Contact:
Steven B. Harz, Esq., Chairman
Holly C. Peterson, Esq., Associate
Labor & Employment Law Group
201-342-6000
NEW JERSEY APPELLATE
COURT HOLDS THAT EMPLOYERS HAVE A DUTY TO MONITOR AND PROMPTLY
INVESTIGATE EMPLOYEE’S ACTIVITIES ON WORKPLACE COMPUTER FOR POSSIBLE
WRONGDOING
Dear Clients and Friends:
On December 27, 2005, the Appellate Division of the Superior
Court of New Jersey issued a major decision holding that an employer
who is put on notice that one
of its employees is using a workplace computer to access pornography
has a duty
to monitor and investigate the employee’s activities and to take
prompt and
effective action to stop the unauthorized activity which could
result in harm to
innocent third parties. The Court’s decision in Doe v. XYC
Corporation held that
an employee has no privacy interest which stands in the way of an
employer’s
duty to monitor, investigate and enforce the employer’s formal
policy regarding
use of its workplace computers by its employees
The employee worked as an accountant for XYC Corporation (“XYC”)
which employed
approximately 250 employees. Sometime in 1998 or 1999, XYC’s
Internet Services
Manager advised the XYC Network Administrator that a review of
computer logs
showed that the employee had been visiting pornographic websites.
XYC’s Internet
Services Manager advised the employee to stop the activity but did
not advise
the management of XYC. Despite the fact that XYC had a formal policy
in place
and that numerous employees put XYC on notice of the employee’s
accessing and
viewing pornographic websites from his workplace computer in his
cubicle from
1999 through 2001, XYC did not monitor or investigate the employee’s
actions on
the workplace computer because of a fear that the employee’s privacy
interests
trumped XYC’s right to monitor.
Prior to this case, no court in New Jersey ever addressed the
issue of whether
an employer has the duty to investigate and take prompt action when
the employer
is placed on notice that an employee is utilizing workplace
computers for
possible unlawful actions. The Appellate Division made it clear that
an
employer’s duty to monitor the employee’s use of his workplace
computer in the
context of civil litigation brought by a third party claiming injury
resulting
from those computer activities outweighs any alleged privacy
interest on behalf
of the employee. The Court looked positively on the fact that XYC
had a proper
formal policy in place which advised all employees that the employer
has the
right to monitor all information, e-mails and documents prepared,
viewed or
accessed on the workplace computer system. However, the Court
determined that
under the facts of the case, the employer failed to promptly
investigate and
determine if, according to the policy, the offending employee needed
to be
disciplined.
The Appellate Division emphatically held that (1) an
employee has no legitimate expectation of privacy that would prevent
the
employer from accessing the employee’s computer to determine if the
employee was
using the workplace computer to view pornography when the employer
has a formal
policy in place, (2) when an employer is put on notice of an
employee’s possible
unlawful activities, the employer is under a duty to promptly and
effectively
investigate such activities, and (3) with actual or imputed
knowledge that an
employee is viewing pornography on the employer’s computer, the
employer is
under a duty to act either by terminating the employee or reporting
the
employee’s activities to law enforcement authorities, or both.
In light of this case, employers face an increasing burden
relative to
monitoring its workplace computer systems. Employers should
establish a formal
policy which expressly provides that all information composed, sent,
received or
accessed on the workplace computer system remains the property of
the employer
and that the employer reserves the right to review, access and
disclose all such
information it deems necessary and at the employer’s sole
discretion, The
employer also is under a duty to enforce such policy by monitoring
employees’
actions when the employer is put on notice of possible violation of
such policy.
If you have any questions with regard to the application of this
case to your
Company or with respect to any other labor and employment law
matter, please do
not hesitate to contact Steven Harz, Esq,
at (201)
342-6000, or via email at sharz@hertenburstein.com.
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