[Congressional Record Volume 143, Number 131 (Friday, September 26, 1997)]
[Senate]
[Pages S10055-S10057]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BURNS:
  S. 1223. A bill to protect personal employment information reported 
to the National Directory of New Hires; to the Committee on Finance.

[[Page S10056]]

            the employee information protection act of 1997

  Mr. BURNS. Mr. President, I rise to introduce the Employee 
Information Protection Act of 1997. This bill will correct a serious 
problem with the 1996 welfare reform law that threatens the privacy of 
every American.
  I do not know how many of my colleagues are aware of the fact that 
the new welfare reform law created a national new hire directory, which 
requires States to collect the name, address, and Social Security 
number of all newly hired employees and send this information to 
Washington, DC. This new hire directory will be housed at the Social 
Security Administration, under agreement with the Office of Child 
Support Enforcement, and the data will be checked against a registry of 
child support cases to detect overdue payments.
  Concerns with this new hire directory nearly killed the welfare 
reform bill in the Montana Legislature and in several other State 
legislatures, but folks inside the Beltway do not seem too concerned. 
But I am concerned, and I will tell you why.
  I am all for tracking down deadbeat parents and recovering overdue 
child support. But this new directory covers every new hire in every 
State and does not distinguish between deadbeats and nondeadbeats. 
What's more, the new law puts no limits on how long employee data may 
remain in the national new hire directory, and the Office of Child 
Support Enforcement has not developed any limits. It is especially 
alarming to me that in addition to the Office of Child Support 
Enforcement and the Social Security Administration, the Treasury 
Department has access to the directory and the Secretary of Health and 
Human Services has the discretion to provide researchers access to the 
directory. With the revelations this week at the Finance Committee 
hearings of abuse of taxpayer information at the IRS, it is urgent that 
we take measures to protect personal information from abuse.
  The Employee Information Protection Act is simple--in fact it is only 
one sentence long, not counting the findings. That sentence reads: 
``Information entered into such database shall be deleted 6 months 
after the date of entry.'' That is it. This 6-month limit on retention 
of new hire data would give the Child Support Office sufficient time to 
check employee data against the child support case registry and start 
collection efforts on the deadbeats. At the same time, it will provide 
some protection for the personal information of the vast majority of 
Americans who do not owe child support.
  I urge my colleagues to take a good look at this situation and if you 
have concerns as I do, join me in sponsoring the Employee Information 
Protection Act of 1997. I ask unanimous consent that Monday's New York 
Times article on the new hire directory be inserted into the Record.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                S. 1223

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Employee Information 
     Protection Act of 1997''.

     SEC. 2. FINDINGS AND PURPOSE.

       (a) Findings.--Congress finds the following:
       (1) The Personal Responsibility and Work Opportunity 
     Reconciliation Act of 1996 (Public Law 104-193; 110 Stat. 
     2105) requires Federal and State child support enforcement 
     agencies to implement new programs to collect overdue child 
     support payment, thereby reducing the burden on taxpayers by 
     lowering welfare payments.
       (2) Among the new programs created under such Act and the 
     amendments made by such Act, is the National Directory of New 
     Hires, to be administered by the Social Security 
     Administration, under agreement with the Office of Child 
     Support Enforcement of the Department of Health and Human 
     Services. Under this program, States are required to develop 
     a reporting system whereby employers must report to their 
     respective States the name, address, and social security 
     number of all newly hired employees. States must forward the 
     new hire data within 3 days of receipt to the National 
     Directory of New Hires, where the data will be checked 
     against the Federal Case Registry of Child Support Orders to 
     detect overdue child support.
       (3) The Personal Responsibility and Work Opportunity 
     Reconciliation Act of 1996 does not limit how long employee 
     data may remain in the National Directory of New Hires, and 
     the Office of Child Support Enforcement of the Department of 
     Health and Human Services has not developed any such limits 
     as of September 15, 1997. In addition to the Office of Child 
     Support Enforcement of the Department of Health and Human 
     Services and the Social Security Administration, the 
     Department of the Treasury has access to the directory and 
     the Secretary of Health and Human Services has the discretion 
     to provide researchers access to the directory.
       (4) The overwhelming majority of newly hired individuals do 
     not have child support orders entered against them, yet their 
     personal data can be viewed by Federal agencies without such 
     individuals' knowledge or consent.
       (5) Recent disclosures of unauthorized viewing of taxpayer 
     information by officials of the Internal Revenue Service 
     highlight the potential for abuse of such information and the 
     need for safeguarding measures.
       (6) Several States with new hire reporting programs have 
     time limits on data retention ranging from 6 to 9 months.
       (7) A 6-month limit on retention of new hire data in the 
     National Directory of New Hires, from the date such data is 
     entered, would allow sufficient time to check the data 
     against the Federal Case Registry of Child Support Orders and 
     to initiate action against individuals with overdue child 
     support, and would reduce the potential for abuse and misuse 
     of the data.
       (b) Purpose.--The purpose of this Act is to safeguard 
     personal information concerning employees who do not have 
     child support orders pending against them by placing a 
     reasonable time limit on the retention of new hire data 
     reported to the National Directory of New Hires.

     SEC. 3. LIMIT ON NEW HIRE DATA RETENTION.

       (a) Requirement To Delete Data After 6 Months.--Section 
     453(i)(2) of the Social Security Act (42 U.S.C. 653(i)(2)) is 
     amended by adding at the end the following: ``Information 
     entered into such database shall be deleted 6 months after 
     the date of entry.''.
       [(b) Effective Date.--The amendment made by subsection (a) 
     shall take effect as if included in the enactment of title 
     III of the Personal Responsibility and Work Opportunity 
     Reconciliation Act of 1996 (Public Law 104-193; 110 Stat. 
     2198).]
                                  ____


               [From the New York Times, Sept. 22, 1997]

           U.S. Inaugurating a Vast Database of All New Hires

                            (By Robert Pear)

       Washington, Sept. 20.--Enforcement of child support 
     obligations enters a new era on Oct. 1, when the Federal 
     Government will start operating a computerized directory 
     showing every person newly hired by every employer in the 
     country so Federal and state investigators can track down 
     parents who owe money to their children.
       States will be able to use the directory to locate parents 
     and dun them, typically by securing court orders to employers 
     to deduct child support from wages and salaries.
       Keeping track of parents who move from state to state is 
     one of the most difficult tasks in collecting child support, 
     officials say. More than 30 percent of the 19 million child 
     support cases involve parents who do not live in the same 
     state as their children.
       President Clinton will soon announce the National Directory 
     of New Hires, which is required by the 1996 welfare law. But 
     the director is not just for welfare recipients. It will 
     record basic information, including names, addresses, Social 
     Security numbers and wages, for everyone hired after Oct. 1 
     for a full- or part-time job by an employer of any size.
       It will be one of the largest, most up-to-date files of 
     personal information kept by the Government. Michael Kharfen, 
     a spokesman for the Department of Health and Human Services, 
     said the Government expected to receive data on 60 million 
     newly hired employees a year. Wages must be reported every 
     three months; the Government expects to receive 160 million 
     wage reports each quarter.
       The size and scope of the database have raised concerns 
     about the potential for intrusions on privacy.
       Federal and state officials predict that the new Federal 
     directory, combined with similar directories in all states, 
     will produce billions of dollars in new child support 
     payments. States like New York, Virginia, Texas and Missouri, 
     which have required the reporting of newly hired workers in 
     the last few years, say the procedure has been extremely 
     helpful in locating absent parents.
       In New York, Daniel D. Hogan, a spokesman for the state's 
     Department of Family Assistance, said that three million 
     people had been hired in the last year and that more than 5 
     percent of them had been found, through matching of computer 
     files, to owe child support.
       When people change jobs, Mr. Hogan said, New York officials 
     inform the new employers of any child support obligations so 
     the money can immediately be withheld from wages.
       ``We don't give them an opportunity to become deadbeats,'' 
     Mr. Hogan said. ``The biggest problem facing us in child 
     support enforcement is people who move out of state. The best 
     part of the Federal reform is that it will allow us to break 
     down barriers state to state.''
       Health and Human Services will maintain a separate register 
     listing everyone who

[[Page S10057]]

     owes or is owed child support. It will check each new 
     employee against the list of child support orders to see if 
     the worker owes any money.
       Thomas D. Neal, a child support specialist in the Texas 
     Attorney General's office, said: ``The national directory 
     will tremendously enhance our ability to locate absent 
     parents and collect child support. Before now, we did not 
     have a good mechanism to know that another state was looking 
     for an individual who might be working in Texas.''
       Virginia has required the reporting of all newly hired 
     employees since 1993. Patricia Addison, manager of operations 
     for the state's child support program, said, ``We've found it 
     an invaluable tool.''
       The State of Virginia is routinely informed whenever a 
     person takes a new job. By contrast, Ms. Addison said, in the 
     past, ``the only way we found out that the father had changed 
     jobs is that the child support payments stopped.''
       Despite the enthusiasm of state officials, Robert M. 
     Gellman, an expert on privacy and information policy, 
     expressed concern that the new data would be misused.
       ``The Government is creating a gigantic new database with 
     very broad uses and very little attention paid to the 
     protection of personal privacy,'' he said. ``Private 
     detectives will find a friend in the police department or a 
     child welfare office to give them access to information in 
     the directory of new hires. That already happens with 
     criminal, medical and credit records.''
       Mr. Gellman predicted that Congress would increase the 
     number of people authorized to use the new directory, just as 
     it has expanded the list of officials with access to Federal 
     tax return information over the years.
       Under Federal law, state welfare and child support 
     officials will have access to the new national directory. The 
     Internal Revenue Service, the Social Security Administration 
     and the Justice Department will also have access for some 
     purposes.
       A parent living with a child will be able to use the 
     directory to get information about an absent parent who owes 
     child support. For example, a mother with custody of a child 
     will be able to ascertain the father's home address, the name 
     and address of his employer and the amount of the father's 
     income, assets and debts. Using such information, the mother 
     may ask a local court to modify the child's support order if 
     the father's earnings have increased.
       In Missouri, child support collections rose 17 percent, to 
     $279 million, in 1996 after the state required reporting of 
     newly hired workers. Teresa L. Kaiser, director of the 
     Missouri program, said, ``We had a big increase in 
     collections from `job jumpers,' parents who want work in one 
     place for a few months, then move to another job before we 
     could get a wage-withholding order.''
       States say the reporting of new employees not only 
     increases child support collections, but also saves money in 
     other programs. State officials can often reduce or eliminate 
     payments for welfare, food stamps, unemployment insurance and 
     Medicaid after learning that the recipients of such aid have 
     been hired.
       Under Federal law, the hiring of a new employee must be 
     reported within 20 days to state authorities, who then have 8 
     days to send the data to Washington. States may establish 
     tighter deadlines for employers, and many have done so.
       Collections through the Federal child support program 
     increased last year by 50 percent, to $12 billion, from $8 
     billion in 1992. But nationwide, only half of the families 
     with child support orders receive the full amount due, and 
     millions get nothing.
       Here is how the new program will work:
       Employers may file information by mail or magnetic tape. 
     States may also take the information over the telephone, by 
     fax or through the Internet.
       An employer who fails to report new employees may be fined 
     $25 for each newly hired worker. An employer who conspires 
     with an employee to flout the reporting requirements may be 
     fined $500.
       A multistate employer may file a report with one state 
     listing all of its hiring across the country. Or, it may file 
     a separate report for each new employee in the state where 
     the person works.
       The Federal Government will require only six items of 
     information: the name, address and Social Security number of 
     each newly hired employee, the employer's name and address 
     and the identification number assigned to the employer by the 
     Government.
       But many states are requiring employers to file additional 
     information, like telephone numbers, dates of birth, driver's 
     license number and details of health insurance coverage 
     provided to new employers.
                                 ______