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Privacy law

The Privacy Act has been setting the boundaries for our right to privacy since 1993. The Act mainly deals with the collection and disclosure of personal information. We explain the basic principles of the Act and its limitations, describe the complaints process, and look at ways in which the Act could be improved.

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What the Act covers

The Privacy Act 1993 deals mainly with the collection and disclosure of personal information. It’s more about information privacy than other aspects of privacy.

The Act has 12 principles that stipulate how information can be collected and used, and people’s rights to gain access to that information and ask for it to be corrected.

Principle 1: Purpose of collection of personal information.
An agency may only collect personal information where it is needed to perform a function or activity of the agency.

Principle 2: Source of personal information.
The agency must collect the information directly from the person concerned. There are exceptions: for example, where the person agrees otherwise, or where the information is publicly available.

Principle 3: Collection of information from subject.
The agency must take all reasonable efforts to ensure the person is aware that the information is being collected, what it will be used for, the recipients of the information, whether the supply of the information is voluntary or mandatory, the consequences of not providing the information and the person’s rights of access to and correction of the information.

Principle 4: Manner of collection of personal information.
Personal information must not be collected in an unlawful, unfair or intrusive fashion.

Principle 5: Storage and security of personal information.
The agency must ensure the information is protected against loss, misuse, or unauthorised disclosure.

Principle 6: Access to personal information.
Where the information can be readily retrieved, the individual is entitled to confirmation of whether the information is held, and to have access to it. There are exceptions, for example, where disclosure would prevent detection of a criminal offence, or would involve a breach of someone else’s privacy.

Principle 7: Correction of personal information.
Individuals may request correction of information held. Where this is not agreed to by the agency, the individual may request that the information is tagged with a statement that the correction was sought and was refused.

Principle 8: Accuracy of personal information to be checked before use.
The agency must not use the information without taking reasonable steps to ensure it is accurate, up-to-date, complete, relevant and not misleading.

Principle 9: Agency not to keep personal information for longer than necessary.
The agency must not keep the information for any longer than it is needed for the purposes for which it was collected.

Principle 10: Limits on use of personal information.
Information collected for one purpose must not be used for any other purpose. There are exceptions: for example, where the agency reasonably believes the individual has authorised the further use, or that the information was from a publicly available publication.

Principle 11: Limits on disclosure of personal information.
The information must not be disclosed except in certain situations. These include where the disclosure is directly related to the purpose for which the information was collected, where the source of the information is a publicly available publication, and where the disclosure is authorised by the individual concerned.

Principle 12: Unique identifiers.

An agency must not assign a unique identifier to an individual unless doing so is necessary for the agency to carry out its functions efficiently. Where doing so is necessary, agencies must not use a unique identifier that has been assigned to that individual by another agency (the only exception is for certain taxation purposes).

Who it applies to

The Act covers government agencies, local councils, businesses, and individuals. There are some exceptions – for example, the news media, members of parliament, the Governor General, ombudsmen, and the courts are not covered by the Act.

The privacy law doesn’t just apply to clients and customers – all personal information is covered, including information about employees. All organisations are required to have a privacy officer to deal with privacy issues.

The Privacy Commissioner’s role

The Privacy Commissioner provides advice and education on privacy, investigates complaints, evaluates new legislation that may impinge on an individual’s rights, reviews data-matching programs, and issues codes of practice.

Codes of practice cover specific industries, agencies, activities, or types of personal information. Codes often adapt the provisions of the Act to a particular circumstance, group of organisations or type of information.

Two codes that most affect the lives of consumers are the Credit Reporting Privacy Code and the Health Information Privacy Code. Information about both these codes is on the Privacy Commissioner’s website.

Limitations of the Act

As the Privacy Act is a principle-based system, it is not enforceable in court. An aggrieved individual must make a complaint (see below) to the Privacy Commissioner alleging an “interference with privacy”. The Commissioner has no powers to fine or prosecute anyone or order an organisation to pay compensation.

There is an important exception – principle 6 (Access to personal information) is enforceable in court if it relates to personal information held by a public sector agency.

The Privacy Act can’t override other Acts that authorise or require personal information to be made available. Where it comes into conflict with the provisions of another Act, the other Act takes precedence. For example, schools must work within the Education Act. If the Privacy Act conflicted with the Education Act, the Education Act would override the Privacy Act.

Making a complaint

A breach of a principle or code of practice is an “interference with privacy” if, in the opinion of the Privacy Commissioner, the breach reaches the legal threshold.

“Interference with privacy” is a legal term that involves two aspects. First, there must be a breach of the law and second, there must be some harm that arose from it.

The complaints system

  • If you feel your privacy has been breached, ask to speak to the privacy officer of the organisation concerned.

  • If you don’t get a satisfactory response, you can complain to the Office of the Privacy Commissioner (OPC). The Office may ask you to fill out a complaint form. The form asks how you think your privacy has been breached and which principles or rules have been breached.

  • The OPC will investigate your complaint and form an opinion as to whether the breach is an “interference of privacy”. If your complaint has substance, the OPC will attempt to secure a settlement through mediation.

  • If your complaint is unable to be settled, the OPC can refer the complaint to the Director of Human Rights Proceedings. The director considers whether proceedings can be brought and if so will act for the plaintiff.

  • An individual can also initiate proceedings to the Human Rights Review Tribunal if the director does not consider the claim has substance. If the Tribunal believes there is an “interference with the privacy” of an individual it is able to grant a range of remedies. The Tribunal can award damages to an individual of up to $200,000. The highest award so far has been over $168,000.

  • If you are still dissatisfied, there is a general right of appeal to the High Court.

Privacy Act reform

The Law Commission has noted that while the complaints system is generally working well there are measures that could be incorporated to improve the efficiency and effectiveness of the system.

Proposed measures include removing the legal test of “interference of privacy” and replacing it with a simple breach of the Act. As it stands there may be cases with merit which are not getting through this filter.

It’s also proposed that the Privacy Commissioner be given power to determine complaints under principle 6 (access to personal information), with the Tribunal of Human Rights as an appeal body; and that the role of Director be removed.

We support any change that will streamline the complaints procedure and promote easy access for an individual to make a complaint and seek redress.

Enforcement

The current system is geared towards individual dispute resolution. It’s a reactive system, relying on the complaints process to enforce compliance with the principles. It’s effective for individual settlement but doesn’t address issues within a particular organisation or wider industry practice.

The Law Commission has proposed several reform options that would allow the Privacy Commissioner to take more proactive steps to ensure compliance within an organisation or wider industry.

Two key proposals were submitted:

  • Compulsory audits. A provisional proposal that the Privacy Commissioner be given mandatory audit powers. This would allow the Commissioner to be more proactive in promoting compliance with the Act rather than relying on the complaints process. It would also provide an incentive for agencies to maintain compliance. Priority would be given to areas such as the public sector, credit reporting and health information systems.

  • Enforcement notices. The Law Commission proposed allowing the Commissioner to issue binding enforcement notices. The Commissioner would identify a breach of the Act and then require the agency to comply.

In 1997 we suggested the Privacy Commissioner should have the power to make binding orders. We stand by this recommendation. We strongly support the proposal to grant compulsory audits and give more enforcement power to the Privacy Commissioner.

Direct marketing

The Privacy Act doesn’t provide any specific controls on direct marketing but the general principles will apply. In order for the Act to regulate direct marketing it partly hinges on whether the marketing approaches are based on the use of “personal information”.

It’s important to note that information such as a telephone number, physical address or an email address is not necessarily “personal information” unless it’s linked to other information in which an individual becomes identifiable. Marketing companies can also get around this by generic consent at the time personal information is collected.

The Act will not directly apply if information is publicly available or it was collected for marketing purposes.

Aside from the Privacy Act, the Marketing Association of New Zealand has developed a code of practice. This code established a “Do Not Call” register to which 44,000 people now belong. This register is said to decrease the number of unwanted, unsolicited phone calls that consumers receive from organisations. It is confined to direct marketers who are members of the Association. See our Telemarketing report for more information.

If you consider direct marketing is impacting on your informational privacy, contact the Office of the Privacy Commissioner and make a complaint.

Reform

The Law Commission has identified a range of proposals to address the issue of direct marketing and informational privacy. We support the call for a government-administered “Do Not Call” register. This would be more visible, proactive, and, importantly, independent of the marketing industry.

Data breach notification

A data breach is unauthorised access or use of personal information. Breach notification is the practice of notifying affected individuals when personal information has become available to unauthorised parties.

There have been some high profile data breaches.

  • The Treasury lost a CD in the post that contained personal and company tax details of numerous individuals.
  • The website of mobile phone company 2degrees suffered teething problems making it possible to see the personal details of previous visitors to its site.
  • Massey University’s intranet suffered a fault potentially exposing sensitive student information to anyone who accessed the site.

Data breach law

Holders of personal information are under no legal obligation to notify individuals or the Privacy Commissioner when an individual’s personal information is compromised. However, failure to notify would be taken into account by the Privacy Commissioner if a complaint was received.

There are strong arguments in support of making data breach notification mandatory. An individual who is notified will be able to take measures to ensure the negative effect of the breach is controlled or mitigated.

Information such as medical records and financial information is inherently sensitive. If people were notified of a breach they could take steps such as changing bank account details and passwords.

As notification is currently voluntary it makes it difficult to determine which firms and industries are the worst at protecting information. Mandatory notification would enable the collection of this type of data and allow areas of concern to be identified.

Voluntary notification may also act as a disincentive for organisations to notify individuals. By not contacting the affected individuals, organisations avoid exposure to liability, insurance consequences and damage to reputation.

Mandatory data breach notification would encourage organisations to increase the protection of personal information.

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