Digital signatures to simplify HR administrative tasks

The summer holiday season is approaching, along with the frenzy that comes with it — every HR staff member's nightmare. You have to prepare the leave-request documents for employees, coordinate them with line managers, and finally everyone has to sign them. At a large company with several hundred or several thousand people, where employees may also be spread across different sites, handing out the documents to everyone by the deadline and collecting the signatures is extremely time-consuming. With a digital signature, however, this can be handled faster and more easily. What's more, it's fully compliant with the law.

What is a digital signature?

A digital signature is also called an electronic signature. Compared with electronic signatures in the more traditional sense, the advantage of a digital signature is that it fully complies with what is set out in the Hungarian Civil Code. Under it, if necessary, it can vouch for the digital identity of the people signing the document even before a court. In fact, since digitally signed documents are protected, we can also be certain that no modification was made to the document during or after signing. All this is thanks to the digital fingerprint, which is unique and impossible to alter.

This is how digital signing works with CHEQ

CHEQ and GoodID have joined forces to make HR administrative tasks easier. As a result, digital signing is now available through CHEQ too. In practice it works like this: on the CHEQ interface you send out the declarations and documents to be signed to all your colleagues in moments. Employees receive only their own document, and they can sign it digitally.

During digital signing, employees are taken from the CHEQ interface to the GoodID interface with a single tap, where the signers are identified. Once their digital identity has been established, the documents can be signed easily, instantly and authentically. It's a huge advantage that you only have to go through verifying the signer's identity once; after that, the identified employee can sign an unlimited number of documents.

Digital signing is therefore a convenient solution for HR, management and employees alike.

The HR staff's list of dreaded tasks

Right now the topical subject is summer leave, but as an HR staff member you have to obtain your colleagues' signatures on plenty of forms all year round.

Leave declarations

We're all aware that the number of basic paid days off, which every employee working in Hungary is equally entitled to, is 20 days. Beyond this, however, employees may be entitled to additional days of leave, for which eligibility isn't based only on age. These too must be declared at the start of each year. This can apply to:

• children the employee is raising in their own household, but also
• workers with reduced working capacity.

Tax allowance declarations

• tax allowance for mothers raising four or more children
• personal allowance
• first-married-couples tax allowance
• family tax allowance
• tax allowance for employees under 25

Declarations relating to tax and contribution deductions

In certain cases other declarations may also be needed that help determine the tax payable. Such declarations include:

• the personal income tax declaration of a private-individual lessor
• the declaration on reaching the cap on the social contribution tax (for separately taxed income, such as dividends)
• the declaration for the simplified contribution to public revenues (ekho)

Declarations and documents relating to benefits

These include documents such as:

• cafeteria declaration
• declaration of receipt of the year-end performance bonus
• amendment to the employment contract in connection with a start-of-year pay rise/wage correction

M30 forms and contribution certificates

While some of the declarations mentioned above don't apply to everyone, the M30 form and the contribution certificates have to be issued to everyone. In this case it doesn't matter how old the employee is, what their family and health situation is, whether they can claim cafeteria benefits, and so on. Under current legislation, these documents must be issued to everyone.

What exactly is the M30 form?

The M30 form summarises the taxes and contributions paid by the employer in the previous year. When drawing up and issuing the certificate, great care must be taken to ensure it complies with the requirements of NAV (the Hungarian tax authority), since this document has to be submitted to NAV by 31 January each year. However, NAV only accepts the data content of the issued certificate as valid if it meets the formal and substantive requirements laid down by law. Among other things, this means that the certificate must be signed by both parties. The employer is required to sign it with a company signature, and the employee is also required to indicate by signature that they have received the form. If this is omitted, it's as if they had never received the form.

Use a digital signature so your life ISN'T about piles of paper to be signed

As you can see, at the start of the year a huge number of documents have to be handed over for signing even for a single employee. At large companies, where hundreds or thousands of people work, and geographically dispersed on top of that, making sure every document is signed on time and properly is an enormous challenge.

Below I'll first point out the methods most companies still use even now, even though digital signing is not only possible but also legally accepted. After that, I'll discuss the solution that already uses digital signing.

1. Handling it in person

Despite digitalisation, HR administrative tasks are still often handled in person. So it's no surprise that the forms, declarations and other documents that have to be signed at the start of the year are still handed over, received and signed in person today.

HR staff tend to choose between two approaches. One version is to walk around the work areas and hand out the forms to everyone by name, then walk around again a few minutes later to collect the signed documents.

The other version is to ask every colleague to visit the HR department, or the designated area where the HR colleague awaits the employees signing the form.

Whichever of these in-person approaches we look at, it's extremely time-consuming at a company of several hundred or several thousand people. During that time the HR colleague could be dealing with plenty of more complex tasks instead of playing postman.

2. Postal delivery

If we don't want the HR colleague to deliver the M30 and the other start-of-year declarations in person, only to then collect each employee's signature one by one, we can also choose postal delivery as a solution. In this case the employee's signature can be replaced by a proof-of-posting slip, such as an acknowledgement of receipt.

If you choose this solution, then besides the printing costs (paper and ink) you also have to reckon with the mailing costs (envelope, registered and/or acknowledgement-of-receipt post). The postage for a registered letter with acknowledgement of receipt is 1,240 forints. If you only have to send it to 100 people, that already amounts to a cost of 124,000 forints for the company. But at large companies you often have to send this document to 500, 1,000, 1,500 or even more colleagues, which is already a significant expense for the company — one it could put towards more useful goals.

It's worth digitalising HR administrative tasks wherever possible. This speeds up getting the tasks done and is more cost-effective in every respect.

3. Sending by email

Although it seems very convenient to send out the tax and contribution declarations, the cafeteria declaration, the tax allowance declaration and so on by email, I still don't recommend this solution. Unfortunately, official documents sent by email don't reduce HR administrative tasks. There are two reasons for this:

• At production companies there may be quite a few staff who don't have a company email address, so the form can't be sent to them by email. — according to one survey, 83% of blue-collar workers don't have a company email address
• Documents exchanged by email lose their authenticity; they have no evidential force. Even if you can send the form to every employee by email, you have to get it back signed, and you have to receive it in its original form. A photographed or scanned version isn't acceptable as an authentic document.

So how can you get every document to employees easily and quickly, in a way that lets them return them just as easily and quickly with their legally compliant signature? The answer is the CHEQ internal communication channel and the digital signature feature.

4. CHEQ & GoodID

The question often comes up of how secure it is if a document is sent out through CHEQ. Completely secure! That's because CHEQ is an internal company communication channel based on a closed system, so data can be shared securely and encrypted. A further advantage is that you don't need a company email address to use the tool, yet users can still be identified. In other words, it can't happen that you send the document to the wrong person. On top of that, it's a huge advantage that all you need to use CHEQ is a smartphone, which almost every Hungarian adult now owns.

This secure internal communication channel is complemented by GoodID's digital signature solution. With GoodID, the identity verification essential for signing takes place in moments, and the electronic signature can also be carried out securely. Digital signing done this way, as I mentioned earlier, is fully authentic and complies with what is set out in the Hungarian Civil Code.

If you choose this method for signing forms, certificates and declarations, then

• you save the payroll and HR team a great deal of time and energy — there's no need to spend days struggling with printing, delivery, filing and so on, and the risk of errors is lower too (wrong printout, lost form, document filed in the wrong place, etc.),
• it fully complies with NAV's requirements and the Hungarian Civil Code — the document is credibly signed by every party concerned,
• in the long run you can also cut your costs, since through the GoodID app integrated into CHEQ you can have not only the M30 form but also the other documents requiring signatures (e.g. tax allowances, additional leave days, cafeteria declarations, contracts, etc.) authentically signed by everyone concerned

It's dead simple to use

You may be worried that your employees won't be able to use this feature. Your fear isn't unfounded. According to information published in 2019, 23% of the Hungarian population are digitally illiterate, while 27% are digitally low-skilled.

However, everyone can use the digital signature built into CHEQ.

We've already tested the feature at a few of our clients. Security guards and members of the cleaning staff also used the feature without any trouble, without any prior training whatsoever.

If you'd like to learn more about how it works and how you can make HR administrative tasks easier with the CHEQ internal company communication tool and the GoodID digital signature solution integrated into it, then request our FREE demo.