Top 10 reasons why companies surveillance employees

Internal surveillance protocols have been prevalent in businesses for a very long time. The only difference now is that the advancement of technology and artificial intelligence has boosted the monitoring and tracking (M&T) capabilities afforded to employers. Furthermore, the significant reduction in cost, to procure said technology, especially in the last 10 years, has made the decision to invest in M&T technology simpler. But an investment is still, just that. So, what are the top 10 reasons why companies choose to part ways with their hard-earned profits to surveillance employees?

1. Companies call it ‘Productivity Monitoring’ or in simple terms ‘Making sure you are doing your job’

Collected data from M&T technology awards employers the opportunity to translate those 0’s and 1’s into productivity intelligence. This intelligence aids designated managerial and HR personnel to complete systemic performance reviews. The intelligence also helps aid decision making, by providing evidence to safeguard the company against legal repercussions. However, beyond these fancy cloaked reasons the rawest and archaic one simply put is distrust. Research conducted by Opinion Matters, on behalf of Ricoh Europe, found that 65% of employers do not trust their employees. Microsoft’s 2022 study noted that 85% of leaders found it challenging to have confidence that employees are being productive and 49% of managers had a lack of trust for their direct reports. But why the lack of trust?

Of late, it can easily be pinned on anti-productivity influencers with their viral videos. You know the ones I am talking about. The ones who come up with creative ways on how to make it look like you are working, when in fact you’re out doing something else. Spoiler alert! Most of these individuals don’t actually do what they preach, just a simple fact to remember, before you get fired for following a scam. Let’s not forget the ongoing bare minimum approach trend. We are winning now, thanks ‘Lazy Girl Jobs’. Though the principal message has no relevance to the name, the movement calls for individuals to find so called ‘Lazy Jobs’ where you can do the bare minimum and get paid a good salary. The idea sounds appealing, to most, but the reality is far from the pitched simplicity of it all.

These unfortunate viral videos have further inspired employers to implement M&T protocols as a knee-jerk reaction to these anti-productivity influencers.

2. Protection against targeted internal threats

Companies have seen a significant increase in average losses due to internal threats. Zurich reported that UK businesses recorded average losses of nearly £140,000 in 2022, an increase of 19% from the previous year. Whilst Statistic Brain noted that US businesses face near $50 billion each year. Ponemon Institutes ‘Cost of Insider Threats: Global Report’ noted that the cost of credential theft to organisations has increased by 65% in 2020 with the average time taken to contain an insider threat increasing from 77 to 85 days. Naturally, increase in days means an increase in the overall cost when dealing with each case. So, what are some of the top internal threats?

• Tangible assets theft – Inventory, company equipment and etc

• Intellectual property theft

• Data theft – Customer data, financial records and etc

• Disgruntled employees – emotionally driven to immobilise and damage

• Corporate Espionage – strategically driven to immobilise and damage

3. Protection against internal negligence

No matter who you are at one point or another you have made a mistake, in your professional career, that would have cost the company something. Whether it be a small or large sum, it is still a contribution towards the annual total loss. So, though most would argue that mistakes happen, businesses would argue that if their workforce diligently followed set policies and procedures, most negligible actions would be eradicated, positively effecting their bottom line. The HSE reported in their 2019/20 review that injuries alone cost the British economy in excess of £7 billion. Whilst IBM noted in their UK Data Breach report that UK businesses spend on average £3.2 million to cover liability costs, making the UK the sixth most expensive country for data breaches. IBM also noted that the two major causes were phishing (16% of total value) and stolen credentials (15% of total value). Highlighted below are some of the highest reoccurring causations for costly employee negligence.

• Failure to follow basic security protocols (i.e. password securing and use of insecure devices to access sensitive, business critical databases)

• Employee errors – especially by those with privileged access rights to sensitive databases on platforms they have a lack of understanding and training on.

4. Litigation & Liability protection

2022/23 witnessed over 30,000 cases submitted for review by the UK employment tribunal (ET), an increase of over 70% since 2016/17. Now, it is fair to say that one of the major contributing factors to this astronomical climb is case submission fees being quashed. But none-the-less employers are stuck in a very precarious position, as the average cost to businesses for each tribunal claim averages out to £8500. This cost takes into consideration spent or hired man hours, either within the workforce or outside consultants, preparing a defence or investigating allegations made. Below I have listed some of the key contributors to costly litigation and liability losses.

• Employee negligence – failing to follow operational procedures, especially when it comes to health and safety protocols is the largest contributor to business liability losses, over £7 billion per annum (with a steady incline of over 5% YOY)

• Poor leadership training and development – with the already highlighted tribunal statistics it comes as no surprise that poor leadership is the highest contributor to businesses having to take major hits at an ET or negotiate in costly out of court settlements.

• Breach of legislation within a regulated and compulsory framework – biggest being data legislation breaches, the ICO reported a filing of £14.3 million in fines for 2023, the largest being TikTok, which came in at a whopping £12.7 million.

5. Employee protection

Whether it be external or internal threats, the number of allegations reported are on the rise. Co-op, a major retailer in the UK, recorded over 1300 physical assaults witnessed by their staff in 2023. A noted increase of over 33% from 2022. But this is not an isolated problem. The British Retail Consortium reported an 89% increase of daily incidents recorded by retailers ranging from verbal abuse to physical violence, between 2019/22. Want some more, no problem, recently the NHS conducted a staff survey, from the 650,000+ respondents, over 84,000 reported they were the victim of sexual assault and harassment. 30% of these reports were against colleagues in 2023.

Other considerations are:

• Discrimination and harassment

• Privacy violations

• Internal physical and verbal abuse

• Physical safety hazards

• Cyber security threats

6. Protection against external threats

The World Security Report (WSR), commissioned by Allied Universal, noted that security incidents cost companies $1 trillion in 2022. Following the input from over 1700 chief security officers (CSO) from companies scattered across 30 different countries with a combined annual revenue exceeding a quarter of the worlds GDP. The WSR also noted that threats from hackers, protestors, spies and economic criminals are likely to increase with near half pre-empting a likely attack on their own organisation within a year. It comes as no surprise that businesses are actively opting to further tighten their security protocols and increasing the investment in enhancing their employee surveillance technologies.

7. Compliance & Legal requirements

All businesses are in one way or another required to ensure they fully corporate with compliance frameworks and legislation. But specific industries within the UK and US that cannot afford to fall short of set precedent due to its crippling penalties are:

• Financial services: Banks, investment firms, insurance companies, and other financial institutions in both the UK and US are subject to strict regulations, such as the Sarbanes-Oxley Act (SOX) in the US and the Financial Services and Markets Act upheld by the Financial Conduct Authority (FCA) in the UK. These regulations often require monitoring and tracking of employee activities to ensure compliance with laws related to data security, privacy, and financial reporting.

• Healthcare: Hospitals, clinics, medical practices and other healthcare organisations must comply with regulations such as the Health Insurance Portability and Accountability Act (HIPAA) in the US and the General Data Protection Regulation in the UK. Which mandate the protection of patient health information. In addition to the GDPR, the UK have 9 specific legislations to safeguard healthcare practices and is overseen by the Professional Standards Authority (PSA).

• Government Contractors: Companies that contract with government agencies in both the UK and US may be subject to regulations such as the Federal Acquisition Regulation (FAR) and Defense Federal Acquisition Regulation Supplement (DFARS) in the US. The UK’s comparison would be the Public Contracts Regulation and Utilities Contracts Regulation.

• Public Traded Companies: Publicly traded companies in both the UK and US are subject to securities laws and regulations, including SOX and FSMA, which mandate internal controls and financial reporting requirements. Employer monitoring may be necessary to ensure compliance with these regulations and prevent fraud or insider trading.

Other regulated industries include pharmaceuticals, energy, telecommunications, transportation and data control centres. So, we understand they are regulated, but how serious can the penalties be if they are caught in breach of legislation? In 2018 the total fines for companies in breach of GDPR in Ireland and UK was over £420,000. Fast forward to 2023 and the combined total from the top 20 fines issued between 2019-2023 was just under £4 billion, with Meta, Amazon, Tiktok and Google taking home the top 4 spots. That’s a mouth watering 952,000% increase. If that doesn’t sway you about the importance of investing in top of the range employee monitoring and tracking technology, then here is another stat. The combined total of the top 20 GDPR fines is only equivalent to 61.12% of the single penalty issue to Johnson & Johnson in 2023 for a product safety violation, which cost them just under $9 billion.

8. Quality Assurance & Improvement Strategies

Sales and Customer Service companies are key advocates of monitoring and tracking strategies. Why? Simple, it ensures the safety and growth of their bread and butter. Most companies outsource sales and customer service tasks to external companies. To win these contracts you need to not only prove your success to procure the contract but ensure you continually deliver, without excuse. So, these companies utilise every opportunity available to capture data to then convert it into intelligence supporting rapid strategical decision making. Some would argue the methodology used is a little cut throat but the industry would argue that you need a thick skin to even survive in it. So, what kind if decisions can the data aid in making?

• Hiring & Firing or as most in the industry call it the ‘Rank then Yank’ approach, most famously outed by Brittani Pietsch in her recorded firing that went viral on TikTok.

• Operational changes to boost statistics. This can come in the form of reviewed scripts, scheduled call timings and days. Contact methods used. I had a cold call via WhatsApp messaging not long ago, I was impressed and angry at the same time.

• Incentive programs through performance metrics and commission structures.

• Quality assurance through customer satisfaction surveys and many more.

9. Managing Remote Workers

With the uprising of anti-productivity videos, as shared in point 1, it comes as no surprise that one of the main reasons companies invest in monitoring and tracking strategies is because they want to manage their remote workers. They want to ensure that the money they are spending on salaries are being fully utilised so they can grow. A study conducted by McKinsey found that on average organisations with productive teams achieve over 20% higher in sales then poor performing ones. Furthermore, a report from Gallup noted that poor performing or disengaged employees are costing the US economy in excess of $400 billion every year.

10. Public Safety

Public safety is really a combination of all of the above with a few additional points of consideration. Companies would monitor and track staff to assist with early detection of suspicious activity, specifically pertaining to terrorism. It is not unusual for employees within critical infrastructure industries (i.e. transportation, energy, telecommunications and finance) to be priority targets for radical recruitment. It is a legal requirement for companies, especially those within critical infrastructures, to implement and maintain stringent operational procedures to safeguard the public. This requirement is further aided by the bill, recently passed, and expected to become law this year (2024), known as Martyn’s Law, where premises housing events or capabilities of achieving high footfall figures will need to increase their preparedness for protecting all within their jurisdiction.

In conjunction with terrorism another key area of concentration is organised crime. A 2022 report from the House of Commons Library, title Economic crime in the UK noted that ‘serious and organised crime, much of which is economic in nature, is estimated to cost the UK £37 billion a year’.

In conclusion it is simple, every company no matter what its reasoning needs some form of monitoring and tracking for its employees to safeguard the greater good. Whether that is the public, the business or the employees themselves. The extent of the cover put in place should really be in proportion with the risk associated with the operations of the business. After reviewing a wide array of cases, it is evident that failing to invest in some form of monitoring and tracking strategy will most definitely leave the business at more risk in the future should it face any of the complications raised above and not be able to defend itself or take corrective action in advance to prevent reoccurrences. Considering the steady incline trend set by companies heavily investing in employee surveillance and the advancement of AI and tech, the level of monitoring and tracking, that will be readily available to employees, will expand. The question we should all ask is where will employers draw the line?

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