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The Consumer Financial Protection Bureau (CFPB) has warned employers about the increasing use of monitoring technologies that track employees without their consent, raising serious privacy concerns.
The federal agency has released a statement cautioning companies against adopting surveillance tools, such as algorithmic scoring and third-party background checks, that evaluate workers without transparency or explicit consent. The CFPB expressed concerns that such methods could be misused to anticipate employee resignations, gauge union-organizing efforts, and influence hiring or promotion decisions.
"Workers shouldn’t be subject to unchecked surveillance or have their careers determined by opaque third-party reports without basic protections," said CFPB Director Rohit Chopra.
Chopra likened the use of scoring and profiling systems to the long-standing practices in credit markets, where such methods have previously raised concerns about transparency and fairness. According to the CFPB, companies employing these techniques must prioritize transparency and respect workers' privacy rights.
Use of tracking apps to monitor workers
The agency highlighted a trend within some organizations requiring employees to install tracking apps on their personal devices. The apps can monitor workers' movements, access work applications, and track productivity. Such practices, the agency warned, often cross privacy lines and may infringe upon employee rights. It emphasized that tracking apps and tools should not be implemented without workers' knowledge or approval.
Under the Fair Credit Reporting Act (FCRA), employers must secure employee consent before obtaining consumer reports or using them to make employment-related decisions. Furthermore, employees should have the right to access and dispute any incorrect information in these reports. The CFPB said that companies are required to rectify or delete unverifiable information, preventing employees from facing adverse consequences due to inaccuracies.
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The issue has gained national attention, with large companies like Amazon already facing scrutiny over its surveillance practices. The firm’s installation of surveillance cameras in delivery vans in 2021 was framed as a safety measure by the company but drew strong criticism from privacy advocates and lawmakers. Critics argued that the move overstepped acceptable limits of workplace monitoring, blurring the line between legitimate safety initiatives and intrusive surveillance.
Apple falls foul of NLRB
In addition, the National Labor Relations Board (NLRB) recently filed a complaint against tech giant Apple, alleging that it fired an employee who had advocated for workplace improvements using the internal messaging platform Slack. While Apple has yet to comment on the complaint, the NLRB case highlights growing tensions between worker advocacy and employer monitoring practices at a time when remote work and digital communication are the norm.
For many companies, balancing safety and productivity with privacy compliance has become a challenge, as fast developing technology offers new ways to monitor workforce behavior and legislation struggles to keep pace. HR experts warn that while technology can aid in ensuring productivity and safety, an overreliance on tracking systems or invasive monitoring methods could lead to potential legal issues and impact on employee morale.
The CFPB’s guidance serves as a timely reminder that as technology advances, companies must remain vigilant in protecting employee rights and maintaining compliance with regulatory standards.
