The Inspector General (IG) at the Department of Labor is warning in a new report about serious equity and security concerns with the use of facial recognition software in unemployment insurance (UI) programs, and says that those concerns need to be addressed immediately.

In an alert memo released Tuesday, the IG said it’s “concerned that the use of identity verification service contractors may not result in equitable and secure access to UI benefits,” when processing claims. The agency watchdog is calling for extreme caution and more guidance to “ensure claimants are not subjected to discrimination by the use of facial recognition technology.”

Out of 53 state workforce agencies (SWAs) surveyed, 24 told the IG that they use an identity verification contractor that uses facial recognition technology. Two agencies did not respond to the survey from the watchdog.

Of the states using facial recognition tech, 90 percent of those told the agency watchdog that their contractors have helped reduce UI program fraud.

However, the agency IG remains concerned about access across demographics like race, gender, and privacy.

The IG explained that its concerns stem from a 2019 National Institute of Standards and Technology (NIST) Information Technology Laboratory report that found empirical evidence showing algorithms used in current facial recognition technology have a race and gender bias.

“The [Employment and Training Administration] has provided minimal guidance that specifically addresses facial recognition technology in administering UI benefits,” the IG’s memo says. “Without comprehensive guidance, SWAs are at risk of using technology that discriminates against claimants entitled to receive UI benefits and of not adequately safeguarding claimants’ [personal identifiable information].”

Brent Parton, acting assistant secretary at the Labor Department, said in a response included in the IG memo that the department will issue guidance requiring states “to provide at least one timely, effective, and accessible non-digital alternative to online ID verification” as recommended by the IG.

Parton also said that the department will emphasize to states that they need to identify and fix any problems with equitable access around identity verification. He also noted that existing regulations and guidance already require states to collect and study demographic data to look for any signs of discrimination.

Regarding security, the IG found that 63 percent of contracts between SWAs and identity verification service contractors did not include the privacy security measures recommended by the National Strategy for Trusted Identities in Cyberspace, which is necessary to protect UI claimants’ biometric data.

The Labor Department plans to issue more guidance with recommended provisions to put into those contracts, Parton wrote.

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Lisbeth Perez
Lisbeth Perez
Lisbeth Perez is a MeriTalk State and Local Staff Reporter covering the intersection of government and technology.