PART 603—FEDERAL-STATE UNEMPLOYMENT COMPENSATION (UC) PROGRAM; CONFIDENTIALITY AND DISCLOSURE OF STATE UC INFORMATION Authority: Secs. 116, 189, 503, Pub. L. 113-128, 128 Stat. 1425 (Jul. 22, 2014); 20 U.S.C 1232g. Source: 71 FR 56842, Sept. 27, 2006, unless otherwise noted. Subpart A—In General § 603.1 What are the purpose and scope of this part? The purpose of this part is to implement the requirements of Federal UC law concerning confidentiality and disclosure of UC information. This part applies to States and State UC agencies, as defined in § 603.2(f) and (g). § 603.2 What definitions apply to this part? For the purposes of this part: (a)(1) Claim information (i) Whether an individual is receiving, has received, or has applied for UC; (ii) The amount of compensation the individual is receiving or is entitled to receive; and (iii) The individual's current (or most recent) home address. (2) For purposes of subpart C (IEVS), claim information also includes: (i) Whether the individual has refused an offer of work and, if so, a description of the job offered including the terms, conditions, and rate of pay; and (ii) Any other information contained in the records of the State UC agency that is needed by the requesting agency to verify eligibility for, and the amount of, benefits. (b) Confidential UC information confidential information (c) Public domain information (1) Information about the organization of the State and the State UC agency and appellate authorities, including the names and positions of officials and employees thereof; (2) Information about the State UC law (and applicable Federal law) provisions, rules, regulations, and interpretations thereof, including statements of general policy and interpretations of general applicability; and (3) Any agreement of whatever kind or nature, including interstate arrangements and reciprocal agreements and any agreement with the Department of Labor or the Secretary, relating to the administration of the State UC law. (d) Public official (1) An official, agency, or public entity within the executive branch of Federal, State, or local government who (or which) has responsibility for administering or enforcing a law, or an elected official in the Federal, State, or local government. (2) Public postsecondary educational institutions established and governed under the laws of the State. These include the following: (i) Institutions that are part of the State's executive branch. This means the head of the institution must derive his or her authority from the Governor, either directly or through a State WDB, commission, or similar entity established in the executive branch under the laws of the State. (ii) Institutions which are independent of the executive branch. This means the head of the institution derives his or her authority from the State's chief executive officer for the State education authority or agency when such officer is elected or appointed independently of the Governor. (iii) Publicly governed, publicly funded community and technical colleges. (3) Performance accountability and customer information agencies designated by the Governor of a State to be responsible for coordinating the assessment of State and local education or workforce training program performance and/or evaluating education or workforce training provider performance. (4) The chief elected official of a local area as defined in WIOA sec. 3(9). (5) A State educational authority, agency, or institution as those terms are used in the Family Educational Rights and Privacy Act, to the extent they are public entities. (e) Secretary Secretary of Labor (f) State (g) State UC agency (h) State UC law (i) Unemployment compensation (j) UC information State UC information (k) Wage information (1) Wages paid to an individual, (2) Social security account number (or numbers, if more than one) of such individual, and (3) Name, address, State, and the Federal employer identification number of the employer who paid such wages to such individual. [71 FR 56842, Sept. 27, 2006, as amended at 81 FR 56333, Aug. 19, 2016] Subpart B—Confidentiality and Disclosure Requirements § 603.3 What is the purpose and scope of this subpart? This subpart implements the basic confidentiality requirement derived from Section 303(a)(1), SSA, and the disclosure requirements of Sections 303(a)(7), (c)(1), (d), (e), (h), and (i), SSA, and Section 3304(a)(16), Federal Unemployment Tax Act (FUTA). This subpart also establishes uniform minimum requirements for the payment of costs, safeguards, and data-sharing agreements when UC information is disclosed, and for conformity and substantial compliance with this proposed rule. This subpart applies to States and State UC agencies, as defined in § 603.2(f) and (g), respectively. § 603.4 What is the confidentiality requirement of Federal UC law? (a) Statute. (b) Interpretation. (c) Application. § 603.5 What are the exceptions to the confidentiality requirement? The following are exceptions to the confidentiality requirement. Disclosure of confidential UC information is permissible under the exceptions in paragraphs (a) through (g) of this section only if authorized by State law and if such disclosure does not interfere with the efficient administration of the State UC law. Disclosure of confidential UC information is permissible under the exceptions in paragraphs (h) and (i) of this section without such restrictions. (a) Public domain information. (b) UC appeals records. (c) Individual or employer. (d) Informed consent. (1) Agent (i) In general— (A) The agent presents a written release (which may include an electronically submitted release that the State determines is authentic) from the individual or employer being represented; (B) When a written release is impossible or impracticable to obtain, the agent presents such other form of consent as is permitted by the State UC agency in accordance with State law; (ii) In the case of an elected official performing constituent services, the official presents reasonable evidence (such as a letter from the individual or employer requesting assistance or a written record of a telephone request from the individual or employer) that the individual or employer has authorized such disclosure; or (iii) In the case of an attorney retained for purposes related to the State's UC law, the attorney asserts that he or she is representing the individual or employer. (2) Third party (other than an agent) or disclosure made on an ongoing basis (i) The release must be signed and must include a statement— (A) Specifically identifying the information that is to be disclosed; (B) That State government files will be accessed to obtain that information; (C) Of the specific purpose or purposes for which the information is sought and a statement that information obtained under the release will only be used for that purpose or purposes; and (D) Indicating all the parties who may receive the information disclosed. (ii) The purpose specified in the release must be limited to— (A) Providing a service or benefit to the individual signing the release that such individual expects to receive as a result of signing the release; or (B) Carrying out administration or evaluation of a public program to which the release pertains. Note to paragraph ( d The Electronic Signatures in Global and National Commerce Act of 2000 (E-Sign), Pub. L. 106-229, may apply where a party wishes to effectuate electronically an informed consent release (§ 603.5(d)(2)) or a disclosure agreement (§ 603.10(a)) with an entity that uses informed consent releases. E-Sign, among other things, sets forth the circumstances under which electronic signatures, contracts, and other records relating to such transactions (in lieu of paper documents) are legally binding. Thus, an electronic communication may suffice under E-Sign to establish a legally binding contract. The States will need to consider E-Sign's application to these informed consent releases and disclosure agreements. In particular, a State must, to conform and substantially comply with this regulation, assure that these informed consent releases and disclosure agreements are legally enforceable. If an informed consent release or disclosure agreement is to be effectuated electronically, the State must determine whether E-Sign applies to that transaction, and, if so, make certain that the transaction satisfies the conditions imposed by E-Sign. The State must also make certain that the electronic transaction complies with every other condition necessary to make it legally enforceable. (e) Public official. (1) “Performance of official duties” means administration or enforcement of law or the execution of the official responsibilities of a Federal, State, or local elected official. Administration of law includes research related to the law administered by the public official. Execution of official responsibilities does not include solicitation of contributions or expenditures to or on behalf of a candidate for public or political office or a political party. (2) For purposes of § 603.2(d)(2) through (5), “performance of official duties” includes, in addition to the activities set out in paragraph (e)(1) of this section, use of the confidential UC information for the following limited purposes: (i) State and local performance accountability under WIOA sec. 116, including eligible training provider performance accountability under WIOA secs. 116(d) and 122; (ii) The requirements of discretionary Federal grants awarded under WIOA; or (iii) As otherwise required for education or workforce training program performance accountability and reporting under Federal or State law. (f) Agent or contractor of public official. (g) Bureau of Labor Statistics. (h) Court order; official with subpoena authority. (i) UC Program Oversight and Audits. [71 FR 56842, Sept. 27, 2006, as amended at 81 FR 56333, Aug. 19, 2016] § 603.6 What disclosures are required by this subpart? (a) The confidentiality requirement of 303(a)(1), SSA, and § 603.4 are not applicable to this paragraph (a) and the Department of Labor interprets Section 303(a)(1), SSA, as requiring disclosure of all information necessary for the proper administration of the UC program. This includes disclosures to claimants, employers, the Internal Revenue Service (for purposes of UC tax administration), and the U.S. Citizenship and Immigration Services (for purposes of verifying a claimant's immigration status). (b) In addition to Section 303(f), SSA (concerning an IEVS), which is addressed in subpart C, the following provisions of Federal UC law also specifically require disclosure of State UC information and State-held information pertaining to the Federal UC and benefit programs of Unemployment Compensation for Federal Employees (UCFE), Unemployment Compensation for Ex-Servicemembers (UCX), Trade Adjustment Assistance (TAA) (except for confidential business information collected by States), Disaster Unemployment Assistance (DUA), and any Federal UC benefit extension program: (1) Section 303(a)(7), SSA, requires State law to provide for making available, upon request, to any agency of the United States charged with the administration of public works or assistance through public employment, disclosure of the following information with respect to each recipient of UC— (i) Name; (ii) Address; (iii) Ordinary occupation; (iv) Employment status; and (v) A statement of such recipient's rights to further compensation under the State law. (2) Section 303(c)(1), SSA, requires each State to make its UC records available to the Railroad Retirement Board, and to furnish such copies of its UC records to the Railroad Retirement Board as the Board deems necessary for its purposes. (3) Section 303(d)(1), SSA, requires each State UC agency, for purposes of determining an individual's eligibility benefits, or the amount of benefits, under a food stamp program established under the Food Stamp Act of 1977, to disclose, upon request, to officers and employees of the Department of Agriculture, and to officers or employees of any State food stamp agency, any of the following information contained in the records of the State UC agency— (i) Wage information, (ii) Whether an individual is receiving, has received, or has made application for, UC, and the amount of any such compensation being received, or to be received, by such individual, (iii) The current (or most recent) home address of such individual, and (iv) Whether an individual has refused an offer of employment and, if so, a description of the employment so offered and the terms, conditions, and rate of pay therefore. (4) Section 303(e)(1), SSA, requires each State UC agency to disclose, upon request, directly to officers or employees of any State or local child support enforcement agency, any wage information contained in the records of the State UC agency for purposes of establishing and collecting child support obligations (not to include custodial parent support obligations) from, and locating, individuals owing such obligations. (5) Section 303(h), SSA, requires each State UC agency to disclose quarterly, to the Secretary of Health and Human Services (HHS), wage information and claim information as required under Section 453(i)(1) of the SSA (establishing the National Directory of New Hires), contained in the records of such agency, for purposes of Subsections (i)(1), (i)(3), and (j) of Section 453, SSA (establishing the National Directory of New Hires and its uses for purposes of child support enforcement, Temporary Assistance to Needy Families (TANF), TANF research, administration of the earned income tax credit, and use by the Social Security Administration). (6) Section 303(i), SSA, requires each State UC agency to disclose, upon request, to officers or employees of the Department of Housing and Urban Development (HUD) and to representatives of a public housing agency, for purposes of determining an individual's eligibility for benefits, or the amount of benefits, under a housing assistance program of HUD, any of the following information contained in the records of such State agency about any individual applying for or participating in any housing assistance program administered by HUD who has signed a consent form approved by the Secretary of HUD— (i) Wage information, and (ii) Whether the individual is receiving, has received, or has made application for, UC, and the amount of any such compensation being received (or to be received) by such individual. (7) Section 3304(a)(16), FUTA requires each State UC agency— (i) To disclose, upon request, to any State or political subdivision thereof administering a Temporary Assistance to Needy Families Agency (TANF) program funded under part A of Title IV of the SSA, wage information contained in the records of the State UC agency which is necessary (as determined by the Secretary of HHS in regulations) for purposes of determining an individual's eligibility for TANF assistance or the amount of TANF assistance; and (ii) To furnish to the Secretary of HHS, in accordance with that Secretary's regulations at 45 CFR 303.108, wage information (as defined at 45 CFR 303.108(a)(2)) and UC information (as defined at 45 CFR 303.108(a)(3)) contained in the records of such agency for the purposes of the National Directory of New Hires established under Section 453(i) of the SSA. (8) To comply with WIOA sec. 116(e)(4), States must, to the extent practicable, cooperate in the conduct of evaluations (including related research projects) provided for by the Secretary of Labor or the Secretary of Education under the provisions of Federal law identified in WIOA sec. 116(e)(1); WIOA secs. 169 and 242(c)(2)(D); sec. 12(a)(5), 14, and 107 of the Rehabilitation Act of 1973 (29 U.S.C. 709(a)(5), 711, 727) (applied with respect to programs carried out under title I of that Act (29 U.S.C. 720 et seq. (c) Each State law must contain provisions that are interpreted and applied consistently with the requirements listed in this section. [71 FR 56842, Sept. 27, 2006, as amended at 81 FR 56333, Aug. 19, 2016] § 603.7 What requirements apply to subpoenas, other compulsory processes, and disclosure to officials with subpoena authority? (a) In general. (b) Exceptions. (1) Court Decision (2) Official with subpoena authority § 603.8 What are the requirements for payment of costs and program income? (a) In general. (b) Use of grant funds permitted. (c) Calculation of costs. (d) Payment of costs. reciprocal (e) Program income. § 603.9 What safeguards and security requirements apply to disclosed information? (a) In general. (b) Safeguards to be required of recipients. (i) Require the recipient to use the disclosed information only for purposes authorized by law and consistent with an agreement that meets the requirements of § 603.10; (ii) Require the recipient to store the disclosed information in a place physically secure from access by unauthorized persons; (iii) Require the recipient to store and process disclosed information maintained in electronic format, such as magnetic tapes or discs, in such a way that unauthorized persons cannot obtain the information by any means; (iv) Require the recipient to undertake precautions to ensure that only authorized personnel are given access to disclosed information stored in computer systems; (v) Require each recipient agency or entity to: (A) Instruct all personnel having access to the disclosed information about confidentiality requirements, the requirements of this subpart B, and the sanctions specified in the State law for unauthorized disclosure of information, and (B) Sign an acknowledgment that all personnel having access to the disclosed information have been instructed in accordance with paragraph (b)(1)(v)(A) of this section and will adhere to the State's or State UC agency's confidentiality requirements and procedures which are consistent with this subpart B and the agreement required by § 603.10, and agreeing to report any infraction of these rules to the State UC agency fully and promptly, (vi) Require the recipient to dispose of information disclosed or obtained, and any copies thereof made by the recipient agency, entity, or contractor, after the purpose for which the information is disclosed is served, except for disclosed information possessed by any court. Disposal means return of the information to the disclosing State or State UC agency or destruction of the information, as directed by the State or State UC agency. Disposal includes deletion of personal identifiers by the State or State UC agency in lieu of destruction. In any case, the information disclosed must not be retained with personal identifiers for longer than such period of time as the State or State UC agency deems appropriate on a case-by-case basis; and (vii) Maintain a system sufficient to allow an audit of compliance with the requirements of this part. (2) In the case of disclosures made under § 603.5(d)(2) (to a third party (other than an agent) or disclosures made on an ongoing basis), the State or State UC agency must also— (i) Periodically audit a sample of transactions accessing information disclosed under that section to assure that the entity receiving disclosed information has on file a written release authorizing each access. The audit must ensure that the information is not being used for any unauthorized purpose; (ii) Ensure that all employees of entities receiving access to information disclosed under § 603.5(d)(2) are subject to the same confidentiality requirements, and State criminal penalties for violation of those requirements, as are employees of the State UC agency. (c) Redisclosure of confidential UC information. (i) To the individual or employer who is the subject of the information; (ii) To an attorney or other duly authorized agent representing the individual or employer; (iii) In any civil or criminal proceedings for or on behalf of a recipient agency or entity; (iv) In response to a subpoena only as provided in § 603.7; (v) To an agent or contractor of a public official only if the person redisclosing is a public official, if the redisclosure is authorized by the State law, and if the public official retains responsibility for the uses of the confidential UC information by the agent or contractor; (vi) From one public official to another if the redisclosure is authorized by the State law; (vii) When so authorized by Section 303(e)(5), SSA, (redisclosure of wage information by a State or local child support enforcement agency to an agent under contract with such agency for purposes of carrying out child support enforcement) and by State law; or (viii) When specifically authorized by a written release that meets the requirements of § 603.5(d) (to a third party with informed consent). (2) Information redisclosed under paragraphs (c)(1)(v) and (vi) of this section must be subject to the safeguards in paragraph (b) of this section. (d) The requirements of this section do not apply to disclosures of UC information to a Federal agency which the Department has determined, by notice published in the Federal Register, § 603.10 What are the requirements for agreements? (a) Requirements. (2) For disclosures referred to in § 603.5(f) (to an agent or contractor of a public official), the State or State UC agency must enter into a written, enforceable agreement with the public official on whose behalf the agent or contractor will obtain information. The agreement must hold the public official responsible for ensuring that the agent or contractor complies with the safeguards of § 603.9. The agreement must be terminable if the State or State UC agency determines that the safeguards in the agreement are not adhered to. (b) Contents of agreement In general. (i) A description of the specific information to be furnished and the purposes for which the information is sought; (ii) A statement that those who request or receive information under the agreement will be limited to those with a need to access it for purposes listed in the agreement; (iii) The methods and timing of requests for information and responses to those requests, including the format to be used; (iv) Provision for paying the State or State UC agency for any costs of furnishing information, as required by § 603.8 (on costs); (v) Provision for safeguarding the information disclosed, as required by § 603.9 (on safeguards); and (vi) Provision for on-site inspections of the agency, entity, or contractor, to assure that the requirements of the State's law and the agreement or contract required by this section are being met. (2) In the case of disclosures under § 603.5(d)(2) (to a third party (other than an agent) or disclosures made on an ongoing basis), the agreement required by paragraph (a) of this section must assure that the information will be accessed by only those entities with authorization under the individual's or employer's release, and that it may be used only for the specific purposes authorized in that release. (c) Breach of agreement In general. (2) Enforcement. (d) The requirements of this section do not apply to disclosures of UC information to a Federal agency which the Department has determined, by notice published in the Federal Register, Federal Register. § 603.11 How do States notify claimants and employers about the uses of their information? (a) Claimants. (b) Employers. § 603.12 How are the requirements of this part enforced? (a) Resolving conformity and compliance issues. (b) Conformity and substantial compliance. (1) The requirements of Title III, SSA, implemented in subparts B and C of this part, the Secretary of Labor shall notify the Governor of the State and such State UC agency that further payments for the administration of the State UC law will not be made to the State until the Secretary of Labor is satisfied that there is no longer any such failure. Until the Secretary of Labor is so satisfied, the Department of Labor shall make no further payments to such State. (2) The FUTA requirements implemented in this subpart B, the Secretary of Labor shall make no certification under that section to the Secretary of the Treasury for such State as of October 31 of the 12-month period for which such finding is made. Subpart C—Mandatory Disclosure for Income and Eligibility Verification System (IEVS) § 603.20 What is the purpose and scope of this subpart? (a) Purpose. (b) Scope. Note to paragraph ( b Although not implemented in this part 603, Section 1137(a)(1), SSA, provides that each State must require claimants for compensation to furnish to the State UC agency their social security account numbers, as a condition of eligibility for compensation, and further requires States to utilize such account numbers in the administration of the State UC laws. Section 1137(a)(3), SSA, further provides that employers must make quarterly wage reports to a State UC agency, or an alternative agency, for use in verifying eligibility for, and the amount of, benefits. Section 1137(d)(1), SSA, provides that each State must require claimants for compensation, as a condition of eligibility, to declare in writing, under penalty of perjury, whether the individual is a citizen or national of the United States, and, if not, that the individual is in a satisfactory immigration status. Other provisions of Section 1137(d), SSA, not implemented in this regulation require the States to obtain, and individuals to furnish, information which shows immigration status, and require the States to verify immigration status with the Bureau of Citizenship and Immigration Services. § 603.21 What is a requesting agency? For the purposes of this subpart C, requesting agency (a) Temporary Assistance to Needy Families Agency (b) Medicaid Agency (c) Food Stamp Agency (d) Other SSA Programs Agency (e) Child Support Enforcement Agency (f) Social Security Administration § 603.22 What information must State UC agencies disclose for purposes of an IEVS? (a) Disclosure of information. (b) Format. § 603.23 What information must State UC agencies obtain from other agencies, and crossmatch with wage information, for purposes of an IEVS? (a) Crossmatch with information from requesting agencies. (b) Crossmatch of wage and benefit information.