Wiretapping in the Workplace

The recent turmoil, investigation and controversy surrounding President Donald Trump’s firing of former FBI Director James Comey has thrust the issue of wiretapping into the public and political spotlight. “James Comey better hope that there are no ‘tapes’ of our conversations before he starts leaking to the press!,” President Trump tweeted on May 12, 2017, suggesting that “tapes” of his private conversations with Director Comey might exist. Most recently, the White House, responding to bipartisan criticism, has been pressed to divulge whether there really are any secret recordings of the president’s private conversations with the former FBI Director. Time will tell whether the Trump Administration comes clean and whether any recordings actually do exist (and, if so, what the implications might be).

All of this commotion prompted me to think about wiretapping in the workplace and, specifically, the issue of audio recordings or, as President Trump has expressed, “tapes” of conversations secretly recorded by an employer of its employees. What types of audio or tape recordings are legally permitted in the employment environment?

There are three primary sources of legal authorities governing the issue of workplace monitoring: the federal Electronic Communications Privacy Act, which encompasses both the Wiretap Act and Stored Communications Act, 18 U.S.C. § 2510, et seq.; state statutes prohibiting or regulating such surveillance; and common law protections against the invasion of privacy. Depending on the situation, any one or all three of these bodies of law might apply.

The unlawful recording of telephone calls at the federal level is governed by the Electronic Communications Privacy Act, which provides that an employer may not record telephone conversations unless one of two exceptions applies. The first exception is the consent exception, which allows an employer to monitor or intercept employee communications so long as the employee consents to the surveillance. The issue of consent is generally satisfied, or is at least implied, where an employee is notified that his/her calls are being recorded, or has expressly given consent pursuant to an employment contract or company policy. To demonstrate or obtain an employee’s consent, employers should notify and forewarn their employees that their calls may be recorded, and that they have a limited expectation of privacy in the workplace.

The second exception to the prohibition against intercepting oral communications under the federal Wiretap Act is known as the “business extension” or “business use” exception. To satisfy this exception, there are two requirements: wiretapping is allowed (i) when the oral communication is recorded or intercepted through a device furnished to the subscriber or user by a provider of wire or electronic communication service in the ordinary course of its business; or (ii) being used by the subscriber or user in the ordinary course of its business. Employers may engage in the legal surveillance of oral telephone communications if they do it in the ordinary course of their business. This exception is particularly important to employers who maintain telemarketing or customer service operations because of their interest in ensuring quality control. Beyond the telemarketing industry, under federal law, when an employee uses an employer’s telephone systems, the employer generally may monitor, intercept, and record the employee’s conversations without the employee’s consent so long as the employee’s call is work-related. Also, an employer’s need to protect trade secrets or ensure compliance with non-compete agreements ordinarily will justify the surveillance of an employee’s calls. Similarly, when an employer has a reasonable suspicion that an employee is engaged in misconduct or violating company policy, the employer normally can justify the recording of an employee’s work-related calls. Employers also generally enjoy greater latitude in recording employee conversations and monitoring employee calls from telephones designated for business use only.

Still, under federal law, the surveillance of an employee’s telephone calls is not absolute. An employer’s surveillance of an employee’s personal phone calls beyond the point of determining whether the call is work-related (or not) is generally considered to be outside “the ordinary course of business,” and thus prohibited by the Wiretap Act. Furthermore, an employer’s general policy of monitoring employee calls does not by itself legitimize the wholesale surveillance of employee calls or establish that all calls occur in the ordinary course of business. Rather, each act of surveillance is scrutinized to ensure the wiretapping was reasonably business-related.

Employers also must be mindful of state-specific law before recording employee calls. Most states require that at least one party to a conversation consent to the recording of the conversation for such recording to be lawful. In other words, in “one-party” states where the consent of one party is required, an employer can record a conversation with its employee so long as the employer is a party to the conversation. For example, in New Jersey, it is not unlawful for an individual who is a party to (or has consent from a party to) an in-person or electronic communication to record and/or disclose the content of said communication unless the person is doing so for the purpose of committing a tortious or criminal act. N.J.S.A. 2A:156A-4(d). Similarly, the federal Wiretap Act is a one-party consent statute.

There are several states, however, that require the consent of both parties before a call can be lawfully recorded. California law, for example, requires parties to a conversation to be notified, either by a recorded message or a beep, that the conversation is being recorded or monitored. Pennsylvania’s wiretapping law likewise is a “two-party consent” law, making it a crime to intercept or record a telephone call or conversation unless all parties to the conversation consent. 18 Pa. Cons. Stat. § 5702, et seq. What constitutes “consent” can be contentious but, generally, consent is given if the parties to the call are clearly notified that the conversation will be recorded and they continue with the conversation, as their consent is implied. Because telephone monitoring is the mode of workplace communication most likely to be affected by the laws of the state where the communications occur, employers situated in states like California or Pennsylvania, or employers who engage in telephone calls with employees located in such states, must disclose to their employees that the call is being monitored or recorded. They should obtain their employees’ consent to such recording, or risk being found in violation of applicable state law.

Labor law also may be implicated by an employer’s surveillance of its employees. For employers who employ unionized employees, the National Labor Relations Board has held that the surveillance of any portion of the workplace is a condition of employment that typically must be the subject of collective bargaining and agreed to by the union prior to implementation. However, surveillance can become problematic for non-union employers. For instance, an employer’s surveillance or recording of employee calls during a union-organizing campaign can implicate the NLRA and lead to consequences for the employer. An employer’s surveillance or recording of employee telephone calls also can implicate common law privacy rights, which also should be considered by employers when implementing such policies or conducting such surveillance.

To comply with these proscriptions, employers seeking to intercept, record or monitor employee phone calls should establish and disseminate to their employees clearly written company policies that their telephone calls may be subject to monitoring and surveillance without any further warning. Employers should consider including certain key provisions in their establishment of companywide telephone monitoring policies, including but not limited to:

• Monitoring can occur at any time, for any reason, with or without notice, for any legitimate business-related purpose;
• The employer’s communication (telephone) systems are the property of the employer, and the employee should have no expectation of privacy in his/her use of the company telephone devices and equipment;
• The employer’s communication systems are for business use only;
• The use of the employer’s communication systems for discriminatory, harassing, bullying or other forms of misuse or unlawful misconduct is prohibited;
• The transmittal or dissemination of the employer’s intellectual property, confidential or proprietary information, or trade secrets through the use of the employer’s telephone systems is prohibited; and
• The employee’s unauthorized use of the employer’s information systems can result in discipline, up to and including the termination of employment.

Even with a monitoring policy in place, employers should expressly state that they are not obligated to monitor employee communications. Otherwise, should harmful, discriminatory or offensive conduct occur through the use of the employer’s telephone systems, employees may claim that the employer failed to protect them (or failed to appropriately investigate misconduct) through such surveillance. As with any company policy, employers should require all employees to sign a written acknowledgment that they have received, read and understood these policies, and that they agree to abide by such terms as a condition of their employment with the company. These policies should be reaffirmed by employees periodically in the ordinary course of an employer’s business.

Questions about wiretapping in the workplace? Call your employment law attorney.