The US Consumer Financial Protection Bureau (CFPB) has issued a warning to businesses about the potential legal implications of using advanced technology, such as artificial intelligence (AI) and algorithmic scoring, for employee surveillance.
In its new guidance, the CFPB emphasized that existing consumer protections, particularly those under the Fair Credit Reporting Act (FCRA), also apply to these monitoring technologies, granting employees rights in how their data is collected and used.
CFPB Director Rohit Chopra expressed concerns about the fairness of these monitoring systems, which can gather data on workplace conduct, productivity, or union activity.
“Workers shouldn’t be subject to unchecked surveillance or have their careers determined by opaque third-party reports without basic protections,” Chopra stated.
The new CFPB guidelines clarify that employees must consent to the collection of personal information, be informed about how their data is used, and have the right to challenge inaccurate information. Companies are required to follow FCRA guidelines, including obtaining employees’ consent before conducting background checks or using third-party reports to make employment-related decisions. Businesses must also delete unverifiable data to avoid unfairly penalizing employees.
In response to rising concerns, the CFPB advises employers to review their surveillance practices to ensure they comply with federal laws designed to protect employees from undue penalties or discrimination based on third-party data.
This comes amid a broader debate on workplace surveillance, as companies increasingly adopt technology to monitor safety, productivity, and other behaviors. For instance, Amazon previously faced criticism from privacy advocates and lawmakers over plans to install cameras in delivery vans for safety monitoring. Recently, the National Labor Relations Board filed a complaint against Apple, alleging the company fired an employee for advocating workplace changes on Slack, highlighting the complexities of workplace monitoring and employee rights.
The CFPB’s guidance reinforces that as new monitoring tools become commonplace, protections for workers must adapt to prevent misuse of personal data in employment decisions.
The Wall Street Journal and CBS News contributed to this report.
