In the ever-evolving landscape of data privacy, the California Privacy Rights Act, or CPRA, stands as an important milestone. Enacted to bolster the protection of personal information, the CPRA builds upon its predecessor, the CCPA (California Consumer Privacy Act). As consumers become increasingly concerned about their data, understanding the CPRA regulations is essential for individuals and businesses alike.
Understanding the CPRA’s Scope
The California Privacy Rights Act (CPRA), is a significant amendment to the California Consumer Privacy Act and introduces new provisions and expands on existing ones, aiming to strengthen consumer privacy rights and data protection in California.
The CPRA regulations apply to many businesses dealing with personal information of California residents either directly or indirectly unless excluded by specific categories. In fact, the CPRA extends data privacy to employee data for the first time, requiring employers to better manage their employee data.
Expansion of Consumer Rights
The CPRA provides an expanded framework of privacy rights, enhancing the protections laid out in the California privacy law. In particular, the CPRA regulations focus more precisely on the consumer’s right to correct inaccurate personal data, the right to restrict the processing of sensitive personal data, and the right to data mobility.
These changes significantly increase the ability for consumers to control and manage their personal data in alignment with global privacy summit discussions on modern data rights and protections.
Inclusion of New Categories of Personal Information
One of the most significant developments brought by the CPRA is the inclusion of new categories of personal information. These categories extend the definition of personal information beyond that of the CCPA, highlighting data such as geolocation, race, ethnicity, religion, genetic data, private communications, biometric data, health information, and sexual orientation.
This aspect of the CPRA ties in closely with ongoing discussions on AI governance and the need for safeguards against the misuse of sensitive data. It recognizes a broader scope of data as sensitive and deserving of robust protections, for example through the use of “dark patterns” in user interface design.
CPRA and Employee Data
While the CCPA focused on consumer data, the CPRA also has implications for employee data. Under the CPRA, employee data now falls under the definition of personal information. This means employers have obligations to honor employee data access, correction, and deletion requests.
However, the CPRA does carve out exemptions for employee data used in certain contexts like managing benefits or leave time. Employers should closely review regulations to understand CPRA obligations regarding employee records.
Key Changes to Data Processing Practices
Enhanced Consent Requirements
One of the main changes introduced by the California Privacy Rights Act regulations is the emphasis on clear and affirmatively given consent. The final CPRA regulations increase the requirements for explicit consent, particularly before businesses can use sensitive personal information for a secondary purpose or before sharing or selling such information. This new consent structure gives consumers more control over their personal data and aligns closely with privacy pros’ recommendations and other robust state privacy laws.
Restrictions on Data Sharing and Sales
The CPRA imposes stricter rules on data sharing and the sales of personal information. Under the CPRA regs, the sale or sharing of personal information is prohibited unless the consumer has been clearly notified of these practices and has given explicit consent.
In case of a business selling or sharing the personal data of a minor, an affirmative authorization (e.g., “double opt-in”) from the minor, or from a parent or guardian in the case of minors under 13, is required. Such requirements are part of the broad aim of the CPRA to empower consumers and promote transparency in businesses’ data practices. These rules also reflect the views of privacy professionals and Corporate Members of the IAPP’s KnowledgeNet Chapter, who emphasize the importance of informed, affirmative consent in data practices.
Obligations for Business Compliance and Implementation
The California Consumer Privacy Act and the California Privacy Rights Act have brought significant changes to the state privacy laws, moving California towards stronger data protection and privacy rights. Understanding the CPRA regulations and applying the required rulemaking activities is crucial for firms to avoid hefty penalties and cybersecurity audits.
Under these regulations, businesses are obligated to pay attention to several aspects of their operations including the transparent collection and storage of personal data and the protection of consumers’ privacy rights. The California Privacy Protection Agency is charged with enforcing these rulemaking activities.
Obligations Based on Business Size
One of the more notable characteristics of California privacy law is that the obligations vary depending on business size. The CPRA regulations apply primarily to businesses that have an annual gross income exceeding $25 million, handle the personal information of 100,000 or more California residents, or derive at least half of their annual revenue from selling California residents’ personal information.
The CPRA regulations require these businesses to explicitly notify consumers about data collection and sharing practices, provide means to opt out of data selling and respond promptly to requests for data deletion. Smaller businesses also have obligations, yet they are typically less stringent. However, any business dealing with the personal information of California residents could be held to account under these laws.
Impact on Third-party Service Providers
Not only does the CPRA apply to businesses directly, but it also has a significant impact on third-party service providers. Under the CPRA regulations, businesses must ensure that their service providers adhere to the same CPRA regs regarding the protection of consumer privacy.
This includes the obligation to protect personal data, to grant the rights to access and delete personal data, and comply with the prohibition on selling personal information without consent. In turn, service providers are expected to assist businesses in complying with privacy rights requests.
Data Protection Measures
With the California Privacy Rights Act regulations, there’s a strong emphasis on data protection measures to safeguard consumers’ personal information. Businesses are required to conduct regular risk assessments and implement appropriate security measures to protect consumers’ data.
Data Minimization and Retention Policies
One such measure is data minimization, which stipulates that businesses should only collect and retain the personal information necessary to fulfill the specified purpose. This means that unnecessary or excessive data collection is considered a bad practice under the CPRA.
Moreover, explicit data retention policies that outline how long personal data will be stored and when it will be deleted should be established and communicated to consumers. Businesses must not retain personal data for longer than necessary for the specific purpose, another measure to minimize data.
Safeguarding Consumer Rights Requests
Under the CPRA, consumers can request access to their personal data, request deletion of data, and opt out of the selling of their personal data. Businesses should make these requests simple to execute, avoiding any dark patterns in user interface design that could undermine these rights.
There is also a requirement for ensuring that service providers honor these requests promptly and do not misuse personal data. For businesses, safeguarding and efficiently handling these requests is a key obligation under the CPRA regulations.
Understanding Enforcement of California Privacy Laws
The California Privacy Rights Act empowers robust enforcement of the CPRA through the newly created California Privacy Protection Agency (CPPA) as well as the Attorney General. This represents a major expansion of enforcement capabilities compared to the previous law.
Scope of CPRA Enforcement Authority
The CPPA and Attorney General have broad authority to enforce the CPRA and levy penalties for violations. The CPPA can conduct investigations, cybersecurity audits, and risk assessments. It also has the ability to regulate businesses’ data practices and interfaces to protect consumer privacy rights.
Both agencies can issue substantial administrative fines for CPRA violations. Fines range from $2,500 per violation up to $7,500 per intentional violation. Penalties accumulate quickly, especially regarding minors’ data and violations of service provider regulations.
CPRA Violations and Legal Liabilities
In addition to regulatory fines, the CPRA allows consumers to bring private lawsuits for certain violations. Businesses may have to pay damages, court costs, and attorneys’ fees as a result. This creates major legal liability risks for non-compliant companies.
Importance of Following CPRA Regulations
Given the expansive enforcement powers and substantial penalties, businesses should closely monitor and comply with CPRA regulations as they develop. Key areas to focus on include service provider requirements, sensitive data handling, data discovery obligations, and enabling consumer privacy rights. Robust privacy programs and understanding of regulations is crucial.
By following CPRA regulations, businesses can avoid enforcement actions and legal liabilities. But failure to comply brings serious financial and legal consequences from the new enforcement regime.
The Vault Verify Advantage
At Vault Verify, privacy and compliance are at the core of our employment and income verification solutions. We understand the sensitivity of employee personal information and are committed to handling it responsibly. Our systems and processes adhere to CPRA, FCRA, and other key regulations governing employee data use. We collect only necessary verification information and retain it securely with encryption and access controls.
When you work with us, you get full-picture custom reporting, 24/7 online access with top-rated encryption, and free API integration with payroll/HRIS systems. And of course, we’re committed to safeguarding sensitive data every step of the way.
Vault Verify’s combination of cutting-edge tech and world-class support provides all-in-one protection and optimization of the most valuable asset in your business – your workforce. Request a demo today to see how our services can work for you.
What are the new CPRA requirements?
The new CPRA requirements expand and enhance the existing privacy rights provided by the California Consumer Privacy Act. Some key provisions of the CPRA include the creation of the new category of “sensitive personal information” and granting consumers the right to limit the use and disclosure of this data. It also establishes a new enforcement agency called the California Privacy Protection Agency. Additionally, the CPRA introduces new obligations for businesses, such as conducting regular cybersecurity audits and risk assessments, as well as implementing safeguards to protect consumer data. The CPRA also increases fines and penalties for violations, particularly for the mishandling of information belonging to minors.
What are the changes between CCPA and CPRA?
The California Consumer Privacy Act and the California Privacy Rights Act are two privacy laws enacted in California. While the CCPA was the first comprehensive privacy law in the United States, the CPRA introduced certain changes to further enhance consumer privacy rights. The CPRA expands some CCPA provisions by introducing new categories of personal information, such as precise geolocation data and sensitive personal information. Additionally, the CPRA introduces new consumer rights and extends data privacy to employee data for the first time, requiring employers to better manage their employee data.
What are the major changes in the CPRA?
The CPRA brings about several significant changes to data privacy laws. Some of the major changes include the introduction of sensitive personal information categories, such as precise geolocation, race, religion, and health data, which require heightened protection. The CPRA also expands the rights of individuals by granting them the ability to limit the use of their sensitive information and to correct inaccurate personal data. Businesses are now required to implement additional security measures and conduct regular cybersecurity audits. The CPRA extends data privacy to employee data and would requite employers to better manage their employee data.