Cloud computing, is the use of computing services provided by another company. Programs and data are stored on servers operated by the cloud computing company and are accessed via the Internet. This arrangement can be cost-effective and flexible, but companies must consider several important factors (the first of which is data security) when deciding whether to use cloud computing for sensitive data such as human resources records.

Numerous laws impact a company’s relationship with its employees, and much of the data maintained for human resources’ purposes is sensitive and governed by privacy laws that vary by country. Companies must develop procedures to control access to this information. If a company’s human resources data is stored on the cloud, it is much more difficult to ensure that the data is managed in a manner that meets privacy laws.

A company cannot simply assume that the cloud-computing supplier provides this security. For example, in 2011, German data protection authorities adopted an “orientation guide” to cloud computing that emphasizes that German cloud computing customers are responsible for compliance with all data protection requirements under German law. This compliance includes all subprocessors involved in providing cloud computing services. Thus, it is not sufficient for a company to just accept the cloud computing provider’s assurance that its systems are secure. Cloud computing customers should “access logs, tour the data center, go through data center questionnaires and see who has the administrator’s password,” according to Grady Summers, principal, information security, at Ernst & Young. “Make sure that the service provider can meet regulatory requirements as well.”

-Will laws and regulations affecting cloud-based human resources systems become more standardized and simpler in the future, or will there be a growth in complexity with an increase in associated costs? Provide the reasoning behind your answer.