26.05.2020

The new Privacy Act: What will this mean for your Business?

The long awaited reform to New Zealand privacy law is currently making its way through the final stages in Parliament, and is expected to become law on 1 November 2020. The Privacy Bill (which when enacted will become the Privacy Act 2020) will replace the Privacy Act 1993. While large parts of the current Act remain, there are significant changes designed to improve New Zealand organisations’ privacy compliance. Now is a good time to consider whether changes are required to your privacy policy and employment agreements to ensure you do not incur the wrath of the Office of the Privacy Commissioner.

Key changes

The Privacy Act 2020 will introduce some important changes. The key changes include:

  • A mandatory requirement for businesses to report serious breaches of privacy that pose a risk of harm, loss, or damage to the individual to the Privacy Commissioner (this requirement follows the position of the Australian and European Privacy Laws);
  • Strengthening cross-border data protection by requiring New Zealand agencies to ensure that all personal information shared with an overseas entity is protected;
  • Extension of the Privacy Act to all agencies carrying out business in New Zealand (whether they have a physical presence in New Zealand or not);
  • Introduction of new criminal offences with a fine of up to $10,000 if a business misleads an agency or attempts to destroy documents with personal information; and
  • Strengthening the Privacy Commissioner’s power to gather information from an agency by reducing timeframes and increasing penalties from $2,000 to $10,000.

Stronger enforcement and compliance

The Privacy Act 2020 will introduce a number of new enforcement and compliance provisions that will give the Privacy Commissioner greater power to ensure that the statute is adhered to.

Importantly, the Privacy Commissioner will have the power to serve businesses with compliance notices in response to a breach of the Act, and to instruct the business to release personal information held by that business to the affected individual. The Privacy Commissioner will be assisted by the Human Rights Review Tribunal to enforce compliance notices. If the business fails to report a privacy breach to the Privacy Commissioner, it could face a fine of up to $10,000 (being a notable increase from the previous $2,000 maximum limit). While the new Act does raise the penalty amount, the regime is considered to be at a low level compared to other jurisdictions’ regimes, such as Canada (where the penalty for not reporting a privacy breach could be as high as NZ$120,000 or even higher in some cases).

Another important change is the strengthening of the Privacy Commissioner’s power to carry out investigations into breaches of privacy complaints by having shorter time frames in place within which a business is required to respond and provide the requested information. Where a business fails to provide the requested information, it could be liable to a fine of $10,000.

Advice for businesses and agencies

Overall, the changes that the Privacy Act 2020 introduces are likely to have an impact on the operation of your business. While the Act is not yet in force, it is important that your business starts taking preparatory steps to ensure that its privacy policies and employment agreements are up to date. As a preliminary step, we recommend that you:

  • Review your privacy policy and employment agreement to see if it complies with the Act (this includes reviewing your business’s privacy statement and making changes where necessary); and
  • Check your current systems to ensure that all personal information is held safely and securely (this includes employee, employer, and any customer or other third-party information that is held by your organisation).

Businesses should view privacy protection as a cultural norm. If you have any questions or want to discuss how the new Privacy Act 2020 is likely to impact your business, please contact one of the members of our Employment Law Team.

Disclaimer:  The information contained in this article is current at the date of publishing and is of a general nature.  It should be used as a guide only and not as a substitute for obtaining legal advice.  Specific legal advice should be sought where required.

 

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