Dykema Gossett PLLC

Dykema Labor & Employment Law Blog

The Social Security Number Privacy Act Is Still A Trap For Unwary Employers

Contributors

The Social Security Number Privacy Act Is Still A Trap For Unwary Employers

In an effort to combat the growing problem of identity theft, the Michigan legislature enacted the Social Security Privacy Act (SSNPA) in 2005. Though most Michigan employers took steps to comply with SSNPA when it was enacted, since then there has been very little discussion of the Act’s requirements. Employers should, however, review their policies and training to ensure that they continue to comply the law.  

Briefly, the SSNPA prohibits public displays of more than 4 sequential digits of the social security number (SSN) and the use of 4 or more sequential digits of the SSN in a variety of employment related documents and actions. For example, an employee’s primary account number may not contain more than 4 sequential digits of the SSN nor may an employer require an employee to transmit more than 4 sequential digits of his or her SSN over the internet or a computer system or network unless the connection is secure or the transmission is encrypted. 

The SSNPA not only prohibits the transmission or display of social security numbers at work, it also requires employers, with a few exceptions, to have in place a privacy policy that does at least the following regarding the SSNs in its possession:

  • Ensures to the extent practicable the confidentiality of the SSNs;
  • Prohibits unlawful disclosure of the SSNs;
  • Limits who has access to information or documents that contain the SSNs;
  • Describes how to properly dispose of documents that contain the SSNs; and
  • Establishes penalties for violation of the privacy policy. 

It is not enough for the policy simply to exist, however. The SSNPA requires employers to publish their privacy policy in an employee handbook, procedures manual, or similar document that is available electronically.  So, if you are reviewing or revising your employee handbook (and you should conduct those reviews periodically), be sure to check for a valid SSNPA policy.