Article

Impact of DPDP Act on employee data

By Sameer Avasarala and Kumar Panda

The article analyses the impact of Digital Personal Data Protection Act, 2023 on processing of employee data by businesses for a variety of purposes, including performance assessment, extending various benefits, payroll, legal compliance and occasionally to safeguard employer’s interests. It notes that though consent is not required for processing of employee data for the purposes of employment, many other obligations under the DPDP Act would continue, including additional safeguards required while handling personal data of families of employees. The article further discusses key measures like data discovery and mapping, fortifying documentation, vendor assessment, training and sanitization, which are required to be undertaken by the employers for a smooth transition for implementation of the DPDP Act. The authors highlight that at present there is lack of clarity as to whether contractual hires or employees on secondments would be considered employees for the purpose of exemption from consent, and if processing for the ‘purposes of employment’ would include processing for pre-employment activities. According to them, despite some conceptual similarities with the GDPR, multi-national organizations would still have to undertake certain measures to adopt a tailored approach to complying with the DPDP Act.

Notifications and Circulars

• Companies (Prospectus and Allotment of Securities) Second Amendment Rules, 2023 notified
• Companies (Management and Administration) Second Amendment Rules, 2023 notified
• Limited Liability Partnership (Third Amendment) Rules, 2023 notified
• Exemption from IBC moratorium for transactions and arrangements relating to the aviation industry
• Foreign Exchange Management (Debt Instruments) (Second Amendment) Regulations, 2023 notified
• Centralised mechanism for reporting of demise of an investor through KYC Registration Agencies

Ratio decidendi

• Dues arising from the SEBI order passed after the liquidation commencement date can be claimed from the said liquidation proceedings - NCLT, Mumbai
• Treating homebuyers who have availed remedy under the RERA Act differently from other homebuyers, under IBC, amounts to hyper-classification and contravenes Article 14 of the Constitution - Supreme Court
• Insolvency - Approval by Competition Commission of India prior to approval of the resolution plan by CoC is only directory and not mandatory - NCLAT, New Delhi

News Nuggets

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• Insolvency - Limitation to file appeal commences from date of pronouncement of order in presence of counsel, which can be deemed to be constructive knowledge of the order