This document provides an analysis of electronic monitoring in the workplace and how it relates to employee privacy and organizational trust. It discusses the benefits organizations perceive from monitoring, such as measuring performance, but also the risks it poses in interfering with privacy and reducing trust. A balanced monitoring policy that respects privacy and is supported by a culture of trust is suggested. Too much monitoring can increase stress and reduce creativity, satisfaction and commitment over time. The changing expectations of new generations also challenge traditional monitoring approaches.

1. Electronic monitoring, privacy and trust: A
workplace related triad
by
Robert Orzanna
Student ID: 2902913
Submitted to the Faculty of Management
in the paper Individuals, Behaviour & Work
The University of Auckland
Auckland, New Zealand
September 2011

2. Abstract
This essay analyses the use of electronic monitoring in today organisations
and contrasts possible benefits and risks. Furthermore it outlines the interfer-
ence with the individual right to privacy and eventually attempts to understand
the influence of trust in this workplace related triad. It is finally suggested that
organisations should use a balanced monitoring policy which itself is supported
by a strong organisational trust culture. Research findings of the last years
will be thereby used to emphasise the overall importance of both, electronic
monitoring and trust.
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3. Introduction
The last decades were dominated by an immense progress in technological develop-
ment that led to a paradigm shift induced through the era of computerisation. The
internet and other technologies that make use of it have a wide influence on different
facets of people’s present life. However, not only individual life has been changing but
also organisational life and culture is challenged through the new technological oppor-
tunities of governance and control (Mello, 2003). Nowadays especially organisations
in bureaucratic western cultures often cannot be imagined without comprehensive
electronic monitoring policies, such as if individual privacy and organisational trust
do not matter. How far should or can monitoring be taken in order to not sensibly
interfere privacy and to demolish the foundation for organisation-wide trust?
This essay analyses the concepts and implications of electronic monitoring, the
individual right to privacy and trust in the context of a workplace related triad.
Mainpart
The practise of monitoring is not a new phenomenon and its chances for organisations
have been acknowledged since the early decades of the 20th century where monitor-
ing was used to supervise individuals according to their productivity (Robertson,
1999). However, due to the rapid growth of technology and constant cost decreases
for those technologies in the past decades the possibilities and use completely have
been changing towards the new form of electronic monitoring. Electronic monitoring
refers to certain practices and policies undertaken by organisational management to
store, analyse and report information about individual workplace behaviour with the
use of computer technologies (Mishra and Crampton, 1998). In contrast to personal
monitoring through a supervisor electronic monitoring is rather impersonal, often
imperceptible and far more extensive with the possibility to gather almost all infor-
mation on individual workplace behaviour. Actual examples for monitoring practices
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4. range from eavesdropping, internet monitoring, video surveillance, the interception
of voice and electronic mail, to location tracking within the organisation (Flanagan,
1994). Albeit the majority of electronic monitoring systems have been developed over
the recent years, the total use of monitoring practices is extensive. Referring to figures
from the Centre of Business Ethics1
for the year 2003 indicate that approximately 92
per cent of the surveyed organisations use at least one or more forms of electronic
monitoring and 20 per cent do not have a formal written monitoring policy. These
figures indicate that such an increased organisational interest for control may result
in ethical implications, primarily the loss of privacy for the individual who is likely
to pay the burden. This demonstrates the importance of a consensus on a proper use
of monitoring practices.
To begin with, the important question arises what possible benefits organisa-
tions perceive through to the use of electronic monitoring. According to King (2003)
thereby three fields of benefits can be differentiated.
− Measuring work performance. It is often argued that not only shareholders
but the overall organisation and even society have an incentive that organisational
members perform according their possible capabilities. A common assumption is that
improved performance of the individual leads to better goods and services that con-
sumers benefit from (i.e. the society), which positively impacts the revenues of the
organisation and eventually let the individual earn his laurels by benefiting from the
success of the organisations with regard to reduced likelihood of dismissal and in-
creased wages or noncash rewards. It is argued that by applying monitoring practices
organisational members are able to review their actual work performance and reveal
their deficits. Hence, from an individual perspective electronic monitoring may be
used as a performance evaluation and training component to improve the individual
skills (Greenlaw and Prundeanu, 1997). From an organisational perspective human
1
See survey “You’ve Got Mail...And the Boss Knows.”, Centre of Business Ethics at Bentley
College (2003).
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5. resource management may be enabled to better consider work performance in their
decision-making, i.e. to discharge unproductive workforce.
− Non-work related surveillance. There are not only chances for work related
objectives. In many cases organisations monitor individuals by installing systems such
as video cameras to prevent thefts, protect organisational secrets and to ensure that
organisational resources are used for nothing but work related tasks (Green, 1997).
This becomes particularly relevant to organisations since individuals engage in non-
work activities on the internet, generally known as cyberslacking. However, those
activities often not only relate to personal use within the law but also to illegal inter-
net abuse with regard to pornography or copyright infringements (Rosenberg, 1999).
Without considering the reasons for individuals to cyberslack, from a perspective of
the posed damages, there could be argued in favour of surveillance as a chance to
protect the organisation and its stakeholders as well as other affected third parties
from possible damage.
− Information storage and retrieval. Electronic monitoring is often consid-
ered as useful and important with regard to the possibility to retrieve information
and data which have been deleted by organisational members, regardless of whether
this was done accidentally or on purpose (Leahy, 2002).
“Privacy is the condition of not having undocumented personal knowledge about
one possessed by others.” This definition from Parent (1992) points out that equally
which of the incentives above drive an organisation to use electronic monitoring sys-
tems and how legitimate the purpose may be viewed from the perspective of an or-
ganisation, eventually they all interfere with the individual privacy in the workplace.
Thereby the decision about the scale of electronic monitoring used by organisations
refers to an ethical problem. If privacy is seen as a universal and inviolable hu-
man right such as constituted by law2
, then there is no tolerance for any monitoring
2
see The Universal Declaration of Human Rights, Article 12.
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6. practice as long as the individual does not accept it by choice.
Apart from the general issue of the interference of privacy, especially in practice,
electronic monitoring bears another risk. Where is the sensible data stored and how
is the access authorisation defined? Organisations that apply electronic monitoring
should respond to these issues with a information storage policy that strictly defines
permissions and saves logged data securely. However, in the popular race for cost
leadership it is not unusual for organisations to outsource their information technol-
ogy to reduce costs and let the infrastructure be managed by specialised technology
corporations. It is questionable whether a confiding handling of sensitive information
can be guaranteed when the provided data is stored on servers provided by external
organisations or even in a virtual cloud where access rules are rather unclear than
obvious.
With regard to the chances and risks it is suggested for organisations to establish
balanced monitoring practices that serve a protective function, not only for the organ-
isation and the wider society but also bearing in mind the individual member’s right
to privacy and the freedom to evolve. Establishing too strict monitoring controls,
however, has a lot more consequences. Research shows that too strict monitoring
rules induces stress and tensions for an individual as he has to be more concerned
his work progress and whether he works according to his specifications (see Tabak
and Smith, 2005). Whilst increased monitoring may be positively correlated with
productivity increases on short-term, it causes psychological and physiological health
problems, lowers morale and increases dissatisfaction on a long-term perspective as
individuals perceive an existent environment of distrust (Tabak and Smith, 2005).
When the perceived control over the own work diminishes, eventually also creativ-
ity may extenuate. Individuals will not bear the risk to think creatively as creative
thinking can lead to failures which are then punished through performance orientated
monitoring. That is, what was prior related to the chance for work performance and
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7. its measurability is certainly a controversial field as monitoring attempts to measure
performance by objectifying the individual work (Worsnop, 1993). Practical examples
are the measurement of keystrokes or the time that the computer remains idle. Such
objectivity, one the one hand an unbiased performance evaluation, however, on the
other hand may not reflect the actual value of an individual work and eventually neg-
atively impacts the motivation of an individual to do high-quality non-measurable
work (Lund, 1992). An organisation which relies on such performance indicators
gained through monitoring may not be able to take proper decisions when its general
decision-making is solely based on such performance indicators.
So far the chances and risks and the resulting need for a proper balance between
them were outlined. However, it is also important to consider the circumstances un-
der that electronic monitoring are be practised by an organisation. First of all, what
if an organisational member does not even know that he is being monitored? Figures
for the U.S. show that about 20 per cent of the surveyed organisations do not inform
organisational members about their monitoring practices3
. Hence, secret monitoring
may not be a seldom practise at all. And it may be attracting at first glance. As
long as individuals are not informed about the monitoring practices in an organisa-
tion, increased stress and tensions are likely to not occur. However, to intrude into
the privacy of an individual without his awareness is an ethical issue and it raises
critical thoughts about the legal provision of countries such as the United States
whose Electronic Communication Privacy Act (ECPA) does not explicitly forbid se-
cret monitoring as long as no wire, oral or electronic communication is intercepted
(King, 2003). In other countries such as Germany, secret monitoring is prohibited
and organisations must inform organisational members that they are being monitored
in the workplace and by accepting a job offer, the individual gives his consent to the
monitoring policies (Rothstein, 2000). It may then be argued that the overall organ-
3
See footnote 1.
5

8. isation mutually agreed on corporate monitoring practices. Nevertheless it may still
be problematical. What if special circumstances forces an individual to accept that
he is being monitored although it does not align with his perceived value of privacy
and conviction? Individual circumstances such as sudden dismissal as well as societal
circumstances such as economic recession or high unemployment may have left him
no other choice to accept the intrusion into his privacy.
The arguments above consider the right and possibility to enforce monitoring
practices on the side of the management of organisations. However, eventually the
generational change may have the largest impact on whether organisations are actu-
ally able to establish monitoring practices or not. Since the invention of the internet a
new generation grew up who essentially differentiate themselves from previous gener-
ations. The so-called NetGen, grown up with the further development of the internet,
define the young working class from today who have different values, attitudes and
beliefs which are reflected in their workplace behaviour. These young individuals
tend to say what they think, are against hierarchical systems, disloyal in the sense
that they do not want to bound themselves lifelong to a particular organisation and
are often rebellious (Burke and Ng, 2006). A lot of them are well educated that
make them valuable for organisation to cope the entrepreneurial challenges that they
are faced with. Rather than being depended of the organisation the opposite may
be true and organisations therefore have to be concerned about the own attraction
as an employer (Burke and Cooper, 2006). Thus, it is questionable whether and to
what extent monitoring is practised can be decided solely by management without
considering the voice of the workforce.
Culture and trust, two factors that itself are strongly interrelated, influence whether
and to what extent electronic monitoring is practised in organisations. Whilst bu-
reaucratic cultures such as the U.S. prefer electronic monitoring for its control and
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9. performance reasons, supportive cultures such as Japan most often disagree to an ex-
tensive use of monitoring practices as they perceive it as a want of confidence (Stoney,
2001).
It is important to understand therefore how trust is formed and how it influences
the acceptance of monitoring practices. In general trust is viewed as the interpersonal,
willingness to belief and depend on another party (Mayer and Schoorman, 1995). Ac-
cording to Tabak and Smith (2005) individuals categorise other individuals into either
trustworthy or not trustworthy depending on three factors: (1) Their experiences in
the current organisation, (2) their past experiences in other organisations and (3)
their fundamental disposition to trust. Depending on the categorisation processed
by management and organisational members will eventually influence the extent of
the use and the acceptance of monitoring systems. As stated above, a management
that perceives others as not trustworthy is likely to control more whereas individuals
perceiving management as not trustworthy will not see monitoring practices soley as
for their own benefit but perceive a loss of privacy and are likely to respond with
turnovers or lower commitment.
Conclusion
“Trust, but verify.”, a quote in the range of politics that may be also applied by
organisations. As stated above, trust has an enormous influence on how electronic
monitoring is perceived and whether certain practises are applied or not. However,
trust and control must be balanced as in general too much trust is encroached and
too much control results in financial and personal losses. Overall the practise of
electronic monitoring in the workplace is a controversial issue. There are chances
that inexorably interfere with the risk for the individual loss of privacy. But still
monitoring may be sensible as long as it is serviceable for the whole thing, guided by
monitoring policies for reasonable business purposes such as for the benefit and safety
of an individual within an organisation, when it is deployed as a feedback or training
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10. module with the voluntary approval of the individual in work tasks which benefit
from it such as in the helpline industry to analyse and improve customer interaction.
On the contrary, monitoring individuals on the purpose of storing sensible data
such as the individual time spent on the lavatory or information about possible love
affairs of individuals are hard to justify.4
They bear the risk that the experienced
loss of the democratic foundation and values in the political sphere in many western
democratic countries becomes eventually also part of our working life. It is certainly
worth to think whether this further shift towards a total surveillance society is an
appreciated step in human life.
4
These forms of electronic monitoring became public in 2008 and refer to one of the largest
scandals of employee surveillance undertaken by the German supermarket chain Lidl.
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