How to Screen Tenants Without Violating Canada’s Privacy Laws

by | Jun 18, 2018 | Tenant Screening

According to a recent news report, there has been a marked increase in the number of privacy complaints filed by tenants against landlords. One major issue centers around tenant screening.

Canadians landlords are subject to the requirements of the Personal Information Protection and Electronic Documents Act (PIPEDA). British Columbia, Alberta and Quebec have similar rules at the provincial level.

In response to the increase in complaints, the Office of the Privacy Commissioner of Canada (OPC) issued updated guidelines to clarify landlord rights and responsibilities under PIPEDA.

These guidelines recognize that landlords have a legitimate reason to collect private information on incoming tenants, including information necessary to verify identity, run a tenant credit check, and confirm rental history.

However, there are limits. For instance, consent to the tenant background check is crucial. Landlords must disclose the reasons why the information is necessary. That consent is generally contained in the declaration portion of the rental application, which is signed by the applicant.

The rental application should solicit only the information necessary to conduct the tenant background check and determine the applicant’s qualifications. One common complaint is the requirement that an applicant include a SIN. The OPC recommends that landlords make that disclosure optional, like when the person has a common name and the SIN can be used to ensure the landlord receives the correct tenant screening reports. The rental application should be tailored to the law. Asking too many inappropriate questions only aggravates tenants’ concerns and does little to reveal whether applicants are qualified.

Safeguarding tenants’ private information is equally important. The OPC recommends landlords not retain the most sensitive information — like copies of driver’s licences or pay stubs — to avoid unintended disclosure.

Other information should be kept under lock and key. Hard-copy files should be placed in locked cabinets away from public areas with keys not easily accessible. Digital files should be encrypted and access to devices must be limited. Sensitive data should not be stored on devices that frequently find their way into public places.

Tenant information should only be kept for as long as necessary for business purposes like potential legal liability or tax preparation. Speak with an attorney and accountant to determine how long to retain tenant information.

Once the information can be purged, do so responsibly — no recycling of private documents. Instead, those documents should be shredded or destroyed. When deleting digital files, remember to remove items from the device’s trash or back-up files.

Educate employees on the need to protect sensitive data. Avoid disclosure of information to contractors, vendors and family members who may have access to the leasing office or home office files or computers.

The OPC also recommends avoiding social media pages when running tenant background checks. That information is largely unreliable, it doesn’t take the place of tenant screening reports, and too often it reveals personal information that the landlord does not have the right to know.

Landlords must avoid blacklisting or otherwise publicly dissing specific tenants by revealing personal details online or around the community. However, the OPC acknowledges that there may be appropriate mechanisms for reporting bad tenants — to a credit bureau, for instance.

Overall, the best way to avoid privacy concerns is through good communication. Fortunately, this also is the best way to obtain the information needed for a successful tenant background check. Assure rental applicants that:

They are only required to reveal information specifically necessary for the tenant background check and to determine qualifications; and,

Their sensitive information will be closely guarded.

This post is provided by Tenant Verification Service, Inc., helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening, Tenant Background Checks, (U.S. and Canada), as well as Criminal Background Checks, and Eviction Reports (U.S. only).

Click Here to Receive Landlord Credit Reports.

Disclaimer: The information provided in this post is not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.

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