Legislative Memo

T 518.465.7511


S.8206 (Robach) / A.10848 (John) @ Request of Department of Labor



Using and sharing of confidential employer and claimant data from the unemployment insurance wage files



June 4, 2008


The Business Council of New York State opposes this bill, which was introduced at the request of the Department of Labor. The bill goes beyond 2006 federal regulations to expand access to the use of confidential employer and individual wage data to a number of state agencies.

The use of confidential employer and individual wage records by various state agencies may serve laudatory governmental functions but the ad hoc continued expansion on state agency access to the data calls into question whether or not there is an overarching state policy governing access and use.  The assertion that there will be confidentiality agreements between the agencies does little to satisfy concerns that the potential for misuse of this data or for security breaches expands exponentially the more access to the data is given.

The confidential data to which access is being sought is provided by businesses as part of their combined quarterly tax filings with the New York State Department of Taxation & Finance. This legislation would authorize the New York State Department of Labor to re-disclose this data,  after entering into appropriate data sharing agreements with OTDA, VESID and CBVH, expanding on the already statutorily authorized re-disclosure of the data with the Workers' Compensation Board, the State Insurance Department and the State Insurance Fund, and state and local economic development agencies. Separately, Section 697 of the Tax Law lists a multitude of permitted accesses to confidential wage and employer data aggregated by the Tax Department to a variety of other state agencies.

Business and individual wage and employment data disclosure should be limited to those which derive a direct benefit from the governmental programs seeking access to this data: economic development incentives, supported work clients, wage credits. In the course accepting of this benefit, an affirmative authorization to disclose follow-up wage and employment records should be secured.

There is ample research that access to confidential data in the private and public sector is often not sufficiently tightly controlled. Some research also shows that the data is often viewed for purposes not authorized and by individuals not authorized with access. This does not mean that there may not be valid public policy purposes for which aggregate wage and employer data analysis could better inform public policy. The Business Council would argue that the State would be better served, and confidential data more likely secured, through the designation of a single state entity which houses and prepares the data analysis for authorized use by various governmental agencies. Providing access through these multi-layered means (state agency to state agency, state agency to local government, state agency to courts) leaves the data vulnerable on many different levels and there is no degree of confidence that the confidential data will be protected, the more access to it proliferates.

It should also be noted that access to confidential wage and employer information has moved from the public policy objective of compliance, enforcement, and reporting into eligibility for services arena. This would be the time to evaluate the broader public purposes and, rather than create within each government agency staff to perform the data analysis, eligibility, etc. based on this wage and employer data, consolidate functions within a designated state agency to perform this function on behalf of all state agencies.

The Business Council opposes this bill because the bill's solution of providing expanded access to confidential data does not provide a well reasoned solution to inform the underlying public policy issues being advanced.