Why International Payroll, Learning and Development, and the Gig Economy Heart Blockchain

2018 seems to be the year in which HR gets serious about blockchain applications in the workplace. In fact, four of the first five emails I opened today had some mention of blockchain, including a range of communications from tech industry blogs to established, white-shoe law firms promoting a new practice area.

Blockchain is a decentralized, worldwide digital ledger of transactions. Decentralized applications (Dapps) through blockchain differ from traditional, centralized servers. The applications run through open source, distributed ledger platforms that are linked through cryptography. Because of the decentralized nature of the platform, any transaction may be independently verified by various sources.

In addition, a transaction, once forming a part of the chain as a block, may not be undone, and any changes to the contents of a block is highly impracticable. This is because the process to add and vet the block is extremely rigorous.

Blockchain’s benefits could affect various industries, from public entities to banking to healthcare.


The allure of blockchain’s secure reporting capabilities – “unhackability”, if you will – has been recognized by local governments and public entities as a key differentiator. South Burlington, Vermont, is participating in a pilot program using the technology for recording and storing information regarding property sales.

The technology has also been used for “smart contracts,” such as nondisclosure agreements, in which the parties submit the contents of the contract to a blockchain. When certain conditions are met in the contracting process, cryptocurrencies automatically exchange “hands.” This process promotes trust and reliability in the bargaining process, whether between employers and employees or between businesses.

Of course, blockchain isn’t perfect: some cryptocurrency exchanges have experienced some trouble of late, and initial coin offerings may prove risky for investors. The Winklevoss twins (of Facebook settlement fame) have invested heavily in bitcoin and developed one of the most successful currency exchanges for cryptocurrencies.

However, cryptocurrencies such as bitcoin have been subject to volatile fluctuations (perhaps making the “Winklevii” millionaires for a time instead of billionaires). Yet the unleashed potential of these currencies continue to keep the Winklevii and other investors engaged and willing to forge into the crypto waters.

Meanwhile, blockchain’s applicability and value-add in the workplace continues to grow.

But some are asking whether HR is ready for blockchain technology. Given its potential benefits for information exchange, the answer should be “Absolutely.”

Gig Economy

Because blockchain makes possible Dapps that may resolve the questions of employee classification, a business may hire a contractor with confidence. This is of great importance for the gig economy, in which companies are hiring gig workers in record numbers. Without an intermediary, the worker (e.g., a driver) and the consumer (e.g., a passenger) may interface directly over a Dapp, with a cryptocurrency exchange to seal the deal.

With such plain dealing on the part of independent contractors, it may become much more difficult to make a wage-and-hour case stick.

Payment of Wages

Just as the payment of wages has developed from a cash-or-check exchange to an online banking interface since the 90s, a reliance on cryptocurrency could be the next phase of payroll evolution. Blockchain technology – as the backer of Bitcoin – has allowed for currency exchanges to simplify payroll transactions by providing an equalizing currency that can then be converted in any employee’s local market. The efficiencies of eliminating processors and intermediaries, as well as diminishing time-zone effects on transactions, make this particularly palatable to those tasked with international payroll processing.


Keeping track of an employee’s growing credentials and learnings could become much more efficient by the use of a Dapp that tracks completed training programs. As the network of users grows, it will be much more efficient to confirm each employee’s training, certificates and other credentials. HR may no longer have to independently verify certifications with an institution of higher learning or a training provider since blockchain has eliminated the need for any middleman.

The ability to verify information by eliminating an intermediary is also highly desirable to those in recruiting and hiring (for verifying an individual’s qualifications and job experience), as well as to others in the organization, such as internal investigators, auditors and mergers and acquisitions attorneys.

Motivating Employees

In addition to tracking an employee’s training journey, blockchain technology can be integrated into learning and development programs in other ways to enhance employee motivation. For example, an employer may incentivize employees to expand current knowledge, skills and abilities by engaging in training in an emerging field.  Then, an employer may offer a financial incentive, paid in cryptocurrency, upon the program’s completion.

Just imagine: your Gen Z employees getting rewarded in cryptocurrency and then using a cash app like Square to make further purchases? Talk about cutting-edge perks.


As with any technological workplace solution, there may be challenges with integration. Transactions may be on different platforms, and some harmonization could be required. As with any emerging technology, entrepreneurial vendors may not have solidified their reputations in the industry, so investment with an unknown firm may be viewed as risky.

Because of these variables, and as with any implementation of a new process or vendor contract, HR should measure the ROI of a proposed initiative.  For some inherently complex processes, such as international payroll processing, blockchain’s promises of security and efficiencies may eventually prove to be well worth the investment.

In the meantime, we in HR should all continue to track possible blockchain applications and communicate with one another on what may or may not work in the workplace of tomorrow.

What do you think about blockchain’s potential to enhance HR systems? Let us know by leaving a comment below.


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