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Written By ESR News Blog Editor Thomas Ahearn
As a result of an October 6, 2015 ruling by the European Court of Justice invalidating the “Safe Harbor” pact that allowed the transfer of personal data between the European Union (EU) and the United States (U.S.), privacy concerns will loom large between the EU and U.S. in terms of international background checks in 2016. This is the number 10 trend selected by Employment Screening Resources® (ESR) Founder and CEO Attorney Lester Rosen for the 9th annual ESR Top Ten Background Check Trends for 2016.
“The issue of international background checks continues to be critical to U.S. employers as they both hire individuals who worked or went to school outside of the country, or they open offices overseas,” says Rosen, author of ‘The Safe Hiring Manual’ and a noted background check expert. “Either way, due diligence is mission critical and central to the process is dealing with privacy and data protection laws.”
In a statement about the ruling, U.S. Secretary of Commerce Penny Pritzker said the Safe Harbor framework decision “creates significant uncertainty for both U.S. and EU companies and consumers, and puts at risk the thriving transatlantic digital economy.” The Safe Harbor webpage contains an Advisory about the ruling that states “the Department of Commerce will continue to administer the Safe Harbor program, including processing submissions for self-certification to the Safe Harbor Framework.”
On October 16, 2015, privacy watchdog group Article 29 Working Party issued a statement calling on the U.S. and EU to find a new solution by the end of January 2016 to avoid possible enforcement action: If by the end of January 2016, no appropriate solution is found with the U.S. authorities and depending on the assessment of the transfer tools by the Working Party, EU data protection authorities are committed to take all necessary and appropriate actions, which may include coordinated enforcement actions.
In November 2015, the European Commission issued guidance on transatlantic data transfers and is urging the establishment of a new data transfer agreement between the U.S. and EU that replaces the invalidated Safe Harbor pact by the end of January 2016. Following the ruling invalidating Safe Harbor, the Commission stepped up negotiations with the U.S. on a new data transfer network and hopes to conclude these discussions by the end of January 2016 stressing the following points:
- The Safe Harbor arrangement can no longer serve as a legal basis for transfers of personal data to the U.S.
- The Commission will continue and finalize negotiations for a renewed and sound framework for transatlantic transfers of personal data, which must meet the requirements identified in the Court ruling, notably as regards limitations and safeguards on access to personal data by U.S. public authorities.
- Other adequacy decisions will need to be amended, to ensure that Data Protection Authorities (DPAs) remain free to investigate complaints by individuals.
“The EU data privacy issues are not only critical because EU counties are a large source of applicants and business opportunities for U.S. business, but also the fact that numerous other counties have similar requirements,” adds Rosen, a frequent speaker on background check issues. “Consequently the ability to obtain and transfer data is of critical importance, and employers need to closely monitor this issue.”
As reported earlier by ESR News, the ruling invalidating the Safe Harbor data transfer agreement stems from the case of Maximillian Schrems v. Data Protection Commissioner where an Austrian citizen and Facebook user lodged a privacy complaint with the Irish supervisory authority about his data being transferred to servers in the U.S. for processing. The complaint claimed the U.S. did not offer sufficient protection against government surveillance due to revelations made by defector Edward Snowden.
ESR Protects the Privacy of Consumer Data
Employment Screening Resources® (ESR), a leading global screening firm, has announced the completion of the SOC 2® Type 2 Data Security Audit that confirms ESR meets high standards set by the American Institute of Certified Public Accountants (AICPA) for protecting the security, confidentiality, and privacy of consumer data used for background checks. A list of the ‘ESR Top Ten Background Check Trends for 2016’ will be available at https://www.esrcheck.com/ESR-Top-Ten-Background-Check-Trends.
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