The Importance of Website Privacy Policies

June 21, 2024 by

Any website which collects personal information should have a privacy policy. A website privacy policy is a legally binding document linked on a website that explains the website operator’s practices concerning the collection, storage, use, and disclosure of information, including personal information, of its visitors. This sounds simple, but instead of a single law governing privacy policies, there are a myriad of applicable laws, varying from state by state (and country by country), which makes it difficult for business owners to comply, especially for those businesses which operate in multiple jurisdictions. Below is a very brief discussion of the considerations business owners should be aware of (and comply with) prior to maintaining an online presence.

The core issue a privacy policy addresses is the handling of personal information. In the same way that a client (not the attorney) owns the privilege in an attorney-client relationship, each individual owns his or her personal information (not a website that collects the information). When a business collects any individual’s personal information through its website, the business has a legal obligation to post a privacy policy to inform the individual in writing what information the business collects, why the business collects such information, and what the business does with that information. The choice is then up to the individual to use the website or not based on the published privacy policy.

The following are considerations to fully vet prior to drafting a privacy policy for your business:

  1. The functionalities contained in the website which can implicate credit card processing (PCI compliance), medical information processing (HIPAA compliance), any materials marketed towards minors (COPPA compliance), and other applicable laws;
  2. The audience of who is using the website and what country they’re from. This can bring about a host of applicable laws, which might include implications state-specific laws. For example, California has been at the forefront of privacy regulations for its citizens (CCPA/CPRA/CalOPPA) and many other states are following suit. It may also implicate international law. For example, the GDPR for EU citizens, PIPEDA for Canadian citizens, and DPA for UK citizens (among others);
  3. The information Different protections are needed depending on what information is actually collected by the website and where it is collected from. Keep in mind consistent with #2 above, that each jurisdication may treat protected information differently and the more sensitive the information, the more protections are required; and
  4. The handling of that information after collection. A business not only needs a reasonable rationale for what information it collects, but is also held to different standards depending on what the business actually does with the information and how it subsequently treats and transmits the information. For example, businesses who sell personally identifiable information to third parties are generally under more scrutiny and regulation than businesses who only use such information for internal purposes.

It’s imporant to note that no model privacy policy works for all or even most websites. Business owners must carefully draft website privacy policies to specifically reflect the business’ actual or anticipated information collection and privacy practices, and to navigate each of the above considerations, in addition to any applicable third-party requirements and other governing regulations.

Lastly, it is not enough for business owners to post a privacy policy and forget about it. The policy must be a living, breathing document that matures with an organization as its business needs change, and it must reflect the actual practices of the business.

If we can help you draft or update a privacy policy, or help you analyze laws that may apply to your situation, do not hesitate to reach out.

Joshua Mahaffey

Joshua Mahaffey brings a wealth of real-world, corporate experience to his client engagements. Prior to practicing law Mr. Mahaffey spent over twenty years in the transportation and logistics industry, with an emphasis on risk management. He often engaged and collaborated…Read More

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Adam Fox

Adam Fox co-founded Brown Fox and has emerged as a go-to confidant and wise counsel for business leadership, ranging from billion dollar companies to innovative start-ups.

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