Learn more about the Labor and Employment Group at Schiff Hardin. Attorneys In This Practice Eric L. Barnum Howard R. Barron Wendi J. Berkowitz Max G. Brittain Jr. William J. Carroll Ashley G. Eddy Nicole Finitzo Larry B. Garrett Stephen M. Hankins Victoria Hartanto Valarie Hays Charlene Q. Kalebic Paula M. Ketcham Matthew D. Lahey Neil Lloyd Catherine M. Masters Ralph A. Morris Marc L. Silverman Henry W. Sledz Jr. Patricia Costello Slovak Drahcir M. Smith Julie Furer Stahr Kathleen A. Stimeling Catherine H. Thompson Richard L. Verkler Nora Kersten Walsh Tamera M. Woodard Schiff Hardin Offices One Atlantic Center, Suite 2300 1201 West Peachtree Atlanta, GA 30309 225 Franklin Street, Suite 2600  Boston, MA 02110  233 S Wacker Drive Suite 6600 Chicago, IL 60606 One Westminster Place Suite 200 Lake Forest, IL 60045 900 Third Avenue New York, NY 10022 One Market, Spear Tower 32nd Floor San Francisco, CA 94105 1666 K Street, NW Suite 300 Washington, DC 20006 - - - - - - - - - Join our mailing list. Forward this alert to a friend or colleague.

Schiff Hardin Labor and Employment Alert

California Supreme Court Holds Employees Have Reasonable Expectation of Privacy Against Workplace Surveillance

By Larry Garrett and Victoria Hartanto

The California Supreme Court recently issued a ruling with important implications for privacy issues in the workplace, in this case involving the surveillance of employees using hidden cameras. In Hernandez v. Hillsides, Case No. S147552 (August 3, 2009), the court analyzed the standards for establishing a privacy violation under both the common law and the California Constitution, focusing on (1) whether the employer intentionally intruded into a matter as to which the employee has a reasonable expectation of privacy, and (2) whether the intrusion was highly offensive to a reasonable person.

In Hillsides, the executive director of a non-profit residential facility for abused children discovered evidence that someone was viewing pornographic Web sites from a company computer after hours. Concerned for the safety of the children at the center, the employer installed a video surveillance system in plaintiffs' shared office in order to try to catch the culprit. Plaintiffs themselves were not suspects and were never recorded or videotaped as the recordings only took place overnight when plaintiffs were away from the office. Nonetheless, plaintiffs sued Hillsides for invasion of privacy after discovering the hidden camera.

The court held that, notwithstanding the diminished expectation of privacy which generally applies in the workplace setting, the plaintiffs here had a reasonable expectation that their actions would not be subject to video surveillance by their employer without their knowledge or consent. See also, Sanders v. American Broadcasting Companies, 20 Cal. 4th 907, 911 (1999) (holding that employees have a "limited, but legitimate" expectation of privacy in the workplace against covert videotaping by a journalist, even though conversations in the workplace were not completely private). However, the court ultimately decided that, based on the specific facts of this case, the employer's intrusion was not "highly offensive and sufficiently serious" to constitute a violation of its employees' privacy interests. The court relied on the fact that Hillsides had an especially compelling reason for the surveillance (protecting the children at the center), and that the surveillance was limited to recording on three occasions with the camera pointed only at plaintiffs' computers, and only after business hours such that plaintiffs were never actually videotaped.

Although the court decided that the employer was not liable for a privacy violation, this decision is not a green light to conduct broad surveillance, but rather a warning that employers should provide adequate notice and take steps to limit the scope of intrusion of any such surveillance. Employers who may need to conduct surveillance or otherwise monitor employee activity, such as computer or Internet use, should consider the following factors:

• Prior Notice. When possible without frustrating the objective of the surveillance, employers should provide prior notice to specific employees who may be subject to monitoring. In addition, employers should include the possibility of any monitoring or surveillance in its employee handbooks and policies.
• Reasonable time, place and scope restrictions. Employers who make an effort to minimize the intrusiveness of surveillance or monitoring are less likely to be liable for a privacy violation. Thus, employers should take care to limit the place, time and scope of surveillance as much as circumstances permit.
• Employee's expectations. An employee's reasonable expectation of privacy varies depending on the workplace environment. Employers should take extra precaution when conducting surveillance on enclosed or partially-enclosed office spaces, as opposed to more public areas such as hallways or lobby areas.
• Employer's business needs. Employers should make sure that there is a legitimate business need for taking action that may be construed as an intrusion into employee privacy, such as loss prevention, ensuring the safety of others, or maintaining productivity.

For questions or advice, please contact any attorney in Schiff Hardin's Labor and Employment group.

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