The other side of the balance: employer interests, work systems and R v Cole By Dan Michaluk On October 19th

the Supreme Court of Canada issued a much-awaited decision for employers across Canada. In R v Colei, it affirmed a Court of Appeal for Ontario finding that a school teacher had a reasonable expectation of privacy in a work-issued laptop. The Canadian Association of Counsel to Employersii intervened in Cole at the Supreme Court of Canada on behalf of its management counsel members and (more generally) on behalf of Canadian employers. This note explains why CACE is pleased with the outcome, which establishes a strong foundation for continued employer access to information stored on work systems. Background The background to Cole is now well known. A school board noticed an irregular traffic pattern on its network. It followed up by remotely examining a laptop connected to its network and found photographs it believed to be child pornography. This led the board to confiscate the laptop and report the matter to the police. The police received and searched the laptop (and a CD-ROM created by the board) without obtaining a warrant. They charged the teacher to whom the board had issued the laptop. In a March 2011 judgment the Court of Appeal for Ontario found that the teacher had a reasonable but diminished expectation of privacy that the police had breached.iii This finding was troubling to CACE. In recognizing that the accused teacher had a Charter-protected privacy interest, the Court gave great weight to his exclusive possession of the laptop. He had it in his exclusive possession on weekends, the Court said.iv The laptop had a password to keep others out, it also said.v This analysis, in CACEs view, did not properly account for the employers interest in the laptop, which was issued for a work-related purpose as part of an integrated business information system. The Court of Appeal for Ontario had recognized an employee interest that would potentially compete with important employer interests. CACE felt the Courts basis for recognition was erroneous and would create difficulty for Canadian employers. CACEs intervention Many are surprised to learn that CACE did not take a position on the Court of Appeals finding that the accused had a reasonable but diminished expectation of privacy in the content of his work-issued computer. This was partly because the expectation of privacy finding would have been difficult to challenge. The record was not favorable to a no privacy argument.vi It was also clear

-2to CACE that values have been shifting to favor recognition of a work system privacy interest for some time. Even leading up to the Court of Appeal for Ontarios decision in Cole, case law was suggestive of a soon-to-be-made adjustment.vii More importantly, the expectation of privacy finding had (and continues to have) little practical significance to employers. Employers care that their work systems function as designed and care that they have access to information stored on their work systems as required. The most direct position for CACE, therefore, was to explain to the Court how the teachers laptop was part of an integrated business information system and tell the Court, quite bluntly, what employers need clear and unfettered access to system information for a variety of legitimate purposes. CACE spelled out what was at stake for employers by making the following points about work information systems: 1. A work information system is made up of a network of computers. Computers issued to employees are part of the network and need to be governed as part of the network. A work information system is a critical component of an employers business infrastructure. Its function is to enable employees to communicate with each other in the course of work, to communicate externally in the course of work and to engage in productive work. A work information system is a repository of information about virtually all the activities of an organization its communications, its transactions and its intellectual property. Employers must control the information on their systems and keep it secure.viii The value of information stored on a work information system to employers depends on access for a range of important purposes.

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CACE explained how the Court of Appeal for Ontarios reasoning did not adequately reflect these points and asked the Court to re-balance employer and employee interests to leave employers with a broad right of access to system information. The judgment The Supreme Court of Canadas reasonable expectation of privacy finding is remarkably simple; if an employer permits or can reasonably expect personal use on its work system, employees will have a reasonable but diminished expectation of privacy. There is little left to dispute about employee expectations now, and though some employers might not like the finding, the Supreme Court of Canada has given employers clarity.

-3The Supreme Court of Canada also calibrates the expectation in a much more favorable manner than the Court of Appeal for Ontario. The expectation of privacy is no longer supported by the flawed notion of exclusive possession. Instead, the Court recognizes that Mr. Coles laptop was equipped with a password, the contents of his hard drive were thus available to all other users and technicians with domain administration rights at least when the computer was connected to the network.ix It notes that the employers policy and technological reality deprived the employee of exclusive control over and access to the personal information he chose to record [on a work system].x This view, which reflects CACEs submissions, led the Court to expressly acknowledge that the circumstances affecting the employee privacy interest pull in competing directions.xi In the end, it finds that the employee privacy interest was significant enough to warrant Charter protection, but suggests this because the circumstances did not render the interest entirely eliminated.xii Employees clearly have enough of a privacy interest to be protected from warrantless searches by the police, but not that much of a privacy interest to weigh against employers interests. Although the Supreme Court of Canada did not make any principled pronouncement about employers interests, it demonstrated sensitivity to employers (1) by expressly setting employers interest in monitoring apart from its expectation of privacy findingxiii and (2) by affirming that the school boards actions were reasonable (even though the reasonableness of the school boards actions was not challenged on appeal).xiv By taking this latter step, the Court gave Charter-bound employers some idea about the standard of justification they will face for searches of information on their systems. We know, for example, that government (acting as employer) will not likely require judicial authorization or even express statutory authorization to access personal information stored on its work systems. Further articulation of management rights will come in time.xv Management rights going forward The Cole decision establishes a strong foundation for continued employer access to information stored on work systems. Partly, this is because the privacy interest recognized by the Supreme Court of Canada is so limited. It is also because employers, with proper attention to policy, will be able to defend their practices by arguing that they have a superior interest that should prevail when employees have made an informed choice. Here is what CACE said in its factum: Personal use of a work system is, by its very nature, secondary and a privilege a convenience to employees and an alternative to using a home computer or a personally-owned device. Ensuring this convenience is available to employees in our society is not required to support the values of dignity, integrity and autonomy that underlie section 8...

-4The reasonable employee understands that there is a consequence to intermingling work product and personal information, takes advantage of the convenience of personal use for less sensitive personal computing needs and uses a home computer or personally-owned device before doing what needs to be kept private. To argue that an employer should be precluded from acting in its own legitimate interest because an informed employee has chosen to expose his or her information to the employers stated practices is to suggest that convenient use of employermaintained, confidential computing services is itself a right. This will be a very hard argument for employees and unions to make against Charter-bound and other employers in light of Cole, especially given the Court recognized that the choice an employee makes in exposing his or her personal information weighs against an expectation of privacy. This is why, since Cole was issued, many of CACEs members have advised their clients to revisit their workplace policy with a view to being more transparent about their need to access system information. Though a wide range of employer practices should be expected by the reasonable employee who has not been given express warning, employers who strive for transparency should fare quite well in managing the newly recognized expectation of privacy. November 15, 2012
R v Cole, 2012 SCC 53 (CanLII) [Cole at SCC]. CACE is an association of management-side labour and employment lawyers with a mandate to ensure that advancements in Canadian law adequately reflect the interests of employers. iii R v Cole, 2011 ONCA 218 (CanLII). iv Ibid, paras 36 and 45. v Ibid, paras 35 and 45. vi Mr. Cole had stored inappropriate pictures of his wife on his laptop, the employers policies were flawed (a fact noted by the IT staff who conducted the boards investigation) and, most significantly, the matter involved both employer and police searches. vii See e.g., France v Tfaily, 2010 ONCA 127 (CanLII), National Bank Financial Ltd v Daniel Potter, 2005 NSSC 113 (CanLII) and Lethbridge College and Lethbridge College Faculty Assn (Bird Grievance) (Re), [2007] A.G.A.A. No. 67 (Ponak). viii See Robichaud v Canada (Treasury Board), [1987] 2 SCR 84 at p 95a and Poliquin v Devon Canada Corporation, 2009 ABCA 216 at paras 46, 47 for judicial statements supporting employers responsibility for maintaining an orderly and well-controlled environment. ix Cole at SCC, supra para 56. x Ibid, para 54. xi Ibid, para 57. xii Ibid, para 58. xiii Ibid, para 60. xiv Ibid, paras 62, 63. xv Charter-bound employers should look to the Supreme Court of Canadas decision in R v M (MR), 1998 CanLII 770 (SCC) for favorable articulation of the search standard that should apply in an orderly environment.
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