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GDPR and workplace AI 8 min read

Shadow AI and employee privacy: two interests that do not collide

The organisation wants to know which AI tools are in use; the employee does not want to be tracked. Why there is no trade-off: answering the question requires no names.

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Quick answer

An organisation wants to know which AI tools are in use so it can decide on them. An employee does not want their employer keeping a record of what they do. Those two interests only collide if the organisation answers the first question with data about people. It does not have to: which tools are opened, how often and whether a decision exists are questions about services and about the organisation. A measurement that records only the domain and a count answers them fully and says nothing about who. The same design gives the organisation a view of shadow AI and lets the employee keep their privacy.

01

A view of shadow AI needs tools and counts, not people

02

The employee loses nothing when the measurement contains no user ID

03

Monitoring individuals makes the figures worse, because use moves to personal phones

04

The decision on a tool goes to the employee, the count to the organisation

05

An incident investigation is a separate procedure and does not belong in the measurement

A security manager at an insurer wants to know which AI tools are being used across the organisation and asks IT for an inventory. The same day, HR replies: this cannot happen without the works council, because it means tracking employees. Two emails, and the project stalls.

Both are right about their own interest, and both assume one comes at the expense of the other. That is where they go wrong. The organisation wants to know which tools are in use; the employee does not want a record of what they do. Answering the first question requires no names, so the second concern need never arise.

What does the organisation actually want to know?

Shadow AI is AI use people have taken up on their own: a tool anyone can start using online, that the organisation has not decided on and that is actually in use. Our introduction to shadow AI explains what that means and why a ban does not solve it. The security manager's question is the natural next step: which of those tools do we have, and which ones need a decision?

That is a question about services. The answer is a list of domains, with a count and a status for each: allowed, limited use, no decision yet, not allowed. There is no name anywhere in that list, and none is needed. The insurer remains the controller for what happens inside those tools, so the interest is real. It just does not require what HR fears.

What does the employee actually want to avoid?

It is not that the organisation should see nothing at all. Most people understand that an employer wants to know whether client data is ending up in a free chatbot. What they do not want is a record of themselves: which tools they use, how often and at what times, and the chance that this comes up again in an appraisal or a dispute.

That is a reasonable concern, and the GDPR takes it seriously: processing employees' data requires a purpose, necessity and transparency in advance, and in the Netherlands the Works Councils Act adds its own requirements. What an employer may and may not do is covered in our article on whether your employer can monitor your AI use. But note what the concern is about: the record of the person, not the count of the tool.

Where is the difference?

In one field. An observation without a user ID says: on this day, this domain was opened in the organisation. An observation with a user ID says: this person opened this domain. The first is a count, the second a behavioural record. They can come from the same source, yet they are two different things, with a different legal basis, a different retention period and a different conversation with the works council.

InterestWhat it asks forWhat it does not ask for
Organisation: a view of shadow AIWhich domains, how often, which status, how that changesWho opened the tool
Organisation: getting the decision acrossShowing the decision when someone opens the toolRecording who saw the notice
Employee: no recordNo user ID, no content, no breakdown per personThat the organisation sees nothing
Employee: knowing where they standThe decision per tool, and the alternativeA ban without explanation

The top two rows and the bottom two fit together. Not because someone struck a compromise, but because the organisation's question was never about a person.

Why does monitoring individuals also work against the organisation?

Suppose the insurer decides to measure per employee after all. What happens? The 2025 study by KPMG and the University of Melbourne of 48,000 workers in 47 countries found that 57 per cent of workers hide their AI use from their employer. That is the starting point, before anything has been announced.

Announce that use will be visible per person, and it moves to personal phones and personal accounts. The security manager's figures drop, the use does not and the visibility the whole project was meant to deliver is gone. Monitoring individuals costs the organisation precisely the insight it was introduced to provide. A count without people has no such effect, because there is nothing to evade.

What does this look like in practice?

The insurer sets up a measurement based only on domain and count, presents the design to the works council and switches it on. After six weeks, the picture is this: Copilot is allowed and is opened most often. ChatGPT and Perplexity also show up daily, along with three specialist tools nobody knew about: one that summarises policy terms, a translation tool and a transcription tool. Two of them have no decision yet, because they were not on any list.

No incident, but work to do. The summarising tool sees clients' policy documents, so it gets a decision first. The transcription tool follows. Nobody needs to know who used them to decide that, and the works council saw the list before the security manager did. It also shows what a one-off inventory misses: nobody could have asked about the three unknown tools, because nobody knew they existed.

What does BeeSensible record?

The extension notices when someone opens an AI tool and reports only the registrable domain, at most once a day per device, with no user ID, no path and no page content. Every tool starts as "No decision yet"; the organisation sets the status itself. When someone opens a tool that has a decision, that decision appears in the browser, with the approved alternative as the first button; the organisation decides whether people can still go on to the tool. What happened after such a notice is counted per tool, without a user ID.

AI register
AllowedUnder reviewNot allowedAll tools
Search by tool, vendor, domain or former name…
1,012 tools
DeepSeek
Critical · 90/100
Not allowed
Otter.aiNew
High · 68/100
No decision yet
Grok
High · 67/100
Not allowed
ChatGPT
High · 62/100
Allowed
Perplexity
Medium · 55/100
No decision yet
HeyGen
Medium · 53/100
No decision yet

Every tool, scored for risk

Over 1,000 AI tools, each scored from Low to Critical. Nothing is approved or blocked until someone decides.

More about AI Governance

So the decision reaches the employee and the count reaches the organisation. The dashboard has no breakdown by employee anywhere. AI governance without monitoring employees explains how the design works as a whole, including small groups and the role of the works council; the wider overview is on the topic page for AI governance. The register itself is on the AI tools page.

Where does an incident investigation fit?

There is one situation in which the organisation does want to know who: a specific incident, say a client file that ended up in a free tool. That is an investigation question. It should have its own procedure, with its own legal basis, its own proportionality test and the safeguards that go with it.

What does not work is designing the measurement of AI use so that it can also serve that investigation. From then on, every count carries the weight of a case file, and HR is right to worry after all. Keep the two apart: the measurement answers the governance question, the investigation follows its own procedure.

So do not reply to HR with "it is allowed" but with the design: which fields, no user ID and the list the works council gets to see first. Then both interests are served before the conversation even starts.

FAQ

Common questions

Can an organisation map shadow AI without tracking employees?

Yes. Shadow AI is a question about tools: which services are being opened that nobody has assessed. For that, the service's domain and a count are enough. Who opened it adds nothing. A measurement without a user ID answers the organisation's question and leaves the employee out of the picture.

What exactly is the employee's interest?

Not that the organisation sees nothing, but that no record is built up of what they do as an individual: which tools, how often, at what times. Such a record could resurface later in an appraisal or a dispute. A count at organisation level cannot, because there is nobody in it.

Why does monitoring individuals work against the organisation?

Because it changes the behaviour you wanted to measure. The 2025 study by KPMG and the University of Melbourne found that 57 per cent of workers hide their AI use from their employer. Announce that use will be visible per person and it moves to personal phones. The figures drop, the use does not and the organisation loses sight of it.

Does the works council have a say in this?

In the Netherlands, any system intended or suitable for monitoring the behaviour or performance of employees requires the works council's consent. A count per tool with no people in it is a different matter from a breakdown per employee, but always present the design in advance. A works council that understands what is and is not recorded is the best guardian of that line.

What if there is an incident?

Then you have an investigation question, which needs its own procedure with its own legal basis and its own safeguards. You do not answer that question with the measurement of AI use, and the measurement should not be built to serve it. Mix the two and every count becomes a potential case file.

Portrait of Rens Timmermans from BeeSensible

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