PUBLICATIONS

Labor Law Update | September 2019

Employer Forced To Pay Compensation To An Employee Due To Damages Caused By The Violation Of The Employee’s Privacy

 

Dear Valued Clients,

We would like to update you on a recent ruling, 60161-06-16 Kelly Blackar v. Gershon Belkin (Tel Aviv) (Published in Nevo, 27.08.2019) (hereinafter – “Kelly Blackar” case) in which a local Tel Aviv Labor Court ordered an employer to pay an employee 50,000 NIS for breaching an employment agreement and for violating the employee’s privacy by monitoring its employees’ computer activities during work.

In our opinion, this ruling emphasizes the importance that the Labor Court places on employees’ privacy at the workplace, and the risks associated with an employer who violates employees’ privacy rights.

Over the years, the well-known Isakov [1] and Hamias [2] rulings, have helped to provide clear rules and guidelines in connection with methods that may be used for monitoring employees at the workplace, as well as the employer’s duty to inform employees’ if monitoring procedures are established. The Kelly Blackar case is an example of what happens when an employer does not adequately follow the courts’ guidelines.

The case began when the employee sued the employer for failing to pay various employee compensation payments for the work performed by the employee.

In response, the employer filed a lawsuit in a separate proceeding (which was later consolidated into one employee claim), in which the employer explained that surveillance software had been installed in an attempt to monitor the digital activities performed by its employees, including: internet traffic, websites visited by the employees, and the content viewed by the employees. The employer did not present the employees with any prior notice, and did not formally adopt a computer monitoring policy.

The employer claimed that the monitoring software showed that the employee was performing tasks unrelated to work, at the expense of the employee’s working time, while using the employer’s resources, and that the employee had even stolen documents from the employers office.

The employee filed a counterclaim in response to the counterclaim brought by the employer for the breach of the labor agreement and the violation of the employee’s privacy, by virtue of the Privacy Protection Law, 1981 (hereinafter: the “Privacy Protection Law”).

The Labor Court ruled in accordance with the rules established in the Isakov and Hamias cases, that the documents and evidence obtained from the monitoring software were invalid and therefore could not be used as part of the proceeding against the employee because they had been obtained in an illegal manner. The employer never introduced a Company monitoring policy and did not provide any notice to its employees (i.e., present any document stating that the Company would be monitoring the employees’ computer activities). As a result, the Court rejected the employer’s claim in its entirety.

The Court held that the use of the monitoring software violated the employee’s privacy, and as a result, the employer was obligated to compensate the employee in the sum of NIS 50,000.

This ruling reinforces the position that we at GKH consistently advise our clients: that when considering employee privacy in the digital age, the position of the Labor Courts can provide a double safeguard for employees if an employer does not follow the court’s guidelines. Firstly, evidence that are received through the privacy violation will be excluded. Secondly, as we see in Kelly Blackar, the courts can take action against the employers and have them pay substantial financial compensation.

The outcome of this ruling may have been different had the employer established an employee computer monitoring procedure and notified the employee of the policy. If the employee signed the policy, this would have strengthened the employer’s case even further.

We strongly recommend that our clients establish a policy and inform their employees before any monitoring is carried out.  We also suggest that even in cases where the employees give their consent that everything is done in complete compliance with the legal requirements.

We at GKH are available to consult with you on drafting an effective policy, to assist as to how to implement and maintain it, and to provide counsel when unique situations arise.

Please note that this ruling did involve a unique jurisdictional overlay   – the Court itself stated in its ruling that it does not adhere to the Privacy Protection Law because it has no authority to do so. Thus, the grounds for the actual ruling are breach of privacy. Therefore the national court may change the outcome of the judgment if an appeal is filed.

 

 [1] 90/08 (Artzi) Tali Isakov Inbar v. State of Israel – Commissioner of Law for Women’s Work et al. (Published in Navo 8.2.2011)
 [2] RA 2552/16 Yehuda Singer et al. V. Yahav Hamias Technologies Company (1990) Ltd.

 

For more information regarding this newsletter update, please contact the GKH Labor Department at
03-6074800; Attorney Yael Dolev, Head of the Labor Law Department email: yaeldo@gkh-law.com ; or Attorney Idan Fefer email: idanf@gkh-law.com


Gross, Kleinhendler, Hodak, Halevy, Greenberg, Shenhav & Co. (GKH), is one of the leading law firms in Israel, with over 170 attorneys. GKH specializes, both in Israel and abroad, in various fields of law including Mergers and Acquisitions, Capital Markets, Technology, Healthcare and Life Science, Banking, Real Estate, Project Finance, Litigation, Antitrust, Energy and Infrastructure, Environmental Law, Intellectual Property, Labor Law and Tax.
This alert is prepared as an informational service to clients and colleagues of Gross, Kleinhendler, Hodak, Halevy, Greenberg, Shenhav & Co. (GKH) and the information presented is not intended to provide legal opinions or advice. Readers should seek professional legal advice regarding the matters about which they are particularly concerned.

Yael Dolev

Phone +972-3-607-4800

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Idan Fefer

Phone +972-3-6074800

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