Question 171 - CIPP-US discussion

Mega Corp. is a U.S.-based business with employees in California, Virginia, and Colorado. Therefore, it must comply with the privacy laws of these three states in regard to its human resources data, unless it qualifies for an exemption under each law.

The California Privacy Rights Act (CPRA) is an amendment to the California Consumer Privacy Act (CCPA) that was approved by voters in November 2020 and will take effect on January 1, 2023. The CPRA expands the rights and protections of California residents with respect to their personal information and creates a new category of sensitive personal information that includes certain employment-related data, such as Social Security numbers, driver's license numbers, passport numbers, financial account information, biometric information, and geolocation data. The CPRA also establishes a new enforcement agency, the California Privacy Protection Agency, to oversee and enforce the law.

The Virginia Consumer Data Protection Act (VCDPA) is a comprehensive privacy law that was enacted in March 2021 and will take effect on January 1, 2023. The VCDPA grants Virginia residents several rights with respect to their personal data, such as the right to access, correct, delete, port, and opt out of certain processing activities. The VCDPA also imposes various obligations on businesses that control or process personal data of Virginia residents, such as conducting data protection assessments, entering into contracts with processors, and providing privacy notices.

The Colorado Privacy Act (CPA) is another comprehensive privacy law that was enacted in July 2021 and will take effect on July 1, 2023. The CPA grants Colorado residents similar rights as the VCDPA, with some variations, such as the right to appeal a business's response to a request and the right to opt out of targeted advertising, the sale of personal data, and certain profiling activities. The CPA also imposes similar obligations as the VCDPA, with some differences, such as requiring opt-in consent for the processing of sensitive data and allowing businesses to join a universal opt-out mechanism.

All three laws apply to businesses that conduct business in or target consumers in the respective states and meet certain thresholds of revenue or data processing volume. However, all three laws also provide exemptions for certain types of data or entities that are subject to other federal or state laws, such as the Gramm-Leach-Bliley Act (GLBA), the Health Insurance Portability and Accountability Act (HIPAA), the Fair Credit Reporting Act (FCRA), and the Family Educational Rights and Privacy Act (FERPA).

One of the exemptions that may be relevant for Mega Corp. is the employee data exemption, which excludes personal data that is collected and used by an employer within the context of an employment relationship or for emergency contact or benefits administration purposes. However, this exemption is not permanent or uniform across the three laws. The CPRA's employee data exemption is set to expire on January 1, 2023, unless extended by the legislature. The VCDPA's employee data exemption is set to expire on January 1, 2023, unless repealed by the legislature. The CPA's employee data exemption does not have an expiration date, but it does not apply to the right to opt out of the sale of personal data or the right to appeal a business's response to a request.

Therefore, depending on the type and scope of the human resources data that Mega Corp. collects and processes, it may have to comply with the California Privacy Rights Act, the Virginia Consumer Data Protection Act, and the Colorado Privacy Act, unless it qualifies for another exemption under each law.

[IAPP CIPP/US Study Guide], Chapter 10: State Data Security Laws, pp. 227-229.

CIPP/US Practice Questions (Sample Questions), Question 32.