Legislature(1997 - 1998)
04/24/1998 01:07 PM House JUD
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
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HB 319 - EMPLOYEES: NO EXPECTATION OF PRIVACY Number 1638 CHAIRMAN GREEN announced the next order of business would be HB 319, "An Act relating to an employee's expectation of privacy in employer premises," sponsored by Representative Rokeberg. REPRESENTATIVE ROKEBERG presented to the committee CSHB 319(L&C). He said the bill is relatively simple which merely puts in statute - to clarify any question about the ability of an employee/employer relationship in this contemporary age of electronic commerce, particularly - about the expectations of privacy on the part of an employee and employer. He pointed out that one of the main objectives he had in introducing this bill is to get business enterprises to memorialize policies about their telecommunications equipment and other property. He said that is the custom in many instances with many businesses today. He said on the record is the state of Alaska's policy which has set forward many other major corporations regarding this type of use of equipment. He noted that the bill was amended in the Labor and Commerce Committee to overcome some of the problems that arose out of the testimony. He said the germ of the bill revolved around a lawsuit that occurred in the University of Alaska Fairbanks where an employee was accused of downloading pornographic materials on a university-owned computer. As a result, there was a dispute about the expectations of privacy between the employee and the employer. Unfortunately, this bill would not have helped in that particular situation because when it was discovered that the employee had the material, the material was on his personally-owned zip drive attached to his computer on an external basis; not an internal drive. Strictly speaking, it was his property and, therefore, this wouldn't have happened. REPRESENTATIVE ROKEBERG noted in the Labor and Commerce Committee they took up the issue of the business premises as it related to a camp job where an employee may be in a residential setting on company-owned premises. By using the term "business property" in the bill, legislative counsel advised him that HB 319 will exclude residential domiciles. The bill only refers to business equipment and business premises. It's the intention of the bill that it not include situations where there is employee housing. He referred to a memorandum from the Division of Legal and Research Services, Legislative Affairs Agency, dated March 25, 1998, regarding any issues that revolve around constitutionality. It seems clear from the memorandum that there is no intention to hinder a person's constitutional right of privacy. Number 1815 REPRESENTATIVE BUNDE asked if someone's personal computer equipment would not be covered by this bill because it's personal property and not employer property. REPRESENTATIVE ROKEBERG replied in the affirmative. CHAIRMAN GREEN asked if a person was doing work at home and their computer was tied into their place of employment, could they be subject to review of their own personal computer. REPRESENTATIVE ROKEBERG replied, "No." Number 1863 REPRESENTATIVE JAMES said she has a severe concern about this issue because every year, except for the first year she was in office, she has provided her own computer, since the legislature did not provide one for her. She said every year, if she connects to the Local Area Network (LAN), she has to have the state do that for her. She informed the committee that last year, legislative counsel made a decision that they would only connect those pieces of equipment that were purchased by the state. She said this year she purchased another computer, which she paid for, and purchased it through the state so that she could be connected to the LAN and have service on her computer. She said she is very careful because she doesn't trust the state and other people to say that anything that is on her computer isn't reviewed by the public. She noted there have been extensive hearings on the ethics bill regarding the Alaska Public Offices Commission and the State Affairs Committee. Representative James pointed out that the State Affairs Committee shied away from adding E-mail in to some of the things you can and can't do in the state business because it is assumed that people will be sending private E-mail messages. If they included E-mail it may be that those messages would be subject to review. She explained that it's her personal feeling that those things should not be subject to review by the state or other government entities. She stated, "Certainly, it would have a chilling effect on people such as myself, who, in order to have a computer have had to provide my own. And I think it would be absurd for me not to be able to use a computer while I'm here." She indicated she does not know exactly what HB 319 does. It sounds like the bill says she has absolutely no protection whatsoever. Representative James referred to page 1, subsection (b) noting that the bill indicates that some people are excluded from this: "(b) An elected official is not an employee for purposes of this section." She asked, "What's the reason that we're not? If we're being paid for with state funds, is that the issue? What is the issue?" Number 1973 REPRESENTATIVE ROKEBERG emphasized that he should have made very clear to the committee that the bill does provide for a contractual agreement to the contrary between an employee and employer to allow the employee to maintain that level of privacy. He said the thrust of the bill is absent a contract, to the contrary the employer has the right to look at the equipment and premises, which is the property of the employer. He commented he would think by now that this is basic common law, but it's being called into question because of the changing dynamic of the electronic commerce, et cetera. Therefore, the bill specifically provides for that contract. He indicated that one of his purposes in the legislation was to make sure that there is a policy and/or contract in place that specifies the rights of the employees/employers on these issues. He noted that many companies and corporations have these policies and this bill will allow for an individual contract to protect those individual rights. He said he looks at this as a protection of privacy on the part of the employee more than anything else. He believes this is a real positive aspect of the bill. REPRESENTATIVE ROKEBERG said this bill does not, in any way, hinder our constitutional rights under our constitution. He referred to the provision in subsection (b) regarding "elected official" stating that it was put in there for the very fact pattern Representative James just described. He said, "It's my understanding ... when we, as members of this legislature, use our services here, when we bring our own computers in, we connect to the LAN onto the server that is readily available - anytime you're on that LAN and that circuit into the server, your data and information can be easily and readily inspected by the Department of Administration data processing people." He stated that it is absolutely unsecured. The only way a person can have a secure line in the Capitol Building is if they have a separate dedicated circuit that they can connect to the Web or through another server that is not on the state server. He indicated a person has absolutely no security if they are connected into the state server. REPRESENTATIVE ROKEBERG referred to a memorandum from him dated March 27, 1998, regarding questions that were asked regarding legislative policy during a Labor and Commerce Committee meeting. He pointed out that the members of the Labor and Commerce Committee added the exemption of an elected official in the bill. He said he particular doesn't care for this exemption because it gives the inclination that elected officials are better than anyone else. He commented that if the Judiciary Committee wanted to take that exemption out of CSHB 319, it wouldn't bother him a bit. Number 2155 REPRESENTATIVE PORTER said he had the same reaction regarding the exemption of an elected official because legislators would not be able to enter into a contract with their employers back home. REPRESENTATIVE ROKEBERG remarked that was the exact discussion they had in the Labor and Commerce Committee stating, "Who is our employer?" He said they don't work for anybody but their constituents, and that is the reason they added that exemption to clarify that elected officials are not employees. REPRESENTATIVE JAMES interjected and said she gets her paycheck from the state of Alaska. REPRESENTATIVE ROKEBERG said he would venture to say that all 60 legislators would say that they work for the people and not the state of Alaska. He said, "I am not employed by the state of Alaska." REPRESENTATIVE BERKOWITZ referred to the discussion about legislators using their own equipment and said it seems that this bill would apply if a person is working for a private corporation as well. REPRESENTATIVE ROKEBERG replied, "That's correct and that's why you should have a contract allowing you to do such things." REPRESENTATIVE BERKOWITZ asked if this bill applies to telephones also. REPRESENTATIVE ROKEBERG said the bill refers to employer equipment and premises in the (indisc.). He said, "If it's personally owned, then the title of it belongs to you. The question then becomes what about the data line that you're connecting it to." REPRESENTATIVE BERKOWITZ said his concern with that is his privacy is not in the telephone, it's not in the computer; his privacy is in the information that's transmitted or stored in one of those devices. And by placing a distinction as to who owns the mechanism by which he communicates seems somewhat artificial to him. Number 2240 REPRESENTATIVE ROKEBERG said, "For example, even in the case at bar now regarding that, the distinction is made and clearly conceited that the zip drive is under title to the accused and, therefore, he had an expectation of privacy, so you couldn't invade that storage. Data storage is the issue in large part, other than direct eavesdropping because so much data now is stored in a memory." CHAIRMAN GREEN said it seems reasonable that if legislators be warned that it is state equipment and they are not allowed to use it for personal use. If they don't have something that is suspect, there shouldn't be any problem in making public what they have said. REPRESENTATIVE ROKEBERG pointed out that all legislators' transmissions are monitored constantly. REPRESENTATIVE BERKOWITZ again referred to telephones. He said if he is on a state telephone or if he's in a private business and he's talking on the telephone, the way he reads this bill is that he has no expectation of privacy in that conversation. However, if it's his own personal telephone, then he does have an expectation of privacy, regardless of the conversation. REPRESENTATIVE ROKEBERG said a person's protection is in the contract and that's what is positive about this bill. Number 2305 REPRESENTATIVE PORTER remarked that Representative Berkowitz has a very valid point. He said the wording of the committee substitute (CS) as currently written brings into question what everyone has an expectation of privacy on, which includes telephone calls. He indicated he feels it could be handled very easily with a little "blip" that nothing in the bill is intended to preclude the expectation of privacy in telephone conversations. REPRESENTATIVE ROKEBERG stated that it's his understanding in other testimony that it is legally permissible to eavesdrop on an employee's telephone communications. He noted it's a very common marketing device, whereas employers listen to sales calls to gage performance. He pointed out that there's no protected right for that particular activity. He said, "If we were to do something otherwise, we would be making a mistake. There's no common law right to that when we're talking about business activity." REPRESENTATIVE BERKOWITZ explained that there is an advisement that your privacy may not be there. REPRESENTATIVE ROKEBERG said he is not absolutely certain about the statement he just made regarding privacy in telephone calls, but he suspects that there's no constitution or statutory right. He noted there is a common law right of no expectation of privacy on telephonic communications when it's in a business center. Number 2378 REPRESENTATIVE JAMES said she is also concerned with privacy in telephone calls because before computers there were telephones. She said, "Not every telephone conversation that you have, you instituted it. They call you many times." She expressed that even though we are moving into an age of advanced technology, they have to figure out how they are going to deal with these issues and their right to privacy, and what is it that an employee has rights of and not rights of. She said she doesn't want the committee to "sweep so big" that they eliminate one of the privacy issues they have always had, which is telephone conversations. She stated that she sees the legislature inching and inching away the lack of privacy. She wants to be sure that the legislature has covered the bases and that employees know just exactly what their entitlements are. She pointed out that the contract that is mentioned in the bill is a very important part of this issue and should be the result of it. TAPE 98-69, SIDE B Number 0001 REPRESENTATIVE PORTER said, "There is no expectation of privacy if there is no expectation of privacy." He gave an example to the committee that if it is his job to be a telemarketing person, he can well presume that his employer will supervise his job and that's what those intersections of communications are. If he is talking to his wife at noon, he has an expectation of privacy and it better not be violated. Under the wording of the CS, there is implication that it could be. He said he wouldn't vote for this bill without some qualification of that. CHAIRMAN GREEN advised Representative Porter that he is exempt the way the bill is currently written. REPRESENTATIVE JAMES interjected and said, "But there are others similarly situated that we are here to protect." REPRESENTATIVE ROKEBERG indicated he is not certain about the state of the law as it relates to that currently, so he doesn't want to make any statements that might mislead the committee. REPRESENTATIVE PORTER noted that they had to get a waiver to monitor prisoner calls out of correctional institutions. REPRESENTATIVE ROKEBERG remarked that may be because it's a public facility and reiterated that he is uncertain about this and it's a question that needs to be answered correctly, and he is not competent to answer the question. Number 0065 KEVIN JARDELL, Legislative Administrative Assistant to Representative Joe Green, Alaska State Legislature, came before the committee to answer questions. He referred to Representative Porter's comment about getting a waiver to monitor prisoner calls. He said most of the law regarding privacy deals with government intrusion to private individuals' privacy rights. In the context of private citizen v. private citizen, they are generally trespassing laws, not constitutional privacy rights (indisc.). REPRESENTATIVE BERKOWITZ informed the committee he has been doing some research on the issue of privacy and he noted there is a flurry of federal legislation addressing particular telecommunications privacy rights. He also noted that there is legislation addressing medical and surveillance privacy. There is a flurry of discussion as to what the privacy connotations are between private individuals. REPRESENTATIVE ROKEBERG stated that is the reason he introduced this bill. He feels it does, in large part, service to the public to have these things brought forward. He said, "This to me, merely memorializes what the common law is as far as private enterprise is concerned." Number 0185 CHAIRMAN GREEN referred to privacy with telephones and asked, according to this bill, if a telephone is owned by the state, and he uses it for a private call, is he violating the fact that he's not supposed to use state equipment for private use. He also asked, by services, does that include tying into state lines with his own or anybody else's equipment. REPRESENTATIVE ROKEBERG replied that there is a written policy regarding telephone usage. CHAIRMAN GREEN said he does not think it covers the service question he asked about. He asked if he brought in his own computer and tied into a service line that is owned by the state, does that then negate it's his own personal property. REPRESENTATIVE ROKEBERG interjected and said (indisc.) it would. They could tap the line if he was in real time not storage time. CHAIRMAN GREEN asked for clarification regarding business equipment and services and asked, "Does that then make that not private?" REPRESENTATIVE ROKEBERG replied that would be his interpretation if the service data line would be accessible to the employer, not anybody else. MR. JARDELL said his expectation would be that in most situations where an employer has a computer, he would say, "Give me your computer or you're fired. It's my computer, we own it, I have title to it, and I can seize it anytime I wish and go through it." Number 0270 REPRESENTATIVE PORTER asked Representative Rokeberg about the definition of "employer" if he is intending to only include public employers and not private sector employers. REPRESENTATIVE ROKEBERG replied, "No." He said he wanted to include private sector employers. REPRESENTATIVE BERKOWITZ pointed out that there is no definition of "employee." He asked if that would include interns and volunteers. REPRESENTATIVE ROKEBERG replied, "I think the dictionary is adequate." He said he does not recall why legislative counsel put the definition of "employer" in subsection (2) on page 2 of the bill. He said he thinks they wanted to make the distinction that included those public officials as well as private. He commented that Representative Berkowitz made a good point on the completeness of the definition of "employer." REPRESENTATIVE PORTER commented there should be some mention of private employer in the bill. Number 0350 REPRESENTATIVE ROKEBERG offered Amendment 1 to CSHB 319(L&C) which read: Page 1, line 11 Delete: "permit" Insert: "not hinder or obstruct" Page 1, line 11 Delete: "to have" Insert: "from" CHAIRMAN GREEN asked if there is an objection. REPRESENTATIVE BERKOWITZ objected for section purposes. He said, "Imagine in an incidence where the employer wants access to computer records, there's a computer password on it, there's no hindrance or obstruction involved, but it seems to me that the employee could rightfully say, 'Have at it, it's yours, I'm not helping you get into the computer.'" REPRESENTATIVE ROKEBERG replied that it's not obstruction, it's at least hindering. REPRESENTATIVE BERKOWITZ asked Representative Rokeberg how is it hindering. He said, "It's a sin of omission/sin of commission and there's no action here. I'm not obstructing. I'm just not offering assistance." CHAIRMAN GREEN asked Representative Berkowitz if he maintains his objection. Number 0445 REPRESENTATIVE BERKOWITZ withdrew his objection. CHAIRMAN GREEN said there being no objection, Amendment 1 was adopted. Number 0462 REPRESENTATIVE BERKOWITZ made a motion to adopt Amendment 2. CHAIRMAN GREEN asked if there is an objection. REPRESENTATIVE PORTER objected for the purpose of reading it. REPRESENTATIVE BERKOWITZ explained that Amendment 2 changes the default. He said the current default is there's no presumption, no expectation of privacy, so he turned it around so that there's an expectation of privacy. He said if there's some kind of contractual agreement, or some kind of agreement or notification, then the employer can do what the employer wants to do. Number 0479 REPRESENTATIVE ROKEBERG objected. He said it "flies in the face" of what he believes to be the common law, and the administration of law. He indicated that it would change the current law of the state of Alaska. REPRESENTATIVE BERKOWITZ explained that the constitution is clear that they do have the right of privacy. He noted that all he is doing is ensuring if you want to hurdle that constitutional right to privacy, you have to expressly do it and that there's no default where you don't have an expectation of privacy. REPRESENTATIVE ROKEBERG said, "This is not a case of long hair, this is a case of -- privacy is not in a vacuum as the supreme court says in Jennings. Those expectations are balanced by reasonableness and to, by statutory act, overturn an entire body of common law, I don't think it's appropriate. On the other hand, by putting up sideboards we're being specific about where we want to make sure privacy is maintained, that's more -- I think that's a better approach to any amendments (indisc.) approach to this." Number 0544 REPRESENTATIVE JAMES said she supports the concept that employers have a say in what their employees do. She indicated she worked with small employers in the past and she understands how many times they are entrapped because many of the small employers are not real in tuned with some of the fine lines of our law. Her concern with this piece of legislation is that it says there's no expectation of privacy, and that the only way you can get around that is to have an agreement. From her experience with many of the employers that she has had is that they lack the ability to get all of the paperwork done because they don't have a particular person who is an administrator who can do all those kinds of things. She indicated it would behoove the committee to try to make the exceptions in the bill that should be automatically accepted. She said she does not know what that language is and she stated she would expect the sponsor will provide that information. She emphasized that she strongly supports that employers, specifically private employers, should have some control over their employees. REPRESENTATIVE BUNDE stated that it seems like it would be good business practice that if employees will be monitored, they should be notified when the employer begins doing such. He indicated he likes the notion that an employee has the expectation of privacy and then if it doesn't exist, it's the employer's responsibility to notify the employee. REPRESENTATIVE BERKOWITZ made reference to a document in the committee members' packets from the Department of Administration regarding state policy regarding personal use of state office technologies. REPRESENTATIVE ROKEBERG confirmed that there is a state policy and also procedures which were adopted by legislative counsel. REPRESENTATIVE BERKOWITZ stated that the state policy adopted is an affirmative recognition that a state employee is giving up their right to privacy. The policy is not a default position that you have no expectation of privacy. He said the state contract allows a person to give up their rights. REPRESENTATIVE ROKEBERG explained that the intent of the bill is about businesses that don't have huge budgets like government agencies do to draft and memorialize policies, and create these types of procedures and various other things. He said it's about small businesses that are trying to make a go of it, which can be inundated with law suits, inundated with state laws and procedures that create hindrances, hurdles, and obstacles of doing business. He said any other change like the amendment Representative Berkowitz has offered is absolutely offensive to him as a small business person. CHAIRMAN GREEN asked if the objection is maintained. REPRESENTATIVE BERKOWITZ and REPRESENTATIVE PORTER answered in the affirmative. CHAIRMAN GREEN asked for a roll call vote on the motion to adopt Amendment 2 made by Representative Berkowitz. Representative Berkowitz voted in favor of the motion. Representatives Bunde, James, Porter, Rokeberg and Green voted against it. Therefore, Amendment 2 failed by a vote of 5-2. Number 0830 REPRESENTATIVE PORTER made a motion to adopt Amendment 3, a handwritten amendment, which read: (c) Nothing in this section is intended to eliminate the expectation of privacy to which an individual is entitled unless specifically agreed upon by that individual employee. Renumber. CHAIRMAN GREEN objected for the purpose of discussion. REPRESENTATIVE PORTER said the amendment is intended to mean that if a person has a job that would require a supervisor to monitor an employee's telephone conversations because that's part of their job, that expectation of privacy is not there and the employee would concede that's going to happen. He said, on the other hand, no one is entitled to monitor a person's private telephone conversation. REPRESENTATIVE ROKEBERG said he would be happy to look at the CS in the context of the whole issue and get back to the committee. He asked what does "entitled" mean in the context of Amendment 3. He indicated he believes the bill is trying to speak to that. He said, "How this fits in these other areas, I'm not absolutely certain. Conceptually, I agree with what the intent is, but I'm not sure it doesn't defeat the purpose." REPRESENTATIVE PORTER told the committee he forgot to include that Amendment 3 pertains to telephone conversations. REPRESENTATIVE BUNDE stated that he would encourage the Chair to suggest that the sponsor provide a new CS, which addresses the issues that were brought up in committee and also that the CS be examined from legislative counsel's standpoint, rather than the committee trying to do it amendment by amendment. Number 0930 REPRESENTATIVE PORTER withdrew his Amendment 3. CHAIRMAN GREEN said he agrees with Representative Bunde's suggestion that CSHB 319(L&C) be held over for further discussion. Number 1033 PAMELA LaBOLLE, President, Alaska State Chamber of Commerce (ASCC), came before the committee to testify. She advised the committee that the ASCC is supportive of the concept of HB 319. She said their concern has been that employers are the ones who are ultimately held responsible if someone does something with the equipment they own, or on the premises that the employer owns or provides. Their concern is if an employer has the responsibility, they should have access to whatever is going on or is being done with their equipment that would happen that could cause the employer to be responsible. She indicated that the ASCC supports HB 319. Ms. LaBolle said she was in the Labor and Commerce Committee when they discussed the term, "elected officials." She commented that legislators are not hired, they are elected to serve a mandate, and the can be unelected, but they can't be fired. She referred to the term "employer" and said that it could be interpreted by saying what it includes to exclude private employers because their interest is in private employers. She pointed out that school boards are elected officials who are the official employers of the school district, which she noted are not listed in the bill. CHAIRMAN GREEN told the sponsor, "Perhaps in your definitions, you might be able to include something as a definition of 'employee' which may wire around this thing about elected officials." REPRESENTATIVE BERKOWITZ asked how private contractors fit into this scheme. MS. LaBOLLE asked Representative Berkowitz to be more specific. REPRESENTATIVE BERKOWITZ said, "If you hire someone to do a job, but don't make them an employee and they're using your premises." MS. LaBOLLE replied, "If that contractor is driving your equipment, for instance, you're going to be held responsible as the -- for the liability of what happens with that equipment, so, doesn't that carry through on everything." CHAIRMAN GREEN asked, "Well, what if it's a technological type?" MS. LaBOLLE asked, "If they do damage (indisc.)?" CHAIRMAN GREEN explained that he wasn't thinking so much about damage, but privacy. MS. LaBOLLE indicated that she's looking at it from the employer's right to protect themselves by knowing what someone's doing with whatever tool, equipment, facility, whatever the employer has provided, that the employer will ultimately be held responsible for, because of their being the owner or provider of that tool, equipment, device, et cetera. CHAIRMAN GREEN said he feels what the committee is hung up on is not so much the responsibility of the employer, but the privacy of the employee that would allow no interference, no damage, nothing like that, or even liability to the employer. It's just his right of privacy in his workplace. He said that's where they get into the problem of services. MS. LaBOLLE told the committee in her first job, she was not allowed to make any personal phone calls because she was on company time. She said, "The employer has paid you so much an hour to do the work of that employer, and making phone calls on company time, even on your own equipment would be a violation of policy." CHAIRMAN GREEN indicated when legislators call their constituents, they are actually performing their duty and some people might consider it a private call. Number 1463 REPRESENTATIVE ROKEBERG pointed out that HB 319 addresses only business equipment, not personal equipment. If a person has personal equipment, the issue is the service connection, not the equipment itself. CHAIRMAN GREEN said, "That's right, but the service equipment that we have is service to my private equipment." REPRESENTATIVE ROKEBERG said it's the data line, not the equipment. CHAIRMAN GREEN said, "But it's a service, that's the point. You probably should address that. It's a service provided me to use my equipment." REPRESENTATIVE ROKEBERG said, "No, no, the service is the data line. What service are you talking about?" CHAIRMAN GREEN said, "Well, the electricity. I mean, it's held that you can't use your own office, for example, in campaigning, even if it's on time because of the electricity that's used." REPRESENTATIVE PORTER interjected and said, "That's ethics." REPRESENTATIVE ROKEBERG said, "That's not an issue here, we're talking about the communications and ..." CHAIRMAN GREEN said, "I know it's ethics, but I'm saying -- the point is I'm not saying that that has anything to do with ethics, the point is that it is a service." REPRESENTATIVE ROKEBERG said the electrical plug has nothing to do with this bill. REPRESENTATIVE PORTER interjected and said "He doesn't think that an employer will, under this bill, have access to your computer." CHAIRMAN GREEN agreed with Representative Porter and said that's a question that needs to be answered. REPRESENTATIVE ROKEBERG said, "It's clearly prohibited here." CHAIRMAN GREEN said it is not clear because he talked to an attorney who had the same question, therefore, it's not clear. REPRESENTATIVE ROKEBERG replied that it was intended to be clear. CHAIRMAN GREEN reiterated that it is not clear and that it needs to be addressed. [CSHB 319 was held over for further discussion.]
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