Using employees' emails against them

Monday, May 18, 2009

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Two Bear Stearns executives learned a hard lesson this week: If you're going to say something inappropriate, don't write it in an email.

An online exchange between fund managers Matthew Tannin and Ralph Cioffi questioned the performance of certain funds in which they were investing clients' money. But their public comments told a different story, and now those emails are the smoking gun in the civil and criminal cases against them. If convicted of conspiracy and securities fraud, the two could face jail time and heavy fines.

Will employees ever learn that anything they write in an email can and will be used against them?

"This stuff is obtainable, and it's difficult to deny once it's printed out," says Josh Bowers, a labor lawyer in Washington, D.C.

Of course, we're not encouraging you to behave illegally offline, either. But the risk of getting caught online is high. Employees send hundreds of emails daily from their work computer, and experts say they too often broach subjects that should be avoided. The most common? Sex.

Many employees write emails or forward jokes with sexual overtones. On the one hand, forwarded jokes are usually meant to be harmless. The danger comes, however, if a complaint against the sender is filed that may have nothing to do with the inappropriate emails. For example, a manager who is unhappy with her employee's ability to meet deadlines might ask IT to monitor his email transactions. It's only then that the sexual emails come to light, which provide reason enough to fire an employee or even prompt legal action.

"Those emails can be used to show a pattern of harassment," says Matthew Blit, a labor lawyer with Levine & Blit in New York City.

Discrimination is another dangerous topic. Blit recalls a case in which a female employee filed a lawsuit against her employer, claiming it didn't protect her from sexual and racial discrimination. As part of the discovery process, the employer examined her outbox, and what they found seriously hurt her case. She forwarded dozens of jokes containing sexual and racial content to her brother and mother from her work computer.

"The attorney said, 'You're complaining you were discriminated against, but here you are sending them out yourself. Isn't that correct?' " Blit says.

It's an important message: Nothing written from your work computer - even if it was sent from a personal email address - is private. Most employee handbooks include an electronic communications policy stating that any correspondence sent from an employer-owned computer belongs to the company. Before starting a job, most companies require new employees to sign the handbook and return it to human resources to prove that they've read and agree with it.

And technology allows employers (and prosecutors) to retain messages sent years ago. Some employers periodically scan employees' email for certain key words, like profanities, or other vocabulary that could denote violence or harassment.

Labor lawyer Patrick Boyd encourages all employees to implement what he dubs "the grandmother test." If a topic is too embarrassing to share with your grandmother, don't send it. It's a tough guideline to follow, since our work and personal lives are so intertwined. We receive emails from family members while at the office and respond offhandedly between assignments. A lax attitude toward email seeps into our interoffice communication, too.

"That's dangerous," Boyd says. "When you communicate something, even though you did it after giving the topic 30 seconds of thought, it can be used in a court of law years later. email is perceived as casual, and it should not be."

Even a confidential exchange between an attorney and a client isn't protected if an email is sent from a client's work computer to her lawyer.

The Bear Stearns executives are just the latest in a long line of employees who've drawn negative attention--and legal trouble--for inappropriate emails.

Take Frank Quattrone, the investment banker from Credit Suisse First Boston who sent an email to his staff with the subject line: "Time to clean up those files." The note referred to the firm's practice of discarding certain files and memos. Quattrone's conviction was later overturned.

In 2002, Merrill Lynch paid $US100 million to settle a lawsuit because its analysts were making certain statements about stocks in public but whispering others behind closed doors. The private comments didn't stay that way after analyst Henry Blodget's emails were uncovered. He had given stocks "buy" ratings, but his correspondence showed he actually thought they were a "piece of junk."

More recently, the head of mortgage lender Countrywide, Angelo Mozilo, intended to send a colleague a note deeming a borrower's plea for help "disgusting." Instead, he directed the email back to the borrower. When the borrower went public with the news, the company was forced to confirm that the email was indeed from its CEO.

It's unlikely that particular email would have passed the grandmother test. But everyone else's definitely should.

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