Tuesday, July 1, 2014

Confidentiality in the Workplace

Avoiding liability before, during, and after employment
The topic of confidentiality is always one of great interest, controversy and confusion.  In 2007, I wrote a three-part series on Workplace Confidentiality for Parks & Recreation but recent court decisions are worthy of renewed attention.

The cliché “loose lips sink ships” is a bit ironic, if you think about it. The overstatement aside, equating the legal disaster of breaching a confidentiality with the human disaster of the Titanic, it was actually the failure to disclose information that led to the sinking of the Titanic. Just as ironic, there are also workplace situations where not disclosing a (perceived) confidentiality could also create a legal liability.

Knowing what you can’t disclose, can disclose, and must disclose is important for every manager. In the last 15 years, an increasing number of high courts are affirming that importance through their judgments against organizations and individual managers for disclosure-related employment violations.

Wait – back up – did you say individual managers are being sued?

YES! A disgruntled employee may initially go after the company, but if the company can demonstrate clear and well communicated policies specifying the manager’s responsibilities to maintain confidentialities, yet the manager disregarded them, the attorney will turn their attentions to the individual manager. Most companies do have EPLI (liability) policies, but they won’t extend protections to a non-executive named in a suit – the named manager (and their assets) are hung out to dry. You may be in the right, but you don’t have to be wrong to be sued. Even if you win, you lose if it cost you hundreds of thousands of dollars to defend yourself.

Rather than alarming you, let’s focus on arming you with strong management practices that will keep you from sinking in to the treacherous cold waters of liability.