From the October 1997 issue of Entrepreneur

When you provide employees with e-mail, you facilitate more than productivity, camaraderie and efficient communication. You also provide them with an easy way to disparage or harass their coworkers, disseminate tasteless humor, and reveal company secrets to your competitors. E-mail messages have become a gold mine of evidence in lawsuits over charges such as sexual harassment because deleted messages can often be recovered.

Given the risk, you need to be aware of the types of messages that are floating around on your e-mail system. Employees often believe their messages are as private as personal letters sent through the U.S. mail. Indeed, some employees have sued their employers for reading their e-mail, claiming a violation of privacy. While courts so far have sided with the employers, it's best to remind employees routinely that their e-mail messages are subject to company scrutiny.

Illusion Of Privacy

The problem, says Bloomfield Hills, Michigan, attorney Johanna Armstrong, is that e-mail instills a deceptive sense of privacy. An employee sits down at a computer terminal with no one watching, types a message and sends it with a click of the mouse. The recipient uses a password to access the system and reads the message in the seclusion of his or her cubicle. It feels a lot like reading a letter sent through the mail, a method protected by federal law from unauthorized tampering.

"What employees don't understand," Armstrong says, "is that e-mail is not at all like the U.S. mail but is more akin to posting a message on a public bulletin board for all to read." Messages intended for one co-worker can mistakenly be broadcast to everyone in the office. Messages people thought they deleted can be retrieved and used against the company in court.

For the protection of your employees as well as your business, establish a policy restricting your e-mail system to work-related matters. "A good e-mail policy not only confirms the corporate e-mail system is for business use only," Armstrong says, "but also dispels the deceptive aura of privacy."

While there's no harm in an occasional friendly note, office e-mail has often taken a nasty turn. Disgruntled employees have sent messages purportedly from corporate officers, announcing new company policies. Others have downloaded trade secrets and sent them to competitors or used e-mail to defame co-workers. The anonymity of e-mail allows employees to disseminate racial slurs, send sexually explicit messages, or even set up a distribution system for illegal drugs.

To avoid abuses and keep tabs on what's circulating through your office, you need to be able to monitor e-mail. This doesn't mean reading every message. In fact, says Kenneth R. Shear, general counsel for Electronic Evidence Discovery in Seattle, it's better not to be too thorough. "You don't want to take on the role of system monitor," Shear says, explaining that employees might then hold you responsible for not discovering such problems as sexual harassment conducted through e-mail. Shear advises asking employees to notify their supervisor if they see something offensive in an e-mail message. For general monitoring, available software can check, for instance, if there are a lot of graphics on your system when your company doesn't deal with graphics. You might also use key-word searches to check for inappropriate messages.

A Losing Battle

The problem for employers is that an increasing number of employees, believing that even in-house e-mail should be for their eyes only, are suing employers for violating their privacy. For instance, a regional operations manager for a major food company sometimes communicated with his supervisor from home through the company's e-mail system. Some of his messages were, in the company's view, inappropriate and unprofessional--to the extent that they led to his termination. The employee sued, noting that he had relied on assurances from the company that e-mail would be confidential and would not be intercepted and used against him.

The U.S. District Court for the Eastern District of Pennsylvania dismissed the lawsuit. The judges explained that an employee cannot reasonably expect messages on the company e-mail system to be private, even if the company says they will be. Moreover, the court ruled, "the company's interest in preventing inappropriate and unprofessional comments or even illegal activity over its e-mail system outweighs any privacy interest the employee may have in those comments."

Other courts have reached similar conclusions. Even in California, which recognizes especially strong privacy rights, employees have not succeeded in proving such claims. "The courts appear to be heading toward allowing companies to monitor e-mail," Shear says. That's only common sense, he adds, because "how can you do business if you don't have access to your own system?" (Although the Electronic Communications Privacy Act forbids the intentional interception of electronic communications, reading what's on your own company's system normally doesn't count as an interception--although reading correspondence to an employee from outside the company might.)

Fair Warning

Employees who understand that their e-mail might be monitored will, if they value their jobs, be less likely to use it inappropriately. Begin with an official policy stating that company e-mail is for business use, not personal, and that e-mail messages are subject to random monitoring. In a memo or training session, explain the reasons for the policy. You can even give your employees a daily reminder by having a statement of the policy appear on the screen every time they log on to their computer. If they've just been reminded that their boss might read their e-mail, they'll be less likely to send out inappropriate messages.

The law in this area is murky enough that e-mail could be construed as the equivalent of a telephone conversation, and some states require permission before listening to an employee's phone conversation. Accordingly, Shear advises obtaining employees' consent to monitor their e-mail every time they log on to the system. At the end of the on-screen policy reminder, inform employees that by proceeding to use the system, they've given their consent to have their messages monitored. Those who want privacy--to the degree it's obtainable for electronic communication--can sign up for e-mail at home.

Contact Sources

Dickinson, Wright, Moon, Van Dusen & Freeman, 525 N. Woodward Ave., #2000, Bloomfield Hills, MI 48304, (810) 433-7200, ext. 7554

Electronic Evidence Discovery Inc., 1215 Fourth Ave., #1420, Seattle, WA 98161, shear@eedinc.com

Steven C. Bahls, dean of Capital University Law School in Columbus, Ohio, teaches entrepreneurship law. Freelance writer Jane Easter Bahls specializes in business and legal topics.