Privacy is critical in the modern digital world. As an employer in Canada, you’ll need a way to safeguard your employees’ and customers’ personal information. With an online privacy policy, your small or medium-sized business (SMB) can fulfill this responsibility, which is crucial for compliance with privacy laws.
In our article, our IT services company in Edmonton and Western Canada will share all you need to know about privacy policies. We will explain what a privacy policy is, why they’re important, and how you can create one for your SMB. Let’s begin with a definition.
What is a Privacy Policy?
In simple terms, a privacy policy is a type of legal document that describes how a company or organization gathers, utilizes, and distributes the personal data of its customers or employees. Not only should a privacy policy refer to the types of personal data the organization collects, but it should describe how the company is collecting it.
So, if a company collects personal data through an essential cookies strategy or a user-submitted form approach, company owners need to disclose that these methods are used to gather the data. Or if a business collects data through an IP address strategy, it needs to disclose that it uses this approach to collect customer information.
At the centre of privacy policies is the need to be transparent when handling data. Privacy policies give users more transparency in terms of how companies use their personal data. They can also give users control over how the data is used.
Why All SMBs Need Privacy Policies
An online privacy policy is critical for all SMBs for a few reasons. As a business owner, you’re obligated to have a privacy policy due to a few legal compliance expectations. But they’re also important if you want to build trust with your customers and to avoid data breaches. So, here we’ll look closely at these reasons to dig deeper into why you need a privacy policy.
Legal Compliance
Key regulations that businesses need to comply with include the Personal Information and Electronic Documents Act (PIPEDA) and the General Data Protection Regulation (GDPR). The PIPEDA Act states that companies in Canada can only collect, use, or disclose personal information that a reasonable individual would consider appropriate in the circumstances.
The data collection process also needs to be lawful. Data can’t be published if there is an intent to charge people to take it down.
The GDPR regulations apply if an SMB holds or processes any data from individuals living in the EU. These regulations state that companies need to have robust processes in place when storing or handling the personal information they collect. So if you sell goods or services to individuals in the EU and receive data from overseas customers based there, your company will need to align its privacy policy with GDPR and PIPEDA regulations.
There are penalties for non-compliance. If your company fails to comply with PIPEDA, fines of up to $100,000 CAD can apply. If your company violates the GDPR regulations, fines of up to €20 million can apply (or 4% of the worldwide annual revenue of the previous financial year). A privacy policy helps you avoid these consequences for non-compliance.
Building Trust with Customers
With a privacy policy in place, your company can reassure customers about how you’re protecting their data. Customers can check how their data will be used and know what they should expect when you collect it.
Your clients also know that businesses with a privacy policy consider themselves accountable for the misuse of customer data. This acknowledgement further boosts customer trust and can lead to better customer retention and business growth.
Avoiding Data Breaches
Although there are other consequences of data breaches, such as financial losses in the case of ransomware attacks and even emotional distress, a privacy policy mitigates these risks in a key way.
Since they set out exactly how the client data needs to be handled, it means that there are no misunderstandings that could lead to a data breach. They also contain retention guidelines related to how long the company can keep the client’s data, which means old data cannot be used and malicious actors can’t pose a threat to a company or breach this type of data.
Key Components of a Privacy Policy
There are a few key components of an online privacy policy that you’ll need to incorporate when creating one for your company. If you’re wondering which components they need to contain, our IT services company in Edmonton and Western Canada has shared those components just below:
- Data collection: The policy needs to state the specific personal data your company will be collecting and describe the reasons why you will need to collect it.
- Data usage: The online privacy policy you create needs to describe how your company will use the data and mention whether your organization will store the data or share it.
- Third-party sharing: Your policy should state whether you will share the data with a third party. If you intend to share the data, you’ll need to state how you will do so.
- Data security measures: Your online privacy policy needs to describe the specific steps you will take to protect the customer information you collect. This might include the cybersecurity measures your company implements.
- User rights: The policy should let users know their rights regarding their data. It should offer clear information on how they can exercise their data rights and, for instance, withdraw their consent if they have a change of opinion.
- Contact information: It should contain further information about your company, specifically the individual user should contact if they have any concerns about the privacy policy.
Steps to Create a Privacy Policy for Your SMB
With the elements in mind, you now know the content your privacy policy will need to contain. But which steps should you complete if you want to create a privacy policy for your SMB? The processes below will help your organization create one.
Utilize a Privacy Policy Template
It all begins with a privacy policy template. Templates can be ideal for the structure of the privacy policy and will ensure you don’t leave any crucial sections out. You can find policy templates for free and at an affordable cost on websites such as lawdepot.ca. Just download your template to start with.
Customize the Privacy Policy
Now you’ll need to tailor your policy to the specific industry your company belongs to as well as the data practices you’ll want to establish. Doing this requires you to research the specific privacy laws that apply to the industry you operate in and then identify the important practices.
One such example is the e-commerce industry. When creating a privacy policy document for a company that belongs to this industry, you might identify how the customer’s payment information is kept secure or how you handle this specific type of data.
Get the Advice of a Legal Expert
Complying with the required personal data regulations is vital, ensuring you avoid fines or data breaches. For these reasons, you should seek the advice of a legal expert when creating an online privacy policy for your SMB.
But it’s especially important to seek legal advice if your privacy policy is particularly complex. Getting the right support can help ensure you cover every key element and avoid any ambiguous phrasing in the privacy policy so that clients are well-informed about how their data is being used.
Use Clear and Accessible Language
But clear and accessible language is important for other reasons when drafting a privacy policy. PIPEDA really stresses the need to use clear language that the average person can understand.
So, to comply with PIPEDA’s regulations, your privacy policy documents will need to be written using language that is accessible. To do so, we advise avoiding legal jargon and instead ensuring the policy contains everyday language that isn’t complex.
Maintaining a Privacy Policy - Best Practices
Once you have written the privacy policy, what remains is the need to regularly update it when there are changes in any regulations or business operations. For instance, if you decide to process data in a different way, this needs to be reflected in the privacy policy.
But at the very least, you will want to update the privacy policy once a year as a rule of thumb. Sticking to this guideline ensures your policy is always up-to-date. At the same time, when there are significant updates to the privacy policy, you will need to update customers accordingly.
You can update your customers with a privacy policy update email, in which you can include a link to the new policy. Keep in mind the importance of simple language when sending this email so that clients understand which changes you are going to implement.
Create a Privacy Policy and Stick to it with Tech Masters’ Support
To recap, a privacy policy is a necessary document that SMBs require to show how they will collect and use customer data. It’s an essential policy, helping you comply with PIPEDA and GDPR regulations, boost your customers’ trust, and show that your business is committed to transparency when it collects personal data.
We highly suggest prioritizing the privacy of your customers and, if you do not have a privacy policy, to begin creating one. If you are seeking support after creating a privacy policy, Tech Masters can help.
We can provide privacy compliance assistance, such as methods to handle data breaches or privacy incidents, and can also help make controlled changes to IT systems so your company complies with privacy laws. Arrange your free consultation with us. Contact Tech Masters for privacy compliance assistance today.
