (scan and index), train employees, and define clear processes for the ongoing maintenance of the digital files.
For internal application processes and personnel selection, it is worth looking at complementary digital HR processes – such as how the job interview is structured and documented, or how modern Talent Relationship Management should be designed.
Frequently Asked Questions About Digital Employee Files
What is a digital employee file?
A digital employee file is the electronic collection of all employee-related documents and data within an organisation. It is stored in HR software, protected by access controls, and archived in a tamper-proof manner. It replaces the traditional paper file or supplements it during a transition phase.
What is the difference between a digital and an electronic personnel file?
Both terms are used interchangeably in Germany. There is no legally defined distinction. Occasionally, "electronic" places greater emphasis on the legal validity of digitally signed documents – however, a standardised definition does not exist.
Is a digital employee file mandatory in Germany?
No – there is no legal obligation to maintain a digital personnel file. However, those who choose to do so must comply with the requirements of the GDPR, BDSG §26, and BetrVG. Certain documents must also be retained for specified periods under HGB and AO.
What goes into a digital employee file?
Typical contents include employment contracts, references, qualification certificates, payroll statements, social security data, performance appraisals, and sick notes (date and duration only – not the diagnosis). The following must not be included: religious affiliation, trade union membership, or detailed health data.
How long must personnel files be retained?
This depends on the document type: general personnel documents must generally be deleted within 2 years of an employee leaving, pursuant to the GDPR erasure obligation. Payroll records must be retained for 6 years (HGB §257), and tax-relevant documents for 10 years (AO §147). Application documents from unsuccessful candidates may generally be stored for a maximum of 6 months.
Are employees entitled to view their personnel file?
Yes – §83 BetrVG guarantees all employees the right to inspect their own personnel file, even when it is maintained digitally. They may also bring a trusted person and request copies of documents.
Does the works council need to approve the introduction of a digital file?
Yes – in codetermined organisations, co-determination rights apply under §87 BetrVG. It is advisable to conclude a works agreement at an early stage that clearly defines access rights, data storage arrangements, and permitted uses.
How do I ensure my digital employee file is GDPR-compliant?
The key measures are: data minimisation (store only what is necessary), a clear role-based access concept, automated deletion deadlines, a Data Processing Agreement with the software provider, and storage on servers located in Germany or the EU.
Conclusion
The digital employee file is no longer simply a nice-to-have – it is a central pillar of modern HR work. It creates transparency, saves time, and enables legally compliant data management – provided it is introduced in a structured and GDPR-compliant manner. The most important levers: data minimisation, clearly defined access rights, automated deletion deadlines, and – in codetermined organisations – a carefully negotiated works agreement.
Those who consistently digitise their HR processes should also consider modernising their recruiting. The digital platform Aivy helps organisations select talent objectively and efficiently – scientifically validated and GDPR-compliant. Learn more about Aivy
Sources
- General Data Protection Regulation (GDPR), Art. 5, 6, 17. European Union, 2018. https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32016R0679
- Federal Data Protection Act (BDSG), §26 – Data processing in the employment context. Federal Ministry of Justice, Germany, 2018. https://www.gesetze-im-internet.de/bdsg_2018/__26.html
- Works Constitution Act (BetrVG), §83 – Right of access to personnel file; §87 – Co-determination rights. Federal Ministry of Justice, Germany. https://www.gesetze-im-internet.de/betrvg/__83.html
- German Commercial Code (HGB), §257 – Retention of records. Federal Ministry of Justice, Germany. https://www.gesetze-im-internet.de/hgb/__257.html
- German Fiscal Code (AO), §147 – Regulations on retention obligations. Federal Ministry of Justice, Germany. https://www.gesetze-im-internet.de/ao_1977/__147.html
- Digitalisation in HR – Bitkom Study. Bitkom e.V., 2023. https://www.bitkom.org
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