 |
Thelen Reid Brown Raysman & Steiner LLP
Introduction
Because the information superhighway has knocked down
the physical walls that once reliably protected confidential,
proprietary and trade secret information, employers doing
business today need much more than a policy prohibiting scandalous
e-mail - they need a comprehensive "information policy."
Such policies are also required because there are major differences
between the way persons use e-mail as opposed to the "old"
ways of letters and memoranda. E-mail authors are often
less formal - and less sensitive to others - in e-mail communications
than in traditional paper or face to face communications.
Data transmitted in informal e-mails have already been critical
evidence in major litigation - including in the Microsoft
antitrust litigation.
In an effort to avoid potential liability from unrestricted e-mail and Internet use in the workplace, many employers have adopted policies that purportedly restrict employee use to solely business purposes. Such a restrictive policy theoretically prevents use of e-mail to create a hostile work environment or organize a union. But how many employers who adopt this policy actually enforce it? Inconsistent enforcement of a "business-use only" policy begs litigation alleging disparate treatment. See, e.g., Miller v. U.S.F. & G., 65 F.E.P. Cas. (BNA) 593 (D. Md. 1994).
Numerous other legal issues must also be considered in designing both software systems and electronic information policies besides simply whether e-mail and Internet use is permitted for non-business purposes. This is particularly true as employers allow employees to use home machines for purposes of telecommuting. The following is just a brief list of some of the challenging issues facing employers who are striving to develop workable information policies.
Record-Keeping and Retention
This could be the most critical issue facing employers who are integrating e-mail and Internet usage into their day-to-day business operations. E-mail and intranet postings are now frequently used by employers to distribute notices required by law, such as policies against unlawful harassment and benefits plan documents. However, the same laws that require distribution of these notices also require that employers prove the receipt of these documents by employees, typically not a difficult task given that most popular office communication suites utilize e-mail programs that utilize some sort of "return receipt" utility. The posting of such notices on an intranet presents more of a problem in this regard, one that must be considered and addressed by an employer prior to using Web postings for these purposes. Employers must devise workable methods to save records of both receipt of the policy and the policy itself for all periods required by law. For example, when a policy posted on an intranet is replaced by a new version, a hard copy of the former policy should be retained.
Another common use for e-mail or an intranet is to communicate requests for vacation, family leave, training, disability accommodations, promotion or transfer, adjustments in compensation, and to communicate management approval or denial of such requests. These items are typically considered personnel records and need to be retained under federal law, as well as under the laws of many states, including California.
For example, EEOC regulations interpreting Title VII the Civil Rights Act of 1964 require that: any personnel record made or kept by an employer (including, but not limited to requests for reasonable accommodation, application forms submitted by applicants and other records having to do with hiring, promotion, demotion, transfer lay-off or termination, rates of pay or other terms of compensation or selection for training or apprenticeship) shall be preserved by the employer for a period of one year from the date of the making of the record or the personnel action involved, whichever occurs later. 29 C.F.R. §1602.14.
Employers instituting "scrubbing" or deletion procedures to preserve room on servers or on individual hard drives must be cautious to ensure that records of distribution and receipt of certain documents are maintained as required by law, as well as a copy of such documents. While printing out such documents is the most obvious method of doing this, most employers justifiably chafe at this - after all, minimization of such "paperwork" is the justification for the use of such network systems. With the assistance of system designers and competent counsel, employers can devise an easily accessible and searchable media to ensure compliance with statutes regarding record retention.
Another evolving use for e-mail is tracking work hours. Some employers have found that where employees use e-mail to clock in and out, there is potential for fraudulent time entries. Wallace v. Brown, Equal Employment Opportunity Comm'n Appeal 01940721, Agency Number 92-1819, 1994 EEOPub Lexis 1751 (1994) (employee allegedly gave password to friend to enable friend to log-out for her). To ensure accurate computer-generated records, an employer should also strictly enforce a policy prohibiting employees from sharing passwords. If e-mail is used for time-keeping purposes, employers must also maintain electronic records for all applicable periods required by law as described above.
The Evolving Use of Electronic Evidence
Employers should also draft e-mail retention policies with an awareness of how e-mail may be used in litigation. Electronic mail has proven to be valuable (or devastating) evidence in discrimination cases, as well as cases alleging the existence of employment contracts.
It is becoming abundantly clear that employees tend to use
electronic mail far differently than they would utilize paper
communications such as letters or memoranda in the work place.
The popularity of electronic mail largely results from its
dual nature of being as efficient and informal as a spoken
conversation with the permanence of a written letter or memorandum.
Unfortunately, this informality often is accompanied by inappropriateness.
Employers should warn supervisors and employees to use the
same care in drafting e-mail messages that they would in drafting
a letter or memorandum. Furthermore, they should be
adamant that their electronic mail may be monitored by supervisory
personnel. Employees must understand that e-mail frequently
lasts longer than messages that are sent to individuals on
paper, and is far more easily forwarded to other (unintended)
users both within the company and outside the company.
Informal communications between supervisors and employees have allowed courts to conclude that an employer made an offer of an employment contract where none was made, or worse, that an employer's reasons for an adverse employment decision were a pretext for discrimination. See, e.g., Wilson-Simmons v. Lake County Sheriff's Dept., 982 F. Supp. 496 (N.D. Ohio 1997) (racist e-mail used to illustrate pretext); Harley v. McCoach, 928 F. Supp. 533 (E.D. Pa. 1996) (racist e-mail used to supply evidence of hostile work environment).
Similarly, well-crafted e-mails have been used to buttress claims that an employment decision was based on legitimate, nondiscriminatory concerns. Greenslade v. Chicago Sun-Times, 112 F.3d 853 (7th Cir. 1997) (e-mail messages confirmed plaintiff engaged in behavior warranting transfer).
Evidentiary use of e-mails will undeniably increase. Employers should therefore consider a uniform scrubbing policy that applies to all e-mails not required to be maintained by law. In initiating any such scrubbing policy, employers should be cautious not to engage in any conduct that may constitute spoliation of evidence in active litigation.
Prohibiting Harassment, Threats or Intimidation
Many employers already have policies prohibiting messages that may constitute unlawful harassment. However, the dangers of such e-mail can never be underestimated. In a recently settled case, Owens v. Morgan Stanley & Co. Inc., 96-9747 (S.D.N.Y. Dec. 30, 1996), several employees alleged that wide distribution of a racist e-mail message, and the company's failure to discipline employees involved in disseminating the message, evidenced a hostile work environment. Employers should also be aware that the provision of Web browsers on employee computers could also create liability for hostile or work environment actions under state and federal discrimination laws. Although this issue has not been litigated in reported decisions to date, it is certainly plausible that an employee could allege that the apparent viewing of sexually explicit Web sites by other employees could constitute a hostile work environment.
One unscientific poll of 9,000 Internet users by MSNBC revealed that:
- almost one in five persons visited cybersex sites while at work;
- roughly 8% spent 11+ hours a week in cybersex activities;
- almost three of four respondents indicated keeping secret from others how much time they spend online for sexual pursuits.
ZDNET
Anchor Desk, Annette Hamilton (06/10/98). Therefore,
employers may wish to consider the use of widely available
utilities which can prevent employers from viewing scandalous
Web pages on the employer's computers.
Electronic Complaints Procedures
Employees who wish to complain about the company's practices
or raise safety concerns can easily do so by e-mail.
Employers must cautiously consider how, and what types of,
complaints should be raised by e-mail. For example,
an employer may state as part of its information policy
that employees cannot make anonymous complaints using corporate
e-mail.
An employer also may wish to encourage complaints of a highly
personal or confidential nature, such as complaints of harassment
be made in person to a member of management, as such complaints
require immediate attention and extreme confidentiality.
However, use of online complaint procedures that provide
adequate protection for privacy can assist an employer with
its burden of responding immediately and appropriately to
complaints of sexual harassment.
The Electronic Union
At least one employer has been found by the National
Labor Relations Board ("NLRB") to have violated
the National Labor Relations Act by promulgating a policy
that prohibited organizing activity on its e-mail system.
In E. I. du Pont de Nemours & Co., 311 N.L.R.B.
893 (1993), the Board held that an employer violated the
act by barring employees from using e-mail to distribute
union literature and notices, while allowing employees to
frequently use e-mail to send messages to each other on
other non-work related topics.
The NLRB has not taken a clear position on exactly how e-mail
use may be restricted to prevent organizing activity without
running afoul of the National Labor Relations Act.
Existing law was developed in the late 1940s - when solicitation
was done by interpersonal communication and leaflets.
This precedent allows employers to restrict union organizing
solicitation done on "working time" in "working
areas."
The unsettled state of this precedent is a clear example
of how changes in information technology will challenge
lawmakers in the future. The law allowing employers
to prohibit such solicitation in working areas has its basis
in the concept that such solicitations create litter around
the workplace. Obviously, e-mail messages do not present
the same problem. Therefore, a literal interpretation
of this precedent might indicate that e-mail would be exempt
from the organizing restrictions that exist with respect
to paper solicitations. On the other hand, this precedent
applies equally to oral solicitations, and oral solicitations
have always been subject to restriction during working time
and in working areas as well. Some scholars have argued
that the use of e-mail is different, and arguably a greater
intrusion than oral or written solicitations because the
processing of e-mail results in expense to the employer
in the form of the purchase of hardware and software and
the use of employee time.
Employers should also be aware that unions are typically
now utilizing e-mail and the Internet as methods to post
information about new organizing campaigns and even strikes.
During the most recent Northwest Airlines strike, the union
created its own Web site to update employees nationwide
on the state of negotiations between the union and the airline.
In Washington, a large cadre of high-tech temporary employees
has formed an "electronic union" - WashTech.
The Web also critically assisted one union success in organizing
several Borders bookstores.
Shared Systems Without Sharing Liability
Employers in today's workplace are also faced with use
of company e-mail systems by contractors and temporary employees.
Employers operating shared systems should review their policies
to avoid claims under the Electronic Communications Privacy
Act, 18 U.S.C. Section 2701, et seq.
In Andersen Consulting LLP v. UOP, 1998 U.S. Dist.
Lexis 1016 (N.D. Ill. 1998), Andersen attempted to sue a
former client, UOP, regarding distribution of the content
of Andersen's e-mails to the media after their relationship
had gone sour. The court rejected Andersen's ECPA claims,
stating only distribution or knowing divulgence of the contents
of electronic communications by a service that provides
electronic communications services to the public would violate
the ECPA.
However, as there is little case law interpreting the work
"public" as used in the ECPA, employers should
make clear statements to contractors and temporary employees
that they have no expectation of privacy or any property
interest in their e-mail messages on the shared system.
Protecting Copyrights and Trademarks
Existing copyright laws apply to materials obtained
from the Internet and through e-mail. See, e.g., Religious
Technology Center v. Lerma, 1996 U.S. Dist. Lexis 15454
(E.D. Va. 1996). It is foreseeable that employees will republish
copyrighted material obtained either through corporate subscriptions
to online publications, or through personal subscriptions
to online publications.
Under both traditional agency principles and as a "publisher"
(the owner of the e-mail system), it is possible that such
republication may lead to liability under federal copyright
law. Employers should accordingly consider prohibiting
employees from subscribing to any copyrighted material for
nonbusiness purposes, and warn employees of the potential
damages arising from violations of copyright law.
Employers also should be cautious to warn employees not
to use the trademarks of the employer or other employers
without authorization. Unauthorized use of a trademark
could result in claims for disparagement of the mark, as
well as claims for unauthorized use. See Patmont
Motor Werks v. Gateway Marine, 1997 U.S. Dist. Lexis
20877 (N.D. Cal. 1997).
Balancing Employee Privacy Against Avoiding Liability
Given the unknown scope of potential employer liability
for trademark and copyright violations, as well as for harassment
and discrimination, employers should consider the implementation
of monitoring policies. Such policies, however, illustrate
the conflicting legal obligations imposed on employers.
Consistent employer monitoring of e-mail risks either a
jury finding that the employer exercises sufficient control
over an e-mail misuse, or an invasion of privacy claim by
employees. On the other hand, failure to monitor e-mail
systems raises an equally unattractive risk of third-party
suits for negligent supervision.
To avoid claims of invasion of privacy arising from monitoring,
employers must make clear that the e-mail system or Internet
gateway is company property, that monitoring will occur
and that employees should not have any expectation of privacy
in e-mail messages or Internet use on company systems.
Employers should also be aware that simple and inexpensive
encryption software is widely available. Software
such as Pretty Good Privacy ("PGP"), allows individual
users to encode e-mail messages to other external or internal
users in such a way to render them virtually indecipherable
to anyone except the intended recipient of the message.
Even if the employer had its own copy of the software being
used, without the encryption key used by the sender, the
message would still be indecipherable. Under no circumstances
should an employer allow employees to utilize programs such
as PGP without its consent, for the obvious reason that
it will not be allowed to monitor the correspondence that
is being created by, and distributed through its network.
With the proper policies and disclaimers, employers can
make clear that employees have no reasonable expectation
of privacy on company systems. However, what about
disparaging postings on Internet billboards from personal
or home systems? In these situations, absent disclosure
of confidential information or a breach of a fiduciary duty,
employers act against an employee at their peril.
Further, attempts to track down the identify of such individuals
may likely be unlawful.
The Perils of Telecommuting
Advances in modem technologies in addition to the decrease
in prices in personal computers have allowed many employees
to construct home offices relatively inexpensively. These
technologies, combined with cellular phones and facsimile
machines, often allow individuals in many fields to do their
work from home as capably in many respects as they could
in the office. Many employers find that telecommuting
can also have its advantages in terms of the reduced overhead
costs generally associated with maintaining office space
for employees. Telecommuting, however, creates several concerns
in the employment context.
First, an employer must consider how it determines and records
the hours of work for telecommuting employees who are not
exempt from overtime. Employers usually must record
these employees hours of work ensure that breaks are taken,
and monitor whether overtime liability is incurred.
Clearly an employer would have a difficult time performing
these tasks with respect to employees that are not being
constantly supervised. Therefore, employers must devise
a consistent scheme for dealing with all of these issues,
ensure that employees are informed of the scheme, and ensure
that such a plan will have the approval of state or federal
wage and hour agencies.
It is also foreseeable that the use of telecommuting employees
could create some problems in resolving the issue of whether
particular individuals are an independent contractor or
an employee for tax and other purposes. Typically,
courts examine a number of factors in determining whether
an employer has the right to control the method and manner
used to achieve certain results by an individual.
If the employer has the right to control the work, the individual
is usually determined to be an employee of the employer;
if not, the employee is typically an independent contractor.
Clearly, telecommuting can change the control an employer
has over an employee, and therefore alter the employee/independent
contractor analysis in unanticipated ways.
Finally, several cases arising under the American With Disabilities
Act ("ADA") have also raised the issue of whether
an employer must allow an employee to telecommute as a reasonable
accommodation for a disability. Most of these cases
focus on the issue of whether presence at the workplace
is an essential function of a particular job. Several
U.S. Courts of Appeals dealing with the issue have ruled
that presence on the job is an essential function of the
employment under the facts presented to it, and therefore
telecommuting was not a reasonable accommodation.
In Vande Zande v. Wisconsin, 44 F.3d 538 (7th Cir.
1995) the U. S. Court of Appeals for the Seventh Circuit
accepted the employer's argument that the positions sought
to be converted to telecommuting ones required teamwork
and required the presence of an employee at the job site
to prevent a decrease in productivity. However, other
courts have examined this issue and have refused to adopt
a presumption that telecommuters are not as productive as
their in-office counterparts because of a lack of teamwork.
In general, it is difficult to conceive of any court setting
forth a conclusive analysis that would deal with any such
request regardless of its facts. In fact, under the
ADA, employees may now claim they are entitled to ergonomic
equipment at their home office at the employer's expense.
Unfortunately, absent legislative guidance, employers facing
ADA issues regarding telecommuting will likely be forced
to address requests on a case by case basis.
If you would like to receive legal reports and updates more quickly, by e-mail, click here and fill out the mailing list form.
For more information about the issues covered in this report, please contact Linda S. Husar in our Los Angeles office at 213-576-8017 or at lshusar@thelen.com or contact your Thelen attorney. For more information about Thelen's Construction and Government Contracts Department, click here.
©1998 Thelen Reid Brown Raysman & Steiner LLP
|
