Employees’ SSNs off limits in FLSA litigation

The time to confirm employees’ Social Security numbers (SSNs) is when they’re hired, not when you’re slapped with a lawsuit for unpaid overtime and minimum wage violations. A federal trial court has ruled that an employer was out of bounds in requesting this information. (Uto et al. v. Job Site Services, Inc. et al., No. CV-10-0529 (SJF) (ETB), D.C., E.N.Y., 2010)

No snooping allowed

Former employees sued their company and the company’s owner personally, alleging that they weren’t paid overtime or the minimum wage. As part of the lawsuit, the company asked the court to have employees disclose their SSNs and their tax returns. The employees wanted this request thrown out, arguing that it was an indirect way of discovering their immigration status.

The trial court agreed with the employees. Court: All employees, regardless of their immigration status, are protected by the Fair Labor Standards Act (FLSA), so requiring employees to disclose their SSNs isn’t relevant and presents a danger of intimidation that would inhibit them from pursuing their rights. Being forced to disclose their tax returns also wasn’t relevant to the FLSA litigation, the court said.

Cutting corners doesn’t pay

This case is a good reminder that you can only go so far in defending the company’s FLSA policies and practices. This company racked up large attorneys’ bills for no return. It could have avoided the whole ruckus if Payroll or HR had asked to see employees’ SSNs when they were hired, and then used the Social Security Administration’s Social Security Number Verification Service (SSNVS) to determine whether those SSNs were legitimate. If new hires fail to present their SSNs upon request, or if SSNVS reveals problems with their SSNs that they can’t resolve within a reasonable amount of time, new hires should be terminated. Waiting for them to file an FLSA lawsuit is too late.