The Legal Limits of Employees’ Off-Duty Privacy Rights

Organizational Dynamics, Vol. 32, No. 4, pp. 372–383, 2003 ß 2003 Elsevier Inc. All rights reserved. www.organizational-dynamics.com

ISSN 0090-2616/$ – see frontmatter doi:10.1016/j.orgdyn.2003.08.001

The Legal Limits of Employees’ Off-Duty Privacy Rights JOHN A. PEARCE II

DENNIS R. KUHN

THE NEED TO KNOW VERSUS THE RIGHT TO PRIVACY

LEGAL PROTECTION FOR EMPLOYEE PRIVACY

There is increasing concern among managers about the impact that their employees’ offthe-job behavior has on the company. To some extent, this interest is sparked by the recognition that employee lifestyles affect employer health care costs. However, offduty conduct is also suspected to affect the efficiency and productivity of workers, as well as increase an employer’s exposure to liability for defective products made by individuals whose on-the-job performance is affected by what they did off the job. The policy challenge for employers is to determine the legal guidelines that they can use for monitoring and regulating the private conduct of employees without violating employees’ legally protected right to privacy. Can employers regulate employee smoking or illegal substance use? Can employers make employee decisions based on the person’s weight? Can employers attempt to regulate employees’ social relationships and sexual conduct because of their suspicion that there is a danger such conduct might adversely affect the company’s economic interests? The sections that follow examine such questions, both to help determine the legal limits of an employer’s right to regulate the private conduct of employees and to help specify the types of conduct that an employer may control.

The results of a survey by the American Management Association show that two-thirds of U.S. businesses eavesdrop on employees by monitoring telephone calls or computer activity, videotaping on the company premises, or interrogating other employees. Such intrusions into employees’ privacy frequently elicit angry responses, calls for restrictive regulation, and lawsuits. In one case, disciplinary action against a union leader based on such surveillance resulted in a legal action. However, the reality is that the U.S. legal system offers limited protection of employee privacy. The Constitution does not explicitly assure such rights. In fact, it was not until 1965 that the Supreme Court began to address constitutional protections beyond those contained in the Fourth Amendment, which guarantees an individual’s right to be free from unreasonable searches and seizures by the government. The court combined explicit constitutional protections relating to the First Amendment’s right of association, the Fourth Amendment’s protection against unreasonable searches and seizures, and the Fifth Amendment’s protection against self-incrimination, to find that a constitutional right of privacy from government intrusions does exist. However, this protection does not extend to intrusions committed by private parties, specifically non-governmental employers.

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To address the void, the U.S. Congress has created some privacy protections for individuals who work for private employers: 1. The Fair Credit Reporting Act (1970) insures that information collected by consumer reporting agencies and used by employers in making personnel decisions remains confidential and is accurate. The Act requires that when an investigative consumer report is prepared for the employer, the individual be told that it was requested, has the right to ask the investigating agency for the substance of the information in the report, and can ask for reinvestigation and modification of the report if inaccuracies are detected. 2. The Electronic Communications Privacy Act of 1986 restricts an employer’s ability to intercept the wire or electronic communications of private or public employees. However, it does provide important exceptions when the employee gives prior consent to the interception, when it falls within the ordinary course of the company’s business, or when it is not accomplished through the use of an ‘‘electronic, mechanical or other device.’’ 3. The Employee Polygraph Protection Act of 1988 generally prohibits employers from using the polygraph to test workers. Ten states go further in their constitutions by explicitly recognizing the right of employees to privacy from intrusion by their government employers. These states are Alabama, Arizona, California, Florida, Hawaii, Illinois, Louisiana, Montana, South Carolina, and Washington. California’s courts have also added the right of an employee to privacy from private employers. Several other states use statutes to restrict an employer’s consideration of the off-duty conduct of job applicants or employees to make employment decisions. These statutes range from protecting specific activities (e.g., smoking) and using of any lawful product (e.g., alcoholic beverages), to giving broad protection for any form of legal offduty conduct. When laws do not exist, the courts often play a role in protecting privacy by gradually

eroding the strength of the employment-atwill doctrine. This doctrine historically recognized that, absent an agreement on the length of an employment relationship, either party is free to terminate the relation at any time. The impact of the doctrine has been curtailed by federal statutes that protect employees from being fired for union activity (National Labor Relations Act), or from being discriminated against because of race, color, sex, religion, national origin (Civil Rights Act of 1964), disabilities (Americans with Disabilities Act) or age (Age Discrimination in Employment Act). State courts have acted to erode the atwill doctrine. Alaska, Arizona, California, Colorado, Connecticut, Massachusetts, Minnesota, and Montana recognize an implied covenant of good faith within the employment relation and conclude that an arbitrary dismissal of an employee is contrary to this principle. Other courts have identified exceptions where the employer’s conduct gave rise to an expectation that the employee would not be terminated except for cause, or where the termination was related to a reason that would violate established public policy (e.g., terminating an employee for missing work who reported for jury duty). Courts in most states have also found that an employee has a right to sue when an employer intrudes on an employee’s privacy in a highly offensive way, publicly discloses private information that is unwarranted and embarrassing, or places the employee in a ‘‘false light.’’ So, what information can managers use in their attempt to eliminate job applicants and employees whose health, character or lifestyle can adversely affect the organization? To what extent do laws limit an employer’s ability to use evidence of offduty conduct to make employment decisions? These and related employee off-duty privacy issues are addressed in the remainder of this article under five categories of activity: illicit substance use, cigarette smoking, weight, interpersonal relationships, and conduct threatening the business’ competitive position. 373

Substance Abuse Employers are well aware of the continuing problem of substance abuse. The U.S. Department of Labor found that more than 60 percent of adults know someone who has shown up for work under the influence of alcohol or drugs. Employers have learned firsthand that impaired workers cost them in ways that vary from increased medical costs to increased exposure to liability where third parties are affected by the employee’s impairment. Additionally, a study by the University of California-Berkley reveals that a worker consuming ten or more drinks per week proves more likely to file worker’s compensation claims. Finally, the U.S. Department of Labor faults substance abuse for approximately $81 billion dollars of lost productivity, with abusers being twice as likely as coworkers to have skipped a day of work in the last month. Illegal substance abusers pose problems for businesses because of their higher absenteeism, greater medical costs, and increased risks to other workers and third parties. Consequently, businesses have frequently tested employees to detect the use of banned substances. Although public employers are constrained by constitutional protections afforded by the Fourth Amendment, private employers ordinarily do not face the same types of restrictions. Specifically, the federal government does not restrict the right of private employers to engage in testing. In fact, under the Drug-Free Workplace Act, most federal contractors and those receiving federal grants are required to certify that they will provide a drug-free workplace, thereby implicitly advocating drug tests in cases where there is reasonable suspicion of substance abuse. Some states have acted to limit the private employer’s right to test through explicit statutory limitations or because their courts have found privacy protections in either the state’s constitution or privacy statutes. For example, California’s constitution recognizes that citizens have an inalienable right of privacy. While the provision does not explicitly 374 ORGANIZATIONAL DYNAMICS

prohibit restrictions on the conduct of private individuals, in a case involving the National Collegiate Athletic Association, the Supreme Court of California determined that it implicitly provides the protection. One implication of California’s privacy protection is a restriction on a private employer’s right to conduct random testing for the presence of drugs or alcohol. An appellate court found that the employee had a right to sue Southern Pacific Transportation Co. when fired for refusing to submit to a drug test required of all employees. An employer’s desire to deter drug usage to improve efficiency and to insure public confidence were not considered compelling reasons to support a test that intruded into employee privacy. However, even explicit state privacy protections may not apply if it is a pre-employment test that is being administered. Applicants realize that employers may want to know certain information before offering employment, and the applicant has a choice of agreeing to provide the information or seeking employment elsewhere. Therefore, a limited intrusion by Times Mirror Corporation into an applicant’s privacy was found to be acceptable. Alabama, Arizona, California, Florida, Hawaii, Illinois, Louisiana, Montana, South Carolina, and Washington have explicit protections for individual privacy included in their constitutions. However, the courts in states other than California have generally determined that the protection of individual privacy does not apply to private companies. In one of these states, a case involving Nabors Alaska Drilling concluded, an employer may test employees. However, there are statutes in some states that provide some protection of individual off-duty privacy or that explicitly restrict an employer’s right to drug test. For example, Connecticut provides that an employer cannot require a test of an employee unless there is ‘‘reasonable suspicion that the employee is under the influence of drugs or alcohol’’ that may adversely affect on-the-job-performance. One appeals court went further, finding that

an employee can sue for invasion of privacy for a discharge resulting from a refusal to take a drug test. What if employee testing relates to a substance, like alcohol, which is lawful for an off-duty employee to use? Statutes in Arizona, Connecticut, District of Columbia, Illinois, Indiana, Kentucky, Louisiana, Maine, Mississippi, New Jersey, New Mexico, Oklahoma, Oregon, Rhode Island, South Carolina, South Dakota, Virginia, West Virginia and Wyoming broadly prohibit an employer from using such information to make employment decisions. For example, the Illinois statute provides that, ‘‘it shall be unlawful for an employer to refuse to hire or to discharge any individual, or otherwise disadvantage any individual, with respect to compensation, terms, conditions or privileges of employment because the individual uses lawful products off the premises of the employer during non-working hours.’’ In 1990, Congress passed the Americans with Disabilities Act (ADA). The intent of the Act is to prevent employers from discriminating against individuals who, while suffering from physical or mental disabilities, are qualified to do the job if the employer provides reasonable accommodations. The Act has been interpreted as providing protection to recovering alcoholics and former drug abusers. Thus, federal law prevents an employer from using evidence of prior conduct to make employment decisions about either a job applicant or a current employee. Table 1 briefly summarizes the legal restrictions on private employers in their efforts to assess and regulate the off-duty behavior of their employees. For example, the business justification for considering the use of illicit substances in employment decisions is presented with an indication of the statutory restrictions that constrain employers’ policy options.

Cigarette Smoking Employers argue that smokers drive up medical insurance costs and increase absenteeism that negatively affects productivity. For

example, a study of 300 U.S. Airways employees reveals that smokers take nearly three times the amount of sick leave as nonsmokers and have absenteeism significantly higher than ex-smokers. Smokers have been the target of considerable action by employers. In some cases their concern has resulted in a refusal to hire smokers, testing current employees for the presence of nicotine, selecting smokers when lay-offs occur, assessing surcharges on medical insurance, and passing over smokers when promotions are considered. Since constitutional protection of employee privacy ordinarily does not extend to the private employment relation, the private worker who smokes is not offered constitutional protection. Indeed, at least one federal appellate court has found that even public employees have limited privacy rights on these issues. A state court in Oklahoma found that Oklahoma City did not violate the due process clause by banning off-duty smoking. However, trouble could be looming for managers who decide to make employment decisions based on tobacco use. Some legal scholars have presented the argument that federal employment discrimination statutes provide protection for some smokers. For example, Title VII of the Civil Rights Act bars discrimination based on race, and evidence exists that a greater percentage of African-Americans smoke than whites. This could be interpreted to mean that a policy barring off-duty smoking violates the Act because it has the potential for disqualifying a larger percentage of African-Americans. Additionally, smoking has been recognized as potentially addictive. The U.S. Surgeon General has compared nicotine addiction to addictions suffered by heroin and cocaine users. If smokers are addicted to nicotine, the question arises whether they can be considered disabled under the terms of the Americans with Disabilities Act. While the Act does not specifically deal with the protection of addicted smokers, an argument can be made that such is the intention, since the legislative history of the Act makes it 375

TABLE 1

LEGAL RESTRICTIONS ON OFF-DUTY BEHAVIOR OF PRIVATE EMPLOYEE

OFF-DUTY BEHAVIOR OF PRIVATE EMPLOYEE

BUSINESS JUSTIFICATION

STATE STATUTORY RESTRICTIONS ON EMPLOYER POLICY

Illicit drug use

Concern that worker may come to work impaired jeopardizing the worker’s safety and the safety of other workers Quality of work of impaired worker may affect the product or service provided by the company which, in turn, can affect the business’ reputation and profitability Conduct is illegal and not deserving of legal protection

46 states allow employers to test for illicit drugs

Alcohol use

Same justifications as applied to those who use illicit drugs, except for the issue of legality

40 states allow employers to regulate off-duty alcohol consumption

Cigarette smoking

Smokers increase employer’s health care costs and affect productivity by missing more work due to illness than nonsmokers

22 states allow employers to prohibit off-duty use of tobacco products

Use of weight standards

Same justifications as apply to smokers

49 states allow employers to establish weight standards that do not violate the ADA

Dating between employees

A romantic relationship between employees may affect their productivity The relationship could lead to sexual harassment charges against the employer, especially if one employee is a supervisor of the other Other employees may believe that an involved supervisor is showing favoritism and may then feel that they are victims of discrimination

48 states allow employers to regulate dating between employees

Moonlighting

Working too many hours may impair worker’s productivity Working for a competitor could jeopardize privacy of employer information

48 states allow employers to regulate moonlighting

Social relationships with employees of a competitor

Concern that information could be exchanged that would cause harm to the business

48 states allow employers to regulate

clear that Congress intended to cover those suffering from other types of addiction, including cigarette smoking. Several states have moved to protect offduty cigarette smoking. Illinois, Wisconsin and Nevada protect an employee’s right to use any legal product, like tobacco, when not on duty. Rhode Island explicitly prohibits an employer from banning workers’ use of tobacco products outside the course of 376 ORGANIZATIONAL DYNAMICS

employment and also prohibits the employer from using an employee’s status as a smoker to discriminate with respect to compensation, terms or conditions of employment. A few states focus privacy protection on activities of off-duty employees rather than on the products that they use. For example, Colorado provides that generally it is unlawful, ‘‘for an employer to terminate the employment of any employee due to the

employee’s engaging in any lawful activity off the premises of the employer during nonworking hours.’’ Exceptions are permitted if there is a bona fide occupational qualification justifying the termination, where the restriction is related to the employee’s responsibilities or where the off-duty conduct poses a conflict of interest. For example, if a nonprofit organization has as one of its objectives the elimination of tobacco use, it would be justified in hiring only nonsmokers. Likewise, an employer would likely have the right to bar an employee from working for a competitor. New York goes further by providing that it is unlawful to refuse to hire or to discharge or otherwise discriminate because of an individual’s off-duty legal use of consumable products. However, the statute does allow an employer to assess differential costs to employees on their health, disability and life insurance because of employees’ use of consumable products, specifically cigarettes.

Weight Employers have documented evidence of the dangers that drug and alcohol abuse and tobacco usage pose to both the health of workers and the profitability of the business. However, less well confirmed suspicions exist regarding an individual’s weight, and its link to company consequences. What information is an employer allowed to seek regarding an employee’s weight? How can the information be used? Certainly, the weight of individuals can have a large impact on their health. For example, overweight employees have an increased incidence of breast and endometrial cancers and heart disease. Should employers have the right to impose sanctions, including possible termination, on employees who fail to keep their weight within specified limits? It is clear that employers do terminate overweight employees and refuse to hire individuals who are overweight. Employers have also successfully charged higher health insurance premiums for those who fail to meet certain weight guidelines, while com-

panies have tried to affect diet by providing incentives to workers who control their weight or cholesterol levels. In some instances, employers are protected in such actions by law or at least by the absence of laws that prohibit them. For example, the rights of an employee who does not meet employer weight guidelines are unclear, since federal law does not offer explicit protection. Specifically, Title VII of the Civil Rights Act does not prohibit discrimination based on weight. However, an employer can run afoul of the law when a standard on weight has a disparate impact on members of a class protected by the Act. For instance, if the weight standard serves to disproportionately disqualify a larger number of women (a protected class), members of that group may have a right to challenge the standard. The Americans with Disabilities Act and the Rehabilitation Act of 1973 do not offer explicit protection for the overweight. As a result, the extent of protection is left to a court’s interpretation of whether Congress intended for extreme weight to be considered as a disability. The First Circuit Court of Appeals reviewed a case in Rhode Island arising under the Rehabilitation Act where an individual was rejected for employment because of morbid obesity, even though there was no evidence that she was unable to perform the duties of the job. Since the Rehabilitation Act, like the ADA, protects both those who are disabled and those who are perceived as disabled, the employee argued that it was the employer’s perception that caused her to be denied employment. The court found that she did have a right to bring suit under the Act. It recognized that her morbid obesity had an underlying cause related to the fact that her metabolism was not functioning properly and that her condition was permanent. However, this decision offers no protection to the individual whose weight prevents performance of the essential functions of the job. The decision also has no bearing on an individual who is overweight but whose condition is not tied to a physiological disorder. 377

Disability laws in 50 of the 51 states do not explicitly prohibit an employer from discriminating against an individual because of weight. The exception is Michigan. Thus, in other states, the individual claiming weight discrimination must prove that the condition is one that the legislature intended to include under the disability statute and that the employer is not justified in using a person’s weight in making a decision. This can be a difficult task for the employee. For example, the U.S. District Court in the State of Washington, in a case involving the Union Pacific Railroad, found that state law did not intend obesity to be considered as a disability. The court pointed out that excessive weight is not an immutable condition such as blindness. On the other hand, some courts have found that disability laws in some states are intended to provide protection for overweight employees. For example, in a case against Community Foods, Inc., the California Supreme Court found that weight can be a basis for a claim when the plaintiff is able to show that the condition is tied to an underlying physical cause, actual or perceived. Similarly, in cases against Xerox Corporation in New York and against Agency Rent-A-Car Systems, Inc. in New Jersey, courts found that obesity is a disability, whether or not it is immutable. Even if a court believes that a state’s disability statute intended to cover weight, an employer’s decision to establish weight standards would likely receive a sympathetic review where the employer can show the physical demands of the job or the safety of others justifies the standard. This argument was supported when a California state court rejected a claim brought by an obese paramedic. The court found that even if obesity can be considered a disability, discrimination was not improper in that case because it was tied to a legitimate occupational qualification. Employer inquiries into an employee’s medical information can also lead to invasion of privacy actions under state law. In a case involving IBM Corp., a supervisor received 378 ORGANIZATIONAL DYNAMICS

information on an employee from an outside physician who was under contract to the company. The supervisor discussed this information with managers at IBM and distributed a memo to others regarding the contents of the medical report. The Supreme Court of Massachusetts recognized that under the state privacy statute, an employer’s disclosure of employee facts to others can constitute sufficient publication to violate the individual’s privacy.

Interpersonal Relationships Do employers have the right to establish policies that seek to control employees’ offduty relationships with others? Are policies legal that place constraints on employee dating, marrying, associating with controversial groups, or holding second jobs? If so, how much power do employers have to enforce their policies? Some employers have adopted dating policies aimed at regulating relationships between employees. Employers recognize that such relationships can pose a variety of problems. First, if the employees work together, a dating relationship can affect productivity. A further problem can be posed if the relationship ends and one party engages in conduct that impacts the other. This can affect not only their ability to work together, but also the productivity and morale of others who work with them. These policies often receive the support of the courts. In the State of New York, the court concluded that Wal-Mart Stores was within its rights in terminating two employees who were dating in violation of a company policy that prohibited a married employee from dating any employee other than his or her spouse. Perhaps the bigger concern for the employer is that the conduct can give rise to circumstances where an employee can sue the employer under Title VII. The Supreme Court has concluded in a suit brought against Forklift Systems, Inc., that if an employee engages in unwelcome conduct that creates a hostile or abusive work environment for another, it can be considered as sexual

harassment, which is a form of sex discrimination. If the employer fails to take measures to prevent this conduct or if it fails to deal with the harasser, the employer can face liability under Title VII. Reported sexual harassment most often occurs when one employee has power or authority over another and abuses that power when the other either acts to rebuff an initial overture or acts to end a relationship. However, the employer’s risk is also present even if one employee does not have power or authority but still engages in conduct that creates a hostile work environment. More challenging for the employer is the possibility that an employee can sue the employer even though the conduct is not directed at the complaining employee. This situation commonly arises when a complaining employee contends that a dating relationship between a supervisor and another employee led the supervisor to favor the romantic partner and discriminated against the third party in the granting of rewards such as assignments, raises or promotions. Employers who discharge employees for off-duty social relationships also face the potential of being sued for wrongful discharge or invasion of privacy. In a suit involving IBM, a female employee was fired because of an alleged conflict of interest posed by a dating relationship she had with an individual who sold the products of a competing company. She claimed that she was wrongfully discharged and also sued in tort for the intentional infliction of emotional distress. The court found that the company had a formal policy that expressly protected employees’ rights to privacy, and the right to engage in off-duty conduct that might not be acceptable to the employee’s manager. Although there was also a policy that detailed the company’s right to prevent conflicts of interest, there was no explicit policy against an employee socializing with the employees of a competitor. In finding for the employee, the court focused on the company’s privacy policy and the fact that the company had failed to demonstrate that her relationship constituted a threat to the employer’s interest.

Other cases have recognized that an employer has a legitimate right to be concerned about a dating relationship between one of its employees and an individual who works for a competitor. In a Massachusetts case, the fiance´ e of a Laidlaw Environmental Services, Inc. employee went to work for a competing company. The employee was given an ultimatum to resign or force his fiance´ e to resign. If he did neither, he was to be terminated. The court concluded that the state law did not provide protection for the right of an at-will employee to marry. An Alabama state court similarly found that termination of an employee for deciding to marry was not prohibited where an employment-at-will relationship existed. Some state statutes prohibit discrimination based on marital status. In these states, an employer cannot bar or otherwise penalize two qualified employees simply because they are married to each other. In a twisted example, a married employee’s claim of invasion of privacy was upheld after he was fired from United Parcel Services, Inc. for adulterous behavior. Since the company’s policy pertained to adulterous behavior by married employees, and not single employees, the court concluded that the policy discriminated based on marital status. A different result could be reached if the company policy prohibits both a single and a married employee from engaging in an adulterous relationship since it would not discriminate based on marital status. Exactly such a case resulted in a decision in favor of Federated Rural Electric Insurance Company. In other instances, employers have found that examining the off-duty conduct of their employees can constitute an invasion of privacy. In a case in Alabama, an employer questioned a worker on several occasions regarding her sexual conduct with her husband. The court found that this questioning constituted an invasion of privacy. However, the courts do not always offer protection for dating relationships, two unmarried people cohabiting, or parties involved in an extramarital sexual relationship. 379

The law has generally not afforded the same protection to the homosexual employee that it has provided to others who may be victims of prejudice. Specifically, the courts have concluded that Congress did not intend to provide protection for homosexuals under Title VII of the Civil Rights Act. The Supreme Court has found that the constitutional right of privacy does not cover sexual conduct between parties of the same sex, and it permitted the state of Georgia to define such conduct as criminal. However, a small number of states and over half of the 50 largest American cities have created laws that prohibit discrimination based on sexual orientation—homosexual, heterosexual, or bisexual behavior. These laws may not apply to transvestites and frequently provide exemptions for employers who are affiliated with a religious organization or to those organizations whose primary objective is to provide services to minors.

Conduct Threatening the Business’s Competitive Position Does an employer have the right to restrict employees’ off-duty conduct that the employer feels threatens the welfare of the business? For example, can managers prevent employees from moonlighting (working second jobs), or engaging in other conduct because the managers believe that the action has some potential to damage the company’s reputation? In the case of supplemental employment, an employee who is working a second job poses a potential for problems for the employer. The courts have recognized the legitimacy of a concerns that the worker’s performance will suffer in trying to maintain two jobs, and that there is also the possibility that in some settings other workers may face an increased risk of injury because of the diminished capacity of the worker. An employer may also want to prevent an employee from working for a competing firm or for any other firm where a conflict of interest is created. In one instance, Tribune 380 ORGANIZATIONAL DYNAMICS

Publishing Company terminated a drama critic because she worked a second job as a press agent for summer theater and allowed her name to be used in promoting the theater. The arbitrator concluded that this second job clearly created a conflict regarding her responsibility to the primary employer and upheld the dismissal. In another instance, meat department employees of Country Club Markets, a small grocery store chain, opened a competing meat market. The arbitrator upheld the indefinite suspension of the employees because their conduct clearly indicated that their loyalties were divided. However, working a second job is not usually sufficient to justify a discharge. An employee of Continental Telephone Company of Virginia was terminated for installing phones on his own time. The employer contended that the conduct was detrimental to the company. However, the arbitrator ordered the installer reinstated, after finding that there was no evidence that company operations were adversely affected due to the consequences of the employee working two jobs. What if there is the potential that an employee’s off-duty conduct can embarrass the company, causing potential damage to the business? The employee who decides to go public with information of a business’ wrongdoing may be entitled to protection under a state’s whistle-blowing statutes or under a recognized exception to the employment-at-will doctrine. However, if the employee’s behavior does not fall within this type of conduct, the employer may possess the power to discharge a worker. For example, an employee of Six Flags Over Texas lost a suit to keep his job when he was dismissed pending criminal charges involving statutory rape. In another case, an employee of United Parcel Service, Inc. was denied reinstatement after being acquitted on theft charges relating to his employment for the package delivery service, because his employment threatened his employer’s need to assure customers that packages were safe while in the company’s care. In a third instance, Canadian Pacific Airlines was allowed to dismiss employees who were arrested on illegal drug charges

because of the potential damage to the reputation of the employer.

CONCLUSIONS Managers want information that that will help them to hire and promote individuals whose lifestyle, character and employment and medical histories indicate that they will not create extraordinary risks for the company. Such precautions are important to the company’s profitability, the workers whose safety and welfare may depend on each other, and for those who will either have contact with the employee or the work that they do. A company that is able to select employees who have healthy habits and do not engage in off-duty activities that adversely affects their productivity, has improved its chances of maintaining its competitive momentum. While such motivation is understandable and even laudable, it raises questions regarding efforts that intrude too deeply into

individual privacy. Certainly, statistics do support the idea that smokers and the overweight increase medical insurance costs for employers, and interpersonal relationships both on and off-duty can endanger morale and proprietary information. However, the legal system has taken steps to temper an employer’s desire to gather and use information on off-duty behavior in making employment decisions with the employees and job candidates’ right to be judged on job performance. Managers, therefore, need to consult federal, state and local laws to prevent unintended violations of employee rights. As the forgoing discussions reveal, managers enjoy great latitude in exploring and restricting employees’ off-duty behavior, but limits have been set in areas of illicit substance abuse, cigarette smoking, weight, and interpersonal relationships, and the legal system demands that they be respected.

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SELECTED BIBLIOGRAPHY Many of the conclusions presented in this article are based on state and federal court cases, laws, and legislation, which are not specifically referenced herein. For a complete listing of these sources, please contact the authors. To read details of the American Management Association survey, refer to ‘‘Forward Planning: Workplace Privacy is at Risk Everywhere’’ by S. Al Halayn in the Financial Times Information, August 5, 2002. To learn more about the study of smokers conducted at U.S. Airways, see ‘‘Smokers Take More Sick Leave—Study,’’ by S. Westcott in The Press Association Limited, September 5, 2001. For articles that address the general topic of off-duty employee privacy, read ‘‘Invasion of Privacy in the Private Employment Sector: Tortuous and Ethical Aspects,’’ by F. J. Cavico in the Houston Law Review, Fall 1993, 1263– 1346; ‘‘Privacy in the Workplace,’’ by K. Conlon in the Chicago-Kent Law Review, 1996, 285– 296; ‘‘It’s My Life—Leave Me Alone: Off the Job Employee Associational Privacy Rights,’’ by T. M. Dworkin in the American Business Law Journal, Fall 1997, 47–103; and ‘‘The Disparity Between Public and Private Sector Employee Privacy Protections: A Call for Legitimate Privacy Rights for Private Sector Workers,’’ by L. B. Pincus and C. Trotter in the American Business Law Journal, Fall 1995, 51–89. For additional material on alcohol abuse and the workplace, see ‘‘Study of off the Job Drinking Raises Troubling Issues,’’ by M. Payne in the Seattle Post-Intelligencer, September 23, 2002, E-3; and ‘‘Businesses Pay Big

Price When Employees Abuse Drugs, Alcohol,’’ in the Environmental Laboratory Washington Report, August 15, 2002, 13(15). Articles that address the issue of smoking include ‘‘If You Light up on Sunday, Don’t Come in on Monday,’’ Business Week, August 26, 1991, 26, 68; ‘‘The Emergence of Employees’ Privacy Rights: Smoking and the Workplace’’ by A. M. Kramer and L. F. Calder, Labor Lawyer, Spring 1992, 313–333; and ‘‘ ‘Smokers Need Not Apply’: Challenging Employment Discrimination Against Smokers under the Americans with Disabilities Act,’’ University of Kansas Law Review, Spring 1991, 817–843. To learn more about weight issues, read ‘‘An Analysis of Weight-Based Discrimination: Obesity as a Disability,’’ by T. Johnson and M. C. Wilson in Labor Law Journal, April 1995, 238–244; ‘‘Sizism—One of the Last ‘Safe’ Prejudices,’’ by S. E. Smith, in California NOW Activist, July 1990, 1; and ‘‘Nature or Nurture, Lifestyle or Fate: Employment Discrimination Against Obese Workers’’ by P. Hartnett in Rutgers Law Journal, Spring 1993, 807–845. Our principal sources on sexual harassment are ‘‘A Business Policy Statement Model for Eliminating Sexual Harassment and Related Employer Liability,’’ by J. A. Pearce II and S. A. DiLullo in Advanced Management Journal, 2001, 66(2), 12–21; and ‘‘Invasion of Privacy or Protection Against Sexual Harassment: Co-Employee Dating and Employer Liability,’’ by K. M. Hallinan, Columbia Journal of Law and Social Problems, Spring 1993, 435–464.

John A. Pearce II, Ph.D. is the Villanova University endowed chair in strategic management and entrepreneurship. He is the author or coauthor of more than 90 articles and 120 professional papers. Among Pearce’s 28 books are Strategic Management: Formulation, Implementation, 382 ORGANIZATIONAL DYNAMICS

and Control (Irwin, 2003) and Strategy: A View from the Top (Prentice Hall, 2003). This year, he received the Villanova University Outstanding Faculty Research Award, which is presented annually to one professor from any of the University’s six colleges in recognition of a body of distinguished scholarship. The first chairman of the Academy of Management’s Entrepreneurship Division, and a past president of the Southern Management Association, Pearce currently serves on the editorial boards of four prominent management journals. A frequent leader of executive programs, expert witness, and active business consultant, Pearce concentrates his work on critical issues in strategic planning and management. Specific topics include strategy formulation, implementation, and control, mission statement development, environmental assessment, industry analysis, organizational turnaround, and tools for strategy evaluation and selection. He can be contacted at the College of Commerce and Finance, Management Department, Villanova University, Villanova, PA 19085; Internet: [email protected]. Dennis Kuhn, J.D., LL.M., is currently an associate professor of business law in the College of Commerce and Finance at Villanova University. He earned his J.D. from American University in 1973, and his LL.M. in 1979 from Georgetown University. While practicing law, he spent several years representing public employee labor organizations. His primary teaching responsibilities are in the field of government regulation and the impact on business activities. His research focus has been in the field of labor law and public policy, with articles published in such journals as Labor Law Journal and Law and Policy. He has also authored a chapter in Readings in Business Law and the Legal Environment of Business (Douglas Whitman, ed., 1994).

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