To protect against legal liability when monitoring your employees' work activities, consider the following:

1. Employee expectations. Before monitoring your employees, and certainly before disciplining your workers for misusing company property, it is important to evaluate company-wide privacy expectations. Consider whether there is a formal written policy on workplace privacy, how you have handled similar situations in the past, and whether or not it has been clearly communicated that the company may monitor employee use of the company's phone, email, and internet system. If clear expectations haven't been explicitly set, it's difficult to enforce a policy on the issue.
2. Draft a policy. Setting clear expectations starts with a well-written and well communicated policy relating to workplace privacy. To ensure employees are clear on exactly how company resources are to be used, some employers choose to draft separate policies pertaining to: computer use, internet use, telephone use, and electronic monitoring. When drafting such policies it is important to ensure they appropriately reflect the company's efforts to balance its "need to know" with an employee's right to privacy. As for the specifics, it is important to include the following: under what circumstances employees may be monitored, a specific list of what company resources are subject to monitoring (i.e., telephones, email, internet, etc), and that employees should not have any expectation of privacy.
3. Communicate company privacy policies. While drafting a workplace privacy policy and incorporating it into your employee handbook is important, it is virtually worthless if employees aren't aware of it. To ensure all employees understand what company resources are subject to monitoring and that privacy is not to be expected, reissue the policy periodically and have employees sign an acknowledgment form attesting to their knowledge and understanding of the policy. Additionally, post the policy in common areas such as employee breakrooms and on company bulletin boards and don't forget to provide all new hires with a copy.
4. Telephone use. Some states have strict requirements pertaining to the monitoring of telephone calls. For example, some regulations require that employers inform both parties that the call may be monitored prior to the start of the conversation. Other state laws require that the employer terminate the monitoring as soon as it becomes aware that the call is of personal nature.Employers choosing to monitor employee phone calls should ensure that there is a legitimate business reason for doing so, such as monitoring customer service representatives for quality assurance purposes. If you plan to monitor employee phone conversations, consider notifying employees in writing and having each employee sign a consent form. If you do monitor employee phone calls and hear that a conversation is private, hang up without listening to the contents of the call. Any personal information inadvertently obtained from a private conversation should be treated in strict confidence to avoid invasion of privacy charges.
5. Internet & email. Some employers allow their employees to use the internet or computer system for personal reasons within limits; others restrict such use entirely. It is important that employees know exactly what restrictions are in place with regards to the use of the company's internet and computer systems. This may include which websites are restricted, which are permitted, and at what times of the day employees can spend surfing the net - such as during break or meal periods.
6. Video surveillance. In some businesses, such as retail establishments and convenience stores, video surveillance may be a necessity. Employers using video surveillance should clearly state the reasons for its use, the circumstances in which tapes will be reviewed and how the information will be used. However, to avoid jeopardizing an employee's privacy rights, employers should provide employees with notice that they are being videotaped and only videotape in open or public areas in which there is a diminished or no expectation of privacy. Further, in accordance with the federal law, courts have held that an employer may not produce or secure a videotape that includes an audio component.
7. Workplace searches. Searches should only be conducted for legitimate business reasons, such as an investigation into the theft of company property. Prior to conducting a search it is important to ensure that employees are aware that workplace searches may occur and under what conditions. Searches must be non-discriminatory and as minimally intrusive as possible. If you have substantial and credible evidence suggesting employee criminal activity, contact the police and ask that they advise or assist in conducting necessary workplace searches.
8. Reasonable person standard. When determining whether violations in privacy have occurred, courts sometimes use the "reasonable person standard". This is used to measure whether a "reasonable person" would believe an intrusion to be highly offensive or without legitimate reason.
9. Be consistent. When implementing workplace privacy policies, it is imperative that they are applied consistently. Targeting a certain group or individual can easily become grounds for a discrimination claim. Ensure that all managers are properly trained on how to consistently apply the policy.
10. Know your state requirements. Although federal laws permit private employers to monitor their workers with little restrictions, state laws may vary. For example, some states require employers to post notices of workplace monitoring, others prohibit the monitoring of telephone calls, and most do not allow searches unless there is just cause. Don't forget to check your state laws pertaining to workplace privacy in the Privacy section of our State & Federal Laws.

Workplace monitoring can be a useful tool to help increase productivity and protect against the loss of company assets. However, it's important to be aware of the potential pitfalls, including legal liability and diminished employee morale, motivation, and trust if not properly used. Remember, in order to protect your business from liability, create and publicize a formal workplace privacy policy, apply the policy consistently, and always use caution when implementing it.