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July 6, 2007

Governor vetoes Council-opposed legislation

After The Business Council raised strong objections to the idea, Governor Spitzer vetoed a bill, S. 4565, that would have prohibited employers from using employee Social Security numbers for identity purposes.

“While we believe that the sponsors' intent was to address a specific privacy concern, this bill imposes broad, unworkable restrictions on the state's business community,” Business Council President and CEO Kenneth Adams wrote in a June 28 letter to the Governor.

The unspecific language of the legislation would result in numerous problems for employers, Adams wrote.

The Governor cited the Council's arguments when vetoing the bill.

“The language of the bill is extraordinarily broad and subject to numerous possible interpretations,” Governor Spitzer wrote in his veto message. “As a result, it could subject businesses and government agencies to extensive liability for appropriate conduct carried out in the ordinary course of business.”

“Employers are obligated by law to use Social Security numbers to 'identify' employees for federal and state income and tax reporting purposes," Adams wrote. “Further, Social Security numbers are commonly used by employers for employee identification with regard to payroll, retirement plans (including 401(k) plans) and insurance programs.”

Legislation designed to protect employees from identity theft should not prohibit usage of Social Security numbers where it is otherwise require by law, Adams wrote.

“We could support legislation that specifically prohibits uses -- such as the printing of Social Security numbers on employee identification cards -- that place Social Security numbers at clear risk of disclosure and misuse," Adams wrote. The Council would also support legislation that precludes dissemination of Social Security numbers by employers unless required by statute or a court order.

Governor Spitzer agreed that employer protection of sensitive employee information was important.

"But in protecting employee privacy, we must be careful as well not to cast so broad a net as to prohibit conduct that is both legitimate and necessary," the Governor said.