Employers have the right to obtain social security numbers from job applicants and employees. Even with the advent of identity theft statutes in many states, social security numbers may still be obtained for legitimate administrative and employment purposes.

Recently, the Third Circuit Court of Appeals (which covers New Jersey, Pennsylvania and Delaware) held that an employer’s rejection of a new hire who refused to provide his social security number did not constitute national origin discrimination.

In the Third Circuit case, Computer Aid, Inc. ("Computer Aid") hired John McCauley as a Help Desk Analyst. McCauley asked Computer Aid’s recruiting manager, "Mrs. Reynolds," if he must provide his social security number on the employment forms. Mrs. Reynolds told McCauley that she would contact him at a later time to respond to his question. In the meantime, McCauley began training at a client’s location.

In a subsequent meeting, Mrs. Reynolds reminded McCauley that he needed to complete his employment forms. McCauley again asked whether he needed to provide his social security number, and Mrs. Reynolds told him that she would contact him at a later time. Shortly thereafter, Computer Aid terminated McCauley for failing to meet its hiring criteria.

McCauley sued Computer Aid, alleging that its decision to terminate his employment constituted national origin (American) discrimination in violation of Title VII of the Civil Rights Act of 1964 and other federal and state laws. He also alleged that Computer Aid violated his constitutional right to privacy. The district court dismissed his claims, and the Third Circuit upheld this decision.

The Third Circuit noted that federal law requires employers to collect employees’ social security numbers in connection with tax and immigration laws. Accordingly, the fact that Computer Aid terminated McCauley for refusing to provide his social security number was not discriminatory. The Third Circuit also held that requiring disclosure of a social security number does not violate an individual’s right to privacy so as to require constitutional protection.

This decision is welcome for employers because it demonstrates that it is not discriminatory per se for an employer to obtain social security numbers from its employees for legitimate business reasons. Employers, however, should ensure that they collect this information from all employees to avoid discrimination allegations. Furthermore, while it is not discriminatory to collect and maintain social security numbers, various state identity theft laws (including those in New York, New Jersey, and Connecticut) require that social security numbers be maintained confidentially. So, be sure that the social security numbers that are obtained are properly maintained and be aware of the consequences of any loss or theft of that information. Day Pitney can assist you with any questions you may have with regard to employee privacy issues.

McCauley v. Computer Aid, Inc., No. 06-4089 (3rd Cir. June 27, 2007)