By MARJO
JOHNE
Special to The Globe and Mail
Friday, January 10,
2003 – Print Edition, Page C1
As a travelling sales representative, Marilyn's workdays were largely
unsupervised -- that is, until her employer hired a private eye to follow
her.
Through the detective agency, Marilyn's employer, a Toronto-based tile
distributor, found out that she had been picking up her husband and
driving him to work during the time she was supposed to be visiting
clients. Shortly after, Marilyn was fired for stealing company time and
money (the firm had been giving her a car allowance). She doesn't dispute
the reasons for her dismissal, but she says the experience of being spied
on was unnerving.
"I felt violated," says Marilyn, who has asked that her real name not
be used. "I mean, it's creepy -- just the thought of someone following you
and watching you."
While companies have long used private investigators to keep watch on
their employees or look into questionable activities, private
investigators say demand for this type of service has increased in recent
years, especially in the area of background checks.
"It's an extremely high-growth industry -- almost every major
corporation in the country today is using private investigators," says
Brian King, president of King-Reed & Associates Ltd., the country's
largest private investigations company. In the past three years, King-Reed
has seen annual growth of 25 per cent in corporate services. The company's
Toronto office alone handles about 250 employee surveillance cases a
month, and recently opened a division devoted exclusively to employee
screening.
"Companies are saying: 'We've got to do more due diligence when hiring,
and even promoting people,' " Mr. King says. "And we're not just talking
about large companies; even small operations are screening more carefully
because many large firms won't do business with them unless they do their
due diligence on their employees."
Mr. King attributes the increase in background checks to three things:
the growing reluctance of companies to give references, the increased
consciousness about security that followed Sept. 11, and the higher
standards of accountability companies have set for themselves -- and which
shareholders have demanded -- in the wake of the Enron and WorldCom
scandals.
A study by U.S. firm Aon Consulting Inc. underlines the importance of
thorough background checks. The survey found that 7 per cent of employees
have a criminal record, 37 per cent have falsified their educational
experience and 30 per cent have lied about their work experience.
The scope and depth of these background checks -- for which employees
have to give their consent -- tend to vary according to the type of
company and the responsibilities of the employee in question. Generally,
however, background checks look for criminal convictions and verify past
employment and education. Some employers may also want to know about an
employee's credit history or get a peek at his or her driver's
abstract.
Where a high-level position is involved, employers will sometimes ask
investigators to search legal records to see if a candidate has been sued
by a former employer or business partner -- or if they themselves have
sued any of these parties. If the candidate belongs to a regulated
profession, a check with the regulatory body may also be in order.
Suspicions of employee theft or fraud and complaints of sexual
harassment or office bullying are also making companies turn to private
eyes for help, as are cases of drug or alcohol abuse and misuse of company
time.
In a survey of 1,627 U.S. companies by the American Management
Association, more than 30 per cent of the firms admitted to watching their
employees through video cameras for security reasons (to prevent theft,
violence or sabotage), while 15 per cent videotaped their employees'
performance. The survey does not indicate whether or not the companies
informed their employees of these practices.
Mark McDougall, president of Stolen Cargo and Equipment Tracking, a
detective agency west of Toronto, says many of the cases he's acted on
involved companies trying to substantiate disability claims, where an
employee is suspected of malingering. The agency has also been asked to
follow employees believed to be playing hooky or engaging in some other
type of misconduct.
One company's board of directors, for instance, asked the agency to
tail its president, who had a habit of disappearing for several hours
during the workday. It turns out the president was going to the gym during
these unaccounted-for periods, and the company fired him, Mr. McDougall
says.
Another assignment involved a chief executive officer suspected of
having an affair with an employee. Mr. McDougall's detective followed the
CEO and videotaped him and the employee hugging and kissing in a bar. Mr.
McDougall doesn't know what became of the CEO, but he says the company
that hired him had a policy against romantic relationships between
executives and employees.
Many companies use private investigators to detect drug or alcohol
abuse. Mr. King says this service is usually requested by firms risking
workplace injuries in the use of sensitive, employee-operated machinery.
For this type of investigation, detectives normally install hidden cameras
in the workplace. They may also set up a surveillance van in the company
parking lot, where much of this kind of illicit activity takes place.
"Companies are being really careful these days," Mr. King says, "because
they could be held liable for injuries or damage resulting from substance
abuse by their employees."
Companies that use private investigators may be breathing a little
easier but they need to be careful about violating employee rights, says
Joe Conforti, a partner with the Toronto law firm Goodmans LLP.
Mr. Conforti says employers must start with the presumption that every
person has a right to a zone of privacy. That zone is substantially
reduced in the workplace, but companies must acknowledge that employees
have a reasonable expectation of privacy in such areas as washrooms and
locker rooms, and off company property.
In court, employees and judges don't always agree on which workplace
areas should be considered private. Keith Richardson found this out the
hard way in 1994, when he was fired from his job as a production foreman
at Davis Wire Industries Ltd. in New Westminster, B.C. The company
installed a hidden video camera in the lunch room after several employees
complained that Mr. Richardson was sleeping during his shifts.
Mr. Richardson took Davis Wire to court for, among other things,
invasion of privacy, but the British Columbia Supreme Court ruled that
Davis Wire had a legitimate right to investigate its employee's suspected
misconduct. It also ruled that Mr. Richardson could have no expectation of
privacy when he was sleeping on company time and on company property.
Where a company suspects that an employee may be doing something that
constitutes a breach of the employment agreement, a "reasonable degree of
surveillance" outside the workplace is considered legally acceptable, Mr.
Conforti says. But the employer has to ensure its investigators don't
harass the employee or trespass on private property.
"Everything is a question of what's reasonable under the
circumstances," Mr. Conforti says. "But the most important thing to keep
in mind is that privacy is not to be taken away lightly, and that workers
have a right not only to privacy but to a workplace that is ethical and
free of harassment."
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