CFPB looks to existing law to regulate workplace surveillance tech

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After a high volume of complaints, the Consumer Financial Protection Bureau offered a response as to how the government can limit the use of sensitive employee information in hiring practices.

The Consumer Financial Protection Bureau says existing federal law can help manage how the data broker industry utilizes data sourced from workplace surveillance technologies. 

The agency made its comments in response to a White House request for information on the impact of automated monitoring tools that are increasingly being used by U.S. employers. The CFPB's response to the White House outlines how the government can extend consumer protections to safeguard sensitive data, particularly within hiring and termination practices.

“As markets and technology evolve, agencies that administer and enforce consumer protection statutes must ensure that the law is applied effectively to those changes,” CFPB’s General Counsel and Senior Advisor Seth Frotman and Chief Technologist and Senior Adviser Erie Meyer wrote in response to the White House inquiry. “It is therefore imperative that the federal government and states take steps under applicable law to address concerns raised by significant changes in the labor market brought on by automated worker surveillance and management.”

The CFPB was already in the midst of its own probe into the data broker economy out of concern that the market is largely unregulated, and covers personal data that is vulnerable to exploitation.

The agency is looking to apply the Fair Credit Reporting Act, the federal law that safeguards consumer credit information and regulates reporting practices, to data brokers. Frotman and Meyer stated that expanding these provisions to protect more employment purposes can help limit the scenarios where personal data can be used as part of an employment evaluation process. 

Specifically, the CFPB highlighted the FCRA’s protections for future employment opportunities, and restricts using select personal financial information in a hiring or promotion decision. CFPB noted that these protections can help prevent workplace surveillance tech from augmenting employers’ hiring and retention decisions. 

“Automated workplace surveillance technology greatly increases the amount of information being fed into these decision-making systems, the frequency with which they may be used on a given worker and the number of workers subject to them,” the agency’s press release on the response reads. “As companies offer employers new technologies to gather, share and sell information in a variety of different ways, federal consumer financial laws may offer important protections to workers.”

The press release noted that CFPB has “long received” complaints from U.S. workers on information inaccuracies and hiring transparency beyond retention processes. The letter to the White House cited the example of an employee who had worked for companies like Uber and Lyft and was fired following a potentially inaccurate ineligibility report, but that person was never allowed to see the background report from the third-party service. 

“As companies offer employers new technologies, including workplace surveillance tools, to gather, share and sell this information in different ways, ensuring the protections afforded by the FCRA where applicable is critical,” the letter states.