The bipartisan proposal comes after reports that some firms have required passwords as a condition of employment, or that schools have asked for the information to guarantee enrollment or participation in sports programs.
The lawmakers said the bill, a reintroduction of a measure proposed last year, was aimed at protecting privacy in social networks like Facebook or Twitter.
"The lack of clarity in the law puts individuals in a position where they either have to give up vital, private information, or risk losing their job, potential job, or enrollment in school and involvement in the school's sports programs," said Representative Eliot Engel, one of the bill's sponsors.
"Frankly, when there are no laws prohibiting institutions from requiring this information, it becomes a common practice."
The proposed Social Networking Online Protection Act would protect people already employed or enrolled, those seeking employment or admittance, and those facing disciplinary action, from being required to disclose their passwords.
The lawmakers said six states California, Delaware, Illinois, Maryland, Michigan and New Jersey have already enacted similar legislation, but argued that a federal bill is needed.
"Asking for someone's password is like asking for a key to their home," said Representative Jan Schakowsky, another sponsor.
"Privacy is a basic right that all Americans share, and one that we should act to protect; this legislation sets boundaries," she said.
"No one seeking an educational or job opportunity should have to worry that their personal password information will be required as a condition of enrollment or employment."
Engle, from New York, and Schakowsky, from Illinois, were joined by Representatives Michael Grimm and Paul Tonko of New York, Keith Ellison of Minnesota and Chellie Pingree of Maine.
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