A new Littler Mendelson survey of in-house attorneys and corporate leaders found two-thirds were concerned about the technologies’ impact on employee morale and compliance with privacy laws.
From keystroke loggers to screenshot-capturing software and webcam eye-trackers, employee-monitoring tools have been on the rise since the COVID-19 pandemic drove white collar workers out of their cubicles and into home offices.
But a new survey from Littler Mendelson found a deep divide among employers on whether the technologies are a good idea. The survey of 515 in-house lawyers, C-suite executives and HR professionals in the U.S. found 45% of companies are using them, but 41% are not and aren’t considering doing so. Twelve percent are considering adoption, and 1% have made the decision to adopt but haven’t yet done so.
Sixty-five percent of respondents expressed concern about the technologies’ impact on employee morale and trust in the company, and an equal percentage expressed concern about their impact on compliance with privacy laws—by, for example, exposing personal information, such as passwords or health conditions.
Littler, which bills itself as the world’s largest employment and labor law practice representing management, waved the caution flag in the report, which surveyed knowledge workers doing their jobs remotely, mostly in tech, financial services and banking.
“Surveillance is unpopular with many employees and could adversely impact employee wellness and mental health, a concern noted by more than one quarter (27%) of respondents. In a competitive labor market, employers known to engage in electronic monitoring practices may have difficulty attracting and retaining top talent.”
Jordan Isrow, a former general counsel at Oxygen Development, said the downsides could increase as the technologies become more sophisticated and potentially invasive.
“AI tools are becoming more sophisticated, and I think you have to draw the line somewhere,” Isrow said. “Yes, you have a higher degree of insight into what your employees are doing, but you’re also maybe creating … a dissonance in the culture that could ultimately be to the detriment of the overall business performance.”
Even so, Isrow, now a partner at Government Law Group, said he would support the use of such tools if he were still in-house, but with caveats.
“I say yes, to a degree, because remote work has changed the entire dynamic of how managers manage. People used to go into the office and clock in, and for the most part you had localized oversight,” he said.
“You could tell if John left his office and he hasn’t been there for the last three hours, or you can see if someone has been talking at the water cooler and they’re not doing what they should be doing. COVID changed that whole dynamic.”
While the conversations might be uncomfortable, Isrow said employers should be up front about what monitoring tools they are using and why.
“I think that it really is incumbent upon management—the executive ownership or the board of every company—to have transparent conversations with its workforce,” he said.
“Policies are just as strong and important here as the law itself in the sense that the handbook is an understanding or agreement between an employer and employee as to what we expect from you and what you expect from us. For me, that’s a starting point. That builds trust between companies and employees.”
The Littler study found the use of surveillance technologies was most prevalent at the largest businesses. It found that 61% of respondents at companies with more than 10,000 employees are using the tools.
Attorneys say employers generally have wide latitude to monitor employees, as long as they have a legitimate business reason for doing so, operate within the bounds of state privacy laws, provide adequate notice, and get consent from their employees.
But the federal government is starting take notice of how companies track employees and has questioned whether automated surveillance might violate workers’ rights and safety.
Late last year, Jennifer Abruzzo, the general counsel of the National Labor Relations Board, said that certain monitoring practices might impair employees’ right to organize or engage in collective bargaining.
And earlier this month, the White House’s Office of Science and Technology Policy put out a call for public comment on how companies use these tools and how it might harm workers’ mental health or contribute to discriminatory employment practices, especially when used to make decisions about promotions and discipline.
“One of the golden rules of employment law is you must treat employees consistently,” said Becky Baker, a partner with Vinson & Elkins’ labor and employment group. “Are you somehow targeting one category of employee or is your monitoring having a disproportionate, adverse impact on employees of a certain protected class? I think that’s the bigger area of risk, as opposed to just an invasion of privacy claim or a violation of state monitoring law claim.”
Robert Foehl, a professor of business law and ethics at Ohio University, said he can see the justification for using productivity tools for certain jobs. “But if it’s being done across the board without reference to the job, that to me is a different thing, and it indicates an unhealthy culture.”
Foehl, who formerly served as retail giant Target’s first director of corporate compliance and ethics, added: “There are several of these tactics that seems to indicate a low level of trust, and I think that’s a big issue.”
Critics of the tools also argue that their use actually might undermine productivity. A paper published last year in the Harvard Business Review, found that workers under surveillance felt less responsibility for their behavior.
The study, based on a survey of 100 employees in the U.S., found that workers who were monitored “were more likely to report that the authority figure overseeing their surveillance was responsible for their behavior, while the employees who weren’t monitored were more likely to take responsibility for their actions,” the authors wrote.
Foehl said while employers prize productivity, they also should consider their employees’ humanity.
“You really need to think about are you respecting the human beings that work for you, are you respecting their dignity, their autonomy and sense of privacy,” he said. “When employees feel valued, they are more productive across the board.”