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<ns0:Id>20250AB__107398AMD</ns0:Id>
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<ns0:ActionText>INTRODUCED</ns0:ActionText>
<ns0:ActionDate>2025-02-20</ns0:ActionDate>
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<ns0:ActionText>AMENDED_ASSEMBLY</ns0:ActionText>
<ns0:ActionDate>2026-01-05</ns0:ActionDate>
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<ns0:SessionYear>2025</ns0:SessionYear>
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<ns0:MeasureNum>1073</ns0:MeasureNum>
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<ns0:AuthorText authorType="LEAD_AUTHOR">Introduced by Assembly Member Ávila Farías</ns0:AuthorText>
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<ns0:House>ASSEMBLY</ns0:House>
<ns0:Name>Ávila Farías</ns0:Name>
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<ns0:Title>An act to add Section 1094.1 to the Unemployment Insurance Code, relating to privacy.</ns0:Title>
<ns0:RelatingClause>privacy</ns0:RelatingClause>
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<ns0:Subject>Employment Development Department: disclosure of wage information: qualified third-party vendors.</ns0:Subject>
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<html:p>Under existing law, the information obtained in the administration of the Unemployment Insurance Code is for the exclusive use and information of the Director of Employment Development in the discharge of the director’s duties and is not open to the public. Existing law permits the use of the information for specified purposes, including enabling the California Workforce Development Board and other entities to access any relevant quarterly wage data necessary for the evaluation and reporting of specified workforce program performance outcomes. Existing law makes it a crime for any person to knowingly access, use, or disclose this confidential information without authorization.</html:p>
<html:p>This bill would require the Employment Development Department to release an employee’s
wage information to a qualified third-party vendor if the employee has provided the department written permission for that release. The bill would require the department to allow, at the request of the employee, the electronic transmission of the employee’s wage information directly to or through a qualified third-party vendor for permissible uses, as defined. The bill would require the department to enter into an agreement with a qualified third-party vendor to allow for electronic transmission of an employee’s wage information for permissible uses. The bill would require a qualified third-party vendor to use the employee’s wage information for a permissible use and to share the employee’s wage information with a subscriber, subject to specified restrictions the bill would impose on the subscriber. The bill would provide that wage information is confidential, as specified.</html:p>
<html:p>This bill would prohibit the department from expending any state funds to execute the terms of the agreement with a qualified third-party vendor. The bill would require the department to charge and collect fees from a qualified third-party vendor to cover startup costs and the expenses incurred in the administration of these provisions, as specified. The bill would make any person who knowingly accesses, uses, or discloses any information made confidential by the bill’s provisions without authorization, as provided, guilty of a misdemeanor. By creating a new crime, the bill would impose a state-mandated local program. The bill would define various terms for purposes of these provisions.</html:p>
<html:p>The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.</html:p>
<html:p>This bill would provide that no reimbursement is required by this act for a specified reason.</html:p>
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<ns0:Preamble>The people of the State of California do enact as follows:</ns0:Preamble>
<ns0:BillSection id="id_2A2C1EFE-E71E-4E37-8D2A-DA3937675FCE">
<ns0:Num>SECTION 1.</ns0:Num>
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Section 1094.1 is added to the
<ns0:DocName>Unemployment Insurance Code</ns0:DocName>
, to read:
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<ns0:Num>1094.1.</ns0:Num>
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(a)
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For purposes of this section, the following definitions apply:
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<html:p>
(1)
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“Permissible use” means verifying an employee’s wages or employer or using the employee’s wage information for credit granting and related account maintenance, residential leasing, employment screening, or insurance or government transactions, consistent with the purposes set forth in the federal Fair Credit Reporting Act (15 U.S.C. Sec. 1681 et seq.).
</html:p>
<html:p>
(2)
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“Qualified third-party vendor” means a consumer reporting agency engaged in the business of furnishing consumer reports and who meets all of the following criteria:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
Has executed contracts
in place for the same or substantially similar service with at least three other states.
</html:p>
<html:p>
(B)
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Has completed systems integration for the same or substantially similar service in one or more states.
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<html:p>
(C)
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Has had its business model and data sharing agreements and other collateral materials reviewed for conformance, either formally or informally, by the United States Department of Labor and found to be in conformity with relevant federal rules and regulations.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
“Subscriber” means a person or entity that pays a fee to a qualified third-party vendor to obtain consumer reports or other information from the qualified third-party vendor.
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<html:p>
(4)
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“Wage information” means the employee’s full name, social security number, the employer’s name, and the total amount of
wages paid to that employee each quarter, as reported to the department by the employer in its quarterly contribution return and report of wages.
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<html:p>
(b)
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The department shall release an employee’s wage information to a qualified third-party vendor if the employee has provided the department written permission for that release.
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<html:p>
(c)
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The department shall provide the employee’s wage information to the employee or their representative without charge.
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<html:p>
(d)
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The department shall allow, at the request of the employee, the electronic transmission of the employee’s wage information, directly to or through a qualified third-party vendor, for permissible uses.
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<html:p>
(e)
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The department shall enter into an agreement with a qualified third-party vendor to allow for electronic
transmission of an employee’s wage information for permissible uses.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
The qualified third-party vendor shall use the employee’s wage information received from the department pursuant to this section for a permissible use and may share the employee’s wage information with a subscriber subject to subdivision (g).
</html:p>
<html:p>
(g)
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(1)
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A subscriber shall not request or receive wage information from a qualified third-party vendor pursuant to subdivision (f) unless the request is for a permissible use, and shall not use that wage information unless the use is a permissible use.
</html:p>
<html:p>
(2)
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A subscriber shall only receive wage information about an employee from a qualified third-party vendor pursuant to subdivision (f) if the employee has provided written permission that authorizes the release of that employee’s wage
information to a subscriber.
</html:p>
<html:p>
(3)
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A subscriber shall not resell or redisclose wage information received from a qualified third-party vendor.
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<html:p>
(h)
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All wage information reported to the department and provided to a qualified third-party vendor pursuant to this section shall be confidential and shall remain subject to the confidentiality provisions contained in applicable federal and state laws.
</html:p>
<html:p>
(i)
<html:span class="EnSpace"/>
The qualified third-party vendor shall require a person who receives wage information to keep that information confidential and to use the information only for the designated permissible use.
</html:p>
<html:p>
(j)
<html:span class="EnSpace"/>
The department shall not expend any state funds to execute the terms of the agreement with the qualified third-party vendor.
</html:p>
<html:p>
(k)
<html:span class="EnSpace"/>
The department, consistent with Part 603 of Title 20 of the Code of Federal Regulations, shall charge and collect fees from a qualified third-party vendor to cover startup costs and the expenses incurred in preparation for releasing an employee’s wage information to a qualified third party for permissible uses in the administration of this section, not to exceed the reasonable costs of that administration.
</html:p>
<html:p>
(l)
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Any person who knowingly accesses, uses, or discloses any information made confidential pursuant to this section without authorization pursuant to this section is in violation of this section and is guilty of a misdemeanor.
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<ns0:Num>SEC. 2.</ns0:Num>
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<html:p>
No reimbursement is required by this act pursuant to Section 6 of Article XIII
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B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII
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B of the California Constitution.
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