Workplace surveillance

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For as long as employment has existed, employees have been monitored. However, in recent years, with the proliferation of inexpensive devices to monitor a wider range of activities, workplace surveillance has become increasingly sophisticated and accessible, and as such is in far greater need of legislative review than ever before.

It is in this context that the New South Wales (NSW) Government released draft legislation in June 2004 which could create a precedent for managing workplace surveillance.

The Workplace Surveillance Bill 2004 (NSW) (the Bill), which applies to camera, computer and tracking surveillance of an employee ‘at work’ has been proposed to repeal and replace the Workplace Video Surveillance Act 1998 (NSW) (the Act).

Current workplace surveillance law

At present, while Victoria, Western Australia and the Northern Territory have legislation regulating video or visual surveillance of private activities, NSW is the only state that has legislation specifically covering surveillance within the workplace. “However, the existing NSW legislation on workplace surveillance is regarded by many as obsolete,” says Ms Fiona Inverarity, Partner at PricewaterhouseCoopers Legal and leader of the Employment Law group.

The Act prohibits all forms of video surveillance in change rooms, toilets, showers for example, and prohibits covert surveillance unless the employer has obtained a magistrate’s warrant.

‘Overt’ video surveillance, however, remains largely untouched by the Act. Other legislation relating to workplace surveillance is the Listening Devices Act 1984 (NSW). Under this legislation, it is an offence to use listening devices such as telephones to record or secretly listen to private conversations, including those involving employees, without consent.

Other legislation covering this area

The significance of the proposed Bill can be highlighted by the fact that there is currently no action for breach of privacy under Australian common law, and the application of other federal and state laws to the issue of workplace surveillance is limited. “There is no right to privacy at common law,” notes Ms Inverarity. The vast majority of employers currently validate their conduct by incorporating an express term allowing for workplace surveillance into the contract of employment.

In terms of federal acts regulating workplace surveillance, it is doubtful that the Telecommunications (Interception) Act 1979 (Cth) prohibits email monitoring, and contrary to popular belief the Privacy Act 1988 (Cth) allows only limited protection to workers because of exemptions relating to “small businesses” and “employee records” (although the latter exemption is under review).

The area of unfair dismissals also indirectly regulates workplace surveillance, in that the dismissal of an employee based purely on evidence gathered through workplace surveillance will be unfair unless the employer has in place a clear and effective workplace surveillance policy. This was demonstrated recently when the Australian Industrial Relations Commission (AIRC) upheld the dismissal of an employee who used the company email system to ask a fellow colleague for drugs. Because the company had a clear workplace surveillance policy in place, they were allowed to use the email as evidence of misconduct.

Objectives of the Bill

The objectives of the Bill are to:

• prohibit employer surveillance of employees at work except when the employee has been notified of the existence, type and duration of the surveillance or when the surveillance is carried out under a covert surveillance authority for the purpose of establishing whether an employee is involved in any unlawful activity at work,

• restrict employers blocking emails and internet access of employees at work,

• provide for the issue of covert surveillance authorities by Magistrates subject to conditions being adhered to, and

• restrict the use and disclosure of covert surveillance records.

Definitions of covert and notified surveillance

The Bill makes a distinction between covert and notified surveillance. Notified surveillance requires that employees be notified in writing of the intended surveillance at least fourteen days before the intended surveillance (cl 5(2)(b)). A shorter period is possible with the agreement of the employee.

“Covert surveillance on the other hand, is defined as surveillance that is not notified,” explains Ms Inverarity. The Bill makes it an offence for an employer to carry out covert surveillance of an employee at work unless the surveillance is carried out solely for the purpose of establishing whether the employee is involved in any unlawful activity at work (cl 8(1)(a)) and the employer has obtained a covert surveillance authority from a Magistrate (cl 8(1)(b)).

Three types of surveillance

The Bill proposes to extend the Act from solely regulating camera surveillance to include tracking and computer surveillance (cl 3).

Camera surveillance, which is included currently under the Act, can only be used where the employee has been given the required notice, the cameras are clearly visible, and signs are present to notify people that they may be under surveillance (cl 5(2)(a)).

Tracking surveillance of an employee is defined in the Bill as ‘the monitoring or recording of the geographical location or movement of the employee by means of an electronic device’, for example, tracking an employee or any vehicle driven by an employee by means of a global positioning system tracking device. Tracking surveillance can also only be used where notice is given in advance by means of a clearly visible sign on the tracked device (cl 5(d)).

Computer surveillance is the ‘monitoring or recording by means of software or other equipment of the information input or output, or other use of a computer used by an employee’. This includes the sending and receipt of emails and the accessing of internet websites. As with the other types of surveillance, computer surveillance can only be used where the employee is given the required notice of the surveillance either by written notice clearly visible on or in the vicinity of the computer concerned, or by audible announcement or written notice (when the employee logs on to the computer concerned) or starts a program that is the subject of the surveillance (cl 5).

The Bill also prohibits employers from preventing or restricting email delivery or website access – including emails or websites which contain information about industrial or union matters (cl 11(4)). An exemption exists, how-ever, for employers who have an internet and email policy which covers the restrictions, and whose employees have been notified of the policy. In the case of a blocked email, the employee must receive immediate notice that the delivery of an email has been prevented (cl 11(1)(b)), unless:

• the email falls within the Spam Act 2003 (Cth),

• the delivery of the email will result in a person being menaced or harassed, or the content of the email or attachment would be regarded by a reasonable person as being offensive.

Arguments for workplace surveillance

Employers argue that they have a right to protect their property and themselves from security risks, and that surveillance is justified on the basis that it minimises the risk of theft and damage to property or persons.

Further, surveillance can reduce an employer’s exposure to liability risks like wrongful employee conduct (such as computer hacking), accidents in the workplace or workplace discrimination. In the recent case of Williams v Centrelink (2004), the AIRC upheld the dismissal of an employee who was found to be sending pornographic e-mails to a female staff member. Without surveillance, the conduct would not have been discovered and Centrelink may have been held vicariously liable for the sexual harassment of the female employee.

“Employers also argue that surveillance can be used as a means of increasing productivity in the workplace,” says Ms Inverarity. “For instance, devices that record key stroke rate or the number of phone calls taken can be used to determine worker efficiency.”

Further, workplace costs that result from employees downloading irrelevant material from the internet, making non-work phone calls, and taking resources for non-work purposes can also be reduced through workplace surveillance.

Arguments against surveillance

An argument put forward by The NSW Council for Civil Liberties is that workplace surveillance is simply an invasion of employee privacy.

Further, workplace surveillance can put a strain on the employment relationship. Surveillance which monitors efficiency has been shown to result in increased stress, lower morale and resentment. It may also erode any mutual trust between employer and employee and create suspicion and tension in the workplace. This can potentially lead to increased industrial disputes, greater hostility and a less effective workforce.

Finally, with employees working significantly longer hours than previously, it is argued that employees should be allowed to privately interact with the outside world. For example, where employees work through lunch breaks they should be allowed to use work facilities to undertake daily tasks such as internet banking or shopping.

Views of stakeholders on the proposed increase in regulation

The State Chamber of Commerce argues the proposed legislation is an unnecessary and costly imposition on business. They believe it will disadvantage businesses operating across state borders as they will be required to implement a different workplace surveillance policy in NSW. They also argue that small to medium size businesses may be burdened with the cost of engaging information technology professionals to meet the notification requirements under the Bill.

In contrast, the Australian Workers Union (AWU) have welcomed the Bill and have announced that they will be pushing for similar reforms in other States and Territories. The AWU are also currently working on a workplace surveillance protocol that they hope will eventually be included in Industrial Awards and Enterprise Agreements.

A third view, put forward by The Council for Civil Liberties, is that the proposed legislation does not go far enough. The Council argue that because there is no requirement that employees consent to surveillance (only that they be notified) employers could still use workplace surveillance to abuse or undermine the employer/employee relationship by invading worker privacy and dignity.

Potential problems with the draft Bill

A significant problem with the Bill in its proposed form is its definition of ‘workplace’. ‘At work’ is defined broadly to mean ‘at a workplace, or at any other place while working’. This definition is ambiguous. For example, under this definition it is not clear what rights an employer would have to monitor the use of business owned infrastructure (such as laptops) that are used in the home for both personal and work purposes.

Changes employers would need to make should the Bill become legislation

It is important for employers to note that the proposed legislation only places a requirement on employers to notify their employees of workplace surveillance.

“Employees are not required to consent to surveillance and employers are not prevented from gaining access to such things as employee e-mails and internet sites, once notification has been given,” says Ms Inverarity. The Bill also does not curtail an employer’s existing right to screen spam or monitor offensive e-mails.

The proposed legislation is unlikely to be of major concern to the many employers who already have e-mail/internet policies in place. “Employers who do not have such policies would need to implement a policy regarding notification of workplace surveillance in accordance with the guidelines for each type of surveillance,” suggests Ms Inverarity. If employers utilise workplace surveillance in a manner which is not in accordance with the proposed Bill (should it become legislation), an offence will be committed with a maximum penalty of $5,500.

In essence, the Bill attempts to provide some guidance in what is a highly unregulated area, ensuring that workplace surveillance can be carried out ethically and responsibly. It requires employers who utilise workplace surveillance to acknowledge that their employees have the right to a reasonable degree of privacy.

For more information please contact:

Fiona Inverarity Tel: +612 8266 6602 Fax: +612 8266 6999 Send email

Fiona Inverarity, Leader Fiona provides her clients with high level strategic advice on all aspects of employee relations. She has extensive litigation experience and has run many of the leading case in the Anti-Discrimination Tribunal and Federal Court. Fiona has an excellent grasp of business issues facing her clients, good working relationships with various trade unions and the ability to quickly and accurately analyse situations and develop innovative solutions. She enjoys working with human resource professionals and the ability to bring more than just a legal answer to complex issues.