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Legislative Memo

Ken Pokalsky
Vice President of Government Affairs
T 518.465.7511
www.bcnys.org

BILL:

S.1444 (Nozzolio) /A.3750 (Ortiz)

Support

SUBJECT:

Prohibition on Use of SSNs

 

DATE:

April 7, 2008

 

The Business Council opposes this legislation which, through amendments to the General Business Law, imposes a broad prohibition on the use of social security numbers for “the identification of individuals.”   We note that similarly broad restrictions on the use of SSNs was vetoed in 2007.

While its intent may be to help fight against identity theft, this bill would impose unworkable restrictions on the state's business community.

For example, employers are obligated by law to use social security numbers to “identify” employees for federal and state income and tax reporting purposes.  Further, social security numbers are commonly used by employers for internal employee identification with regard to payroll, retirement plans (including 401(k) plans) and insurance programs.

Obviously, the legislature should not prohibit usage where it is otherwise required by law – we note that similar legislation passed last session, applicable to public sector employees, which recognizes these mandatory uses.

Further, we believe that the real public policy issue here is not the use of social security numbers, but their potential disclosure.  We could support legislation that specifically prohibits uses — such as the printing of SSNs on employee identification cards — that place social security numbers at clear risk of disclosure and misuse.  Likewise, we could support legislation that precludes dissemination of social security numbers by employers unless required by statute or court order.

However, we do not support a general prohibition of use for all categories of “identification.”   So long as a business has appropriate data security measures in place, we see no compelling need for such a prohibition.  Further, imposing a ban on such usage would impose enormous costs on employers, who would not only be required to modify current business practices, but could be required to redact all past usages of SSNs from electronic and paper files.

Because of the issues discussed above, we oppose approval of S.1444/A.3750.