Electronic signature software—or e-signature software—digitizes the process of signing documents. It can save time, paper, and other logistical costs for your business. Some solutions offer advanced features including ID verification and SMS notifications.
In HR, e-signatures are often used to sign employment contracts during onboarding. They can also be used when employees change job titles, sign Non-Disclosure Agreements (NDAs), and in other cases where they may need to sign a document.
In particular, companies with remote workers benefit from paperless contract signing. This is because they may have limited office space, or because their workforces can be seasonal or with a high staff turnover, leading to vast numbers of employment contracts.
Electronic Signature Software Benefits
Streamlining the document signing process saves resources and helps other HR processes run more smoothly. Below are the top benefits you can expect to get when using e-signature software.
- It saves time and money. Reducing the time your HR team and employees spend handling paper contracts means you’re reducing the cost of unproductive duties. You can also save overhead costs such as ink cartridges, paper, and printer maintenance, which all add up if you’ve got a large workforce and high staff turnover.
- It’s better for the environment. Wasting paper contributes to climate change by decreasing the tree population by 1 billion trees every year in the US alone. It also contributes to methane gas emissions in landfills. Replacing paper contracts with electronically signed documents can significantly improve your business’s environmental footprint and public reputation.
- It minimizes human error. No matter how professional your HR team is, mistakes happen. E-signature solutions minimize the impact of human error since documents are stored, shared, and signed online.
- It streamlines HR workflows. A streamlined HR workflow increases productivity by replacing manual tasks like sending and checking emails, and filing paperwork. This frees up time to improve relationships with employees and candidates—leading to better onboarding and lower turnover. In addition to this, the data tracked by e-signature software can support other business processes—for instance, signature time stamps can be used as evidence in legal matters.
Features of E-Signature Software
E-signature providers offer different combinations of features, but most of them have a free plan or a free trial that covers basic functions like selecting and signing a signature field and sharing documents by email. Certain features, like advanced ID verification and compliance with regional laws, may be included on paid plans or a business plan.
Largely, you can expect to find the features below in many popular e-signature solutions.
When a document is received by your employee, the e-signature software can guide them through all the fields requiring a signature. Signers can usually draw their signature or select the one automatically created by the software.
Look for products that offer more than one type of e-signature. For example, you may need the signer to input their name in block capitals, initials, and handwritten signature, depending on the contract.
Most electronic signature software has an editing tool so you can make last-minute changes to the document—such as correcting typos or employee pronouns. Some solutions offer collaboration capabilities through which several team members can work on the same cloud-hosted document.
Effective e-signature software tracks the signing status for each contract you send out. This helps your team quickly identify incomplete documents. Additionally, it can help make key decisions, such as delaying an employee’s start date if the contract hasn’t been signed.
Most e-signature solutions feature automated document sharing via email or Google Drive. Signed documents also get emailed to your team automatically. Typically employees can access the document directly from the email or a mobile app, but you can also enable advanced authentication methods such as 2-factor authentication (2FA) and ID verification.
Electronic signature software stores and organizes your documents in the cloud, so they don’t sit in silos on local drives. Anyone in your team with login credentials can work on the stored documents wherever they have an internet connection. You can give bespoke folder permissions to specific coworkers to protect confidential information.
With workflow automation, signature requests are emailed to third parties when document editing is finalized. They sign where required and the contract is emailed back to your team. When both parties sign, they each receive the final signed copy automatically.
In the US, e-signatures are recognized in a court of law if the provider is compliant with the Electronic Signatures in Global and National Commerce (ESIGN) Act and the Uniform Electronic Transactions Act (UETA). In the EU, it should be compliant with the eIDAS Regulation.
In addition to the above, high-risk contracts—such as NDAs—may require advanced security features such as multi-factor authentication (MFA), ID verification, and SSL encryption.
Some solutions—particularly free ones—don’t add time stamps to documents when they’re signed. However, you may need them if it’s a legal requirement to have an audit trail where you work. You may also choose to add time stamps to decrease business risk and increase document validity.
Integrating with other business software can further streamline your HR process. For example, integrating with payroll software ensures workers don’t get paid without signing their employment contract or NDAs.
You may also be able to integrate with employee directory software to import data such as a contact address and phone number.
Electronic Signature vs. Digital Signature
An electronic signature is not the same thing as a digital signature. A digital signature is a type of electronic signature that must include strict identity checks. It must also use advanced encryption to make the signature legally recognizable in official settings—such as a court of law.
By contrast, a standard e-signature—which doesn’t necessarily include identity verification and encryption—is legally binding, but can be more easily disputed in a legal setting.
In some HR cases, you may be required to use digital signatures—for example, when signing formal medical documents or when taking legal actions against an employee.
Electronic signature software helps streamline HR processes by enabling employees to sign digital documents quickly and efficiently. Typically the software will allow your team to specify the required signature fields, send documents via email, collect signatures, and organize documents in cloud storage.
An e-signature solution can significantly reduce manual tasks and the consumption of office stationery. Advanced features—including time stamps, legal compliance, and integration with other business apps—ensure you reduce risk and don’t miss out on valuable HR data.