Wearable Technology at Workplaces
25 August 2015
Marian Derham - Partner in the Employment Group
Harbottle & Lewis LLP
Charlie Thompson - Associate
Harbottle & Lewis LLP
Marian Derham and Charlie Thompson look at the legal issues around wearable devices as they find their way into many workplaces, sometimes as a staff benefit.
Wearable technology promises benefits for employers and workers, including greater productivity and better health.
Some major firms are already offering the devices, with every sign that wearables are becoming increasingly popular.
But there is resistance from some staff, who question what happens to the data. The prospect of “Big Brother” employers knowing how many hours an individual has slept and where they go outside working hours is too intrusive for some.
Employers, therefore, should consult and gain consent before these devices are introduced and be aware of data protection rules.
Even for employers that do not intend to offer wearables as a benefit, the risk to their business from the evolving technology requires updating or creating policies as protection against theft, reputational damage and other misuse of wearable devices.
Wearable technology that does a great deal more than tell the time is not only fashionable, but increasingly viewed as a valuable employee benefit. Devices can be worn on the wrist, as glasses or even woven into clothing, while their purposes range from answering a phone call and surfing the web to measuring every aspect of our daily activity.
Incentives to wear
A survey last year by business consultancy PwC suggested that millennials – those born between the early 1980s and early 2000s – were twice as likely as over-35s to adopt a smartwatch or fitness band if their employer paid for it.
There are good reasons for the interest in this technology. A survey by Dr Chris Brauer of the Institute of Management Studies at Goldsmiths, University of London, found that productivity rose by 8.5 per cent among staff who wore smart devices and job satisfaction was 3.5 per cent higher.
A further incentive is that a healthier workforce is generally a more productive one, given that levels of sickness absence in the UK are reportedly higher than in the US, Asia-Pacific and Western Europe.
In addition, use of wearable technology can lower healthcare liabilities if medical insurance is offered to staff. On a more abstract level, the data generated can help employers analyse behaviour and performance. It seems a win-win but studies show that some employers believe wearable technology to be just another distraction.
Equally, some employees find it threatening. They are uncomfortable with the prospect that their employer could know, for example, how many hours they have slept before they turn up for work and where they go afterwards, particularly if the information is used to analyse poor performance or absenteeism.
However, large firms, including eBay and BP, are providing participating employees with wearables. These staff, in turn, have also benefited from a consequent reduction in contributions to their corporate health insurance policies.
More than a fad
Such high-profile corporate adoption seems to suggest that, although it might be fashionable, wearable technology is no passing fad. Growth in use is also likely to continue, given the evident commercial interest and investment in building demand and expanding what these devices can offer. Evidence for this can be found through the number of healthcare and insurance companies that use them in their product offerings. Pru Health is one that offers wearable technology to employees as part of its Vitality programme. Under the scheme, employees are given incentives in return for taking exercise and sharing data about their activities.
There will also be more to wearables than fitness. Google Glass captured headlines in 2012 when it unveiled a prototype that recorded images, audio and video while the user was on the move, and projected content from the internet into their preferred eye.
Research underpinning that project continues and is reaching surprising places. Google is working with Levis Strauss & Co on clothing that interacts with devices. Elsewhere, a biometric band to monitor the wearer’s hydration, blood pressure, oxygen and carbon dioxide levels is on its way.
Yet even as developments from Fitbit, Google, Jawbone, Apple Watch and others expand the frontiers of what is possible, they raise issues about the very information that their devices gather and transmit.
Employers need to think now, as wearable technology moves through its early adopter phase, how it will affect them and whether they ultimately offer it as a benefit. It is easy to see a time when the health of a company’s staff could even become a factor in calculating its value. The stakes could be that high.
Ownership of data
Wearable technology is already with firms that do not provide it, have no policy to govern its usage and may even give it no thought. Many businesses will have someone, somewhere, wearing the personal information-gathering software.
At the very least, employers are likely to find themselves expected to allow wearables, and an outright ban is probably unworkable.
All this raises questions about how to engage with the technology and the opportunities it brings. Not least, whose data it is. The Information Commissioner’s Office (ICO) has already issued a reminder that wearable technology is subject to the Data Protection Act.
Andrew Paterson, Senior Technology Officer at the ICO, wrote last year that there are no exceptions to the Act for organisations gathering information.
“This includes making sure that people are being informed about how their details are being collected and used, only collecting information that is relevant, adequate and not excessive, and ensuring that any information that needs to be collected is kept securely and deleted once it is no longer required,” he said.
There are also issues around protecting the business, as well as employees, from theft, reputational damage and each other.
Although wearable technology is evolving, a process that in itself adds uncertainty to the scope of what devices will be able to do, protective rules can be put in place.
First, an employer must assess the risk to its business, regardless of whether there is any intention to offer devices as a benefit.
In an age when information can be casually, even surreptitiously, recorded, everyone has to make sure that the trust and confidence underpinning conversations within a company are not compromised. This includes those “water-cooler” chats and other private moments, such as office parties, when people sometimes let down their guard.
The protection can take the form of a re-drafted Bring Your Own Device (BYOD) policy to govern data, security, privacy, intellectual property and confidential information.
Employers should make it clear that using wearables to record any aspect of the workplace, including company meetings, disciplinary or grievance proceedings, is expressly prohibited. Rules on the viewing of explicit or inappropriate content may also need updating.
The revised BYOD policy could be supported by anti-harassment, grievance and disciplinary policies covering the misuse of wearables. This would enhance protection for individuals and their employers. Organisations also need to think about updating their employment contracts and ensure that breach of those policies can lead to disciplinary action and possible dismissal.
Another risk from failure to update the rules of conduct is that workers could record meetings and conversations with colleagues, clients or suppliers without their consent. They could also move information from secure corporate storage to their personal devices, either as an act of industrial espionage or an unintended lapse.
These threats are not new. Smartphones already offer such an opportunity. However, wearable technology is likely to be easier to conceal, increasing the risk of covert action.
Caution is also needed in relation to privacy, particularly for wearables focused on improving fitness that collect data, such as number of footsteps, body mass index, calorie intake, hours of sleep and location, as well as sensitive information relating to health.
There are people who are not happy with wearables as an employee benefit, whatever the levels of protection, and it is necessary to address their interests. They may see their introduction as “Orwellian” surveillance – and not just at work. These concerns should be answered by a clear, non-coercive company policy that allows staff to opt out.
Even those who are keen on the technology will want to know about measures to protect their data. If an employer wants to offer wearables to staff, robust regulations and procedures need to be in place to make sure everyone understands how personal data will be collected and that it will not be used in an unfair or discriminatory manner.
A way to allay fears is to render data anonymous when gathered. A survey by PwC in the US found that 70 per cent of respondents would wear employer-provided wearables, streaming anonymous information to a pool, in exchange for a break on their insurance premiums.
Another factor influencing employees’ reaction is their line of work. Research into this area, including Sarah O’Connor’s wearables at work project for the Financial Times (www.lexisurl.com/zybzf), seems to indicate that employee scepticism is likely to be more of an obstacle in white-collar workplaces and where millennials are a minority.
Millennials, who are likely to be more comfortable with social media, appear to have fewer qualms about privacy than older generations and are likely to be more receptive.
Similarly, it will probably be easier in the more progressive and informal culture of a start-up to find employee enthusiasm.
Doing nothing is not an option
Wearable technology is already present in the workplace, so prudent employers will regulate its use, not least for their own protection, rather than ignore or push against a trickle that may become a tide.
Those high-profile organisations already trying to harness its potential, by linking to their benefit packages and incentive schemes while seeking to improve staff wellbeing and productivity, are the standard bearers of a likely trend.
However, employers need to be aware of and responsive to the significant privacy and data protection risks, as well as how best to present such schemes to the workforce. Not everyone will be receptive to the collection of their personal data through smart technology. What to some may be an obvious benefit, to others may be a bane.
Image by Pay and Benefits Magazine