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Employer Liability for Employee Use of Company-Owned Computer Equipment

The rapid evolution of the personal computer over the last 20 years or so has resulted in widespread use of personal computers in business. More and more employees use a personal computer in the workplace, including a large segment for whom the use of a computer is essential to their job function. Many employees who have access to personal computers in the workplace have an employer-assigned email address, access to the employer’s email system, and access to the Internet. The increasing use of personal computers in the workplace has forced employers to confront several legal issues, including the extent an employer might become liable for the tortious or criminal use of an employer-supplied computer.

The doctrine of respondeat superior is a well-established legal principle that applies to the employer-employee relationship. This principle holds that, when an employee is acting within the scope of his employment, the employer can be held liable for the employee’s acts that harm another. Respondeat superior applies to an employee’s use or abuse of email and the Internet. Accordingly, an employer must concern itself with potentially harmful employee activities connected to the use of email and the Internet. Downloading obscene or pornographic material and distributing it through email could create a hostile work environment, which constitutes sexual harassment for which the employer could be found at fault. An employer could also be liable for securities fraud conducted by an employee with the use of a company computer.

The Internet is can be a tool for criminal acts such as theft, embezzlement, fraud, and infringement of intellectual property. In addition, an international treaty addressing the use of the Internet could require the United States to pass legislation holding corporations responsible for the criminal acts of employees through the use of the Internet. Even if an employee’s acts were so disconnected with the scope of his employment to preclude an employer’s criminal liability, evidence of criminal activity contained on an employer-supplied computer or even illegal materials such as child pornography could lead to the seizure of company-owned equipment.

Even where an employee has acted outside of the scope of his or her employment, seemingly absolving the employer from liability, there are other legal theories upon which an employer might be found liable for the bad acts of its employees. Two such theories are negligent hiring and negligent supervision. Under these theories, an employer could be held liable for negligence if it had reason to believe that the employee was an unfit candidate for employment or that he or she might engage in harmful acts but was not properly monitored. Under these theories, it is not necessary that the employee’s acts be within the scope of employment in order for liability to attach to the employer.

To shield themselves from liability from the acts of their employees involving email and the Internet, employers are increasingly urged to establish clear Internet use policies that clearly outline both appropriate and prohibited uses of company computer equipment. Such policies should be in writing and distributed to all employees. Many employers incorporate such policies into employment agreements and require their employees to agree in writing to abide by the policies. In addition, Internet use policies must be consistently enforced in order to provide employers with the maximum possible protection and avoid charges of discrimination due to uneven enforcement.

Copyright 2012 LexisNexis, a division of Reed Elsevier Inc.

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