Internal corporate online systems or “Intranets”, made available to employees for information and administrative purposes, generate two recent cases of interest. In the first, a terminated employee brought suit alleging wrongful termination and retaliation. The employer sought to compel arbitration instead, on the basis that the plaintiff had agreed, in an online agreement, to submit any employment disputes to arbitration. The plaintiff’s assertion was that a supervisor had “signed”, that is, clicked the employee’s assent to arbitration on the Company Intranet. While the employer had attempted to limit access to employees’ Intranet accounts by assigning each employee a password, the court found that protection insufficient. The employer “did not have adequate procedures to maintain the security of Intranet passwords, to restrict unauthorized access . . . to determine whether electronic signatures were genuine or to determine who opened individual e-mails.” (Kerr v. Dillard Store Services, Inc., 2009 WL385863 (D. Kan., February 17, 2009)). The practical guidance is simply that in relying on an electronic signature, one must take care to ensure that the “signature” is authentic.
In another recent decision, a federal district court held that an employee’s refusal to use the employer’s web-based personnel systems, based on concerns that the systems did not adequately protect the employee’s personal confidential information, is protected whistleblowing activity under the New Jersey state “Conscientious Employee Protection Act”. The employee’s reservations about the employer Intranet included both the disclaimer that the employee had no expectation of privacy in using the systems (and would be asked to enter personally identifiable information), and that the system lacked user authentication features (such as passwords) for non-supervisory employees. The employee therefore complained to the employer both about its employee web portal and its web-based Talent Management System. However, after refusing directions to use the employer Intranets and after experiencing other negative job performance feedback, the employee was terminated.
The federal district court denied the employer UPS’s motion for summary judgment, finding that the employee’s objections appear to be protected activity under the exceptionally broad New Jersey state law on employee whistleblowing. Although no allegations were made that the employer’s Intranets or systems in themselves violated any law, the court found that forcing the employee to use them may violate public policy as expressed in other laws on personal privacy, and therefore the job termination could be considered retaliatory in violation of state law. (Zungoli v. United Parcel Service, Inc. (District Ct. N.J., Opinion, July 8, 2009). As a district court opinion, the case is not precedential, and the case has since settled.