What is an employee ID number?

An employee ID number is a unique identifier for each employee. They may use this number when entering your company’s workspace or logging into various software. You can use it to track and manage their data or connect it to payroll, sales data and HR documents. 

These codes may help you keep records and personnel files organized and consistent.

Employee ID vs. SSN

A Social Security number (SSN) is government-issued and connects to a citizen’s legal identity for personal finances. It generally involves more confidentiality and is only used professionally for background checks or tax reporting, such as filing W-2s or 1099s. 

Depending on the company, employee IDs typically require less discretion and are only used for work purposes. However, the code can allow access to private company systems or workspaces.

Employee ID vs. employer ID

An employee ID typically helps link a worker to performance data, HR and payroll processing and access to company tools. An employer identification number (EIN) is a nine-digit number issued by the IRS to identify businesses for tax purposes. Businesses can use it to:

• File taxes as a business
• Open a business bank account
• Apply for licenses or permits
• Send official documents to employees

Who’s responsible for assigning and managing employee IDs?

The HR department or payroll department generally assigns and manages employee IDs. Your company might set up employees with their respective IDs as part of the onboarding process. 

Formatting employee ID numbers

There’s no official rule for how to format employee ID codes, which means you can set up your own system. You might use a random mix of numbers and letters, or they can follow a pattern that includes information such as their job title or start date. 

Consider these employee ID examples:

• Employee ID example A: M028
• Employee ID example B: S067

In these examples, the letters represent departments, and the numbers represent the hiring order for each employee. Example A is the 28th employee hired in the marketing department, and example B is the 67th employee hired in the sales department.

Benefits of using employee ID numbers

Consider the following benefits of using employee ID numbers. 

Support for multiple systems and tasks

Employee IDs can help with tasks across most industries, such as:

• Retail: Employees might use their ID number to log into registers, track inventory, apply staff discounts and check their schedule.
• Health care: Staff might use IDs to log patient data, schedule shifts or access medical equipment.
• Logistics: Drivers might scan their IDs when confirming deliveries, clocking in, completing safety checks and tracking vehicle assignments.

Control over access and permissions

You may choose to link employee ID numbers to permission levels for certain areas, equipment, networks or databases. Examples of access control include:

• A salesperson might have access to the Customer Relationship Management (CRM) system but not an employee’s financial records.
• A maintenance worker may have keycard access to equipment rooms but not management offices.
• A remote employee might need to access internal databases, but not ones containing secure information. 

Organization of large business databases

An employee ID system can help keep records and databases organized. With a single ID attached to an employee’s information, you can easily:

• Track job history
• Confirm attendance at work
• Assign benefits
• Manage training records
• Avoid duplicate entries

Reduced risk of identity errors

Some employees may have the same name. By using employee IDs, you can help prevent confidentiality concerns or payroll mix-ups. An employee ID system helps you document each employee separately in your business’s records. This can help avoid costly errors, such as misdirected paychecks. 

Protection of employees’ privacy

Employee IDs reduce the need to use personal information when identifying employees. For example, you may set access levels without using full personal profiles. 

Access control systems

Access systems may block or allow entry to physical locations and digital tools. Connect employee ID numbers to access permissions to control:

• Who can enter buildings, floors or offices
• Who can open secure cabinets or labs
• Who can log into systems or servers
• Who can access project files or restricted applications

Using access controls may help reduce the risk of:

• Theft
• Data leaks 
• Unauthorized logins
• Policy violations
• Security risks

Tips for using employee ID numbers

You can get the most out of your employee ID number system by following these best practices:

• Assign each person a unique number during onboarding
• Use a safe format that avoids personal data
• Establish rules for who creates and manages IDs
• Link ID numbers to time tracking, HR, payroll and access control systems 
• Remove old IDs when a worker leaves to avoid security issues
• Review ID systems regularly to keep data updated