Checking up on workers - business and employee privacy

Nation's Business, Dec, 1990 by Jane Easter Bahls

Checking Up On Workers

Too much--or too little--probing into employees' private lives can be risky for an employer. Here are tips to help you avoid costly lawsuits.

The American public's increasing concern with personal privacy can cause a dilemma for employers. They need extensive information about employees or job applicants to comply with federal regulations and to make prudent decisions about hiring, promotion, security, insurance, discipline, and termination. On the other hand, a company that is too diligent in probing for that information can find itself the target of a lawsuit for invasion of privacy.

"If the employer tries to obtain information about the employee's life with unusually intrusive methods or using the employer's economic power to coerce private choice, there's a risk of liability," says Prof. Henry H. Perritt of the Villanova University School of Law, near Philadelphia. Perritt, who focuses on employment law, is the author of Employee Dismissal Law and Practice (John Wiley & Sons).

"It's a difficult course for the employer to tread," says attorney Albert Zakarian, who specializes in employment litigation for the law firm of Day, Berry & Howard, in Hartford, Conn. Zakarian says that if a company fails to screen an employee adequately before hiring and the employee harms someone, the company might be sued for negligent hiring.

He states the employer dilemma in stark terms: "If you ask too much, you get in trouble, but if you ask too little, you get in worse trouble."

An example of the difficult situations that can arise occurred at Nabors Alaska Drilling Co., in Anchorage, when oil driller Paul Luedtke underwent a company-requested physical examination in connection with an offshore assignment. The test revealed a trace of marijuana in his urine. Luedtke, who was then suspended from his job, said he had assumed the sample would be tested for blood sugar and kidney problems, and he hadn't expected a drug test.

The company told him he would have to pass two subsequent drug tests before he could return to work. Luedtke refused to take the tests, was discharged, and filed a privacy suit.

The company won the case, but not before it has spent more than $100,000 in legal fees over five years.

James C. Taylor, president of Nabors, maintains that the vast majority of the company's employees support the testing program. "A drilling rig is a dangerous place to work," he says. "Nobody wants to work for or with someone who's ... on drugs."

Taylor says the company researched the issue of employee drug testing thoroughly and consulted its attorney before starting the testing program. Conducting a drug test without notice during Luedtke's physical was a company error, Taylor says. "We were in the process of telling everybody about the drug tests--new forms were being printed," which would have informed people about the program, he says.

As the Nabors case shows, employee-privacy issues are growing more complex. Employment-law attorney Kurt Decker of Stevens & Lee, in Reading, Pa., says: "Legislatures and courts are increasingly concerned about employment privacy. While employers may have legitimate business interests that sometimes require infringing on employee privacy, there are compelling reasons to limit this intrusion where no legitimate interest exists."

Traditionally, employees have no control over the information that employers collect and maintain about them. "If the employee provides information, the traditional attitude of the law is that the employer can use it as he sees fit," says Prof. George Trubow, director of John Marshall University's Center for Informatics Law, in Chicago. Unless there's a specific promise to use the information for a particular purpose only, most workers who object to the company's practice have just three choices: put up with the practice, object to the practice and risk termination, or quit the job.

With increasing demands for privacy in all areas of society, Congress has enacted laws protecting privacy in consumer credit records, educational records, and federal government records. Several state legislatures have extended these rights to private employment. Various states now authorize employees to inspect their personnel files, correct inaccuracies, add their own version of disputed information, and restrict the disclosure of employment information to third parties. Numerous states also forbid employers to use polygraph tests and restrict testing for drug use and AIDS.

According to Decker, employers would do well to protect the privacy of their employees regardless of whether they're bound by law to do so. If employers aren't careful in collecting information from employees and in granting others access to it, he says, state and federal legislatures will likely impose further restrictions.

Employers should pay special attention to these areas related to gathering and using information:

Intrusive Activity: Employers have been found liable in certain court cases involving intrusive collection of information. Some employees charge that their reasonable expectations of privacy have been violated by the methods that employers used to collect information; others contend that the information requested is none of the employer's business.