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Privacy Matters: How to Monitor Employees for Regulatory Compliance without Violating Employee Privacy
An ObserveIT Whitepaper | Gabriel Friedlander

Executive Summary
Under the increasing burden of regulatory compliance such as PCI, HIPAA, SOX, NERC and ISO 27001, companies are more and more seeking some form of monitoring platform for recording employee activity. Not surprisingly, this has been met with concern on the part of employees, who fear that employee monitoring is stepping on their rights to privacy in the workplace. However, a combination of transparency and common sense can bridge these two seemingly diametric positions. After all, if an employer seeks to simply meet regulatory compliance, and can do so without infringing on employee rights, then both sides will benefit from greater efficiency, clarity and profitability. This whitepaper highlights the legal issues driving the employer and employee concerns, and follows that up with a detailed checklist of how to effectively deploy a monitoring platform, achieve regulatory compliance and maintain employee trust and support, all at once.

Opposing Forces?: Finding Common Ground in the Employee Monitoring Argument

Employees Fears
The advent of technology in the workplace has made it much more feasible than ever before for employers to electronically monitor the activities of their employees, including phone conversation recordings, video recordings of the workplace premises and computer activity recording. The threat of being constantly monitored immediately brings to mind (thoughts of Big Brother: We are being spied on, so that the boss can squeeze even more work out of us! And employees indeed are right in being concerned about their own personal privacy. Unfortunately, these concerns often overshadow the larger issue at hand. For this reason, it is critical that employers take great efforts in order to ease the employee concerns.

Employers Needs
In reality, employee efficiency is a much smaller concern to employees than the much more threatening issue of corporate accountability and security of sensitive information.
Privacy Matters: How to Monitor Employees for Regulatory Compliance without Violating Employee Privacy
Copyright 2011 ObserveIT Ltd. | www.observeit-sys.com

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Of course, employees would like to improve efficiency wherever possible. But in more cases than not, employee training, trust and standard management oversight are effectively applied to meet these needs. Accountability, however, is not so easily managed away. In almost every industry segment, compliance regulations such as PCI, SOX, HIPAA, HITECH, NERC, ISO 27001 mandate very explicit accountability of all user access to sensitive data. And even where regulations are not applicable, internal security controls will often raise the exact same needs. Recording user activity is the most straightforward way to answer this need. Here, we focus on the aspect of computer activity recording, leaving aside the productivity orientation of phone conversation recording and the physical security orientation of closed-circuit video.

Regulatory Mandates for User Tracking

While each compliance regulation is unique in its requirements, the core need surrounding sensitive data typically boils down to: Make sure your data is secure, and make sure you can show exactly who did what do the data. Some examples of accountability requirements include: PCI-DSS The Payment Card Industry Data Security Standard regulation provides 12 high-level requirements covering a wide range of issues related to credit card and financial information management, from access rights to data storage to audit monitoring. These include Requirement 10: Track and monitor all access to network resources and cardholder data, with explicit details of what must be done. For example, Section 10.2 requires parties to Implement automated audit trails for all system components to reconstruct the following events: 10.2.2: All actions taken by any individual with root or administrative privileges 10.2.7: Creation and deletion of system-level objects. HIPAA & HITECH The U.S. Health Insurance Portability and Accountability Act (HIPAA) specifies how organizations should manage Protected Health Information (PHI). This includes Security provisions (Subpart C) and Privacy provisions (Subpart E). These requirements are then further detailed in the subsequent Health Information Technology for Economic and Clinical Health Act (HITECH), which requires entities to clearly identify employees and business partners who access PHI, to ensure that the data within its systems has not been changed or erased in an unauthorized manner, and make documentation of their HIPAA practices available to the government to determine compliance. ISO 27001 ISO 27001 is an Information Security Management System (ISMS) standard published by the International Organization for Standardization (ISO). Businesses that implement ISO 27001 can demonstrate reliable security practices to customers and business partners, thus establishing trust, meeting regulatory oversight requirements of many nations and saving costs by reducing the needs for ad hoc auditing processes. ISO 27001 calls on any compliant business to examine information security risks; implement comprehensive information security controls for risk treatment; and incorporate management processes in order to ensure the controls on an ongoing basis.

Privacy Matters: How to Monitor Employees for Regulatory Compliance without Violating Employee Privacy
Copyright 2011 ObserveIT Ltd. | www.observeit-sys.com

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SOX The U.S. Sarbanes-Oxley Act (SOX) is a wide-ranging act that requires all publicly traded companies to deploy internal controls for accountability and integrity of the financial reporting process. This broad issue includes Section 404: Assessment of internal control, which many assess to be the most difficult and costly to satisfy. Fulfilling Section 404 is often achieved by adopting the COSO Framework, which include methods for Risk Assessment, Control Activities, and Monitoring, among others. If management fails to establish a monitoring process for its internal control system, either in the form of independent evaluations or ongoing monitoring, then a satisfactory rating for this control component normally would be inappropriate.

Employee Rights in the Workplace

The right of employees to a reasonable level of privacy is quite clear, on moral as well as legal grounds. Laws are in place in most countries on this matter, including: USA (Federal Law): Electronic Communications Privacy Act (ECPA) ECPA focuses primarily on the issue of government and law enforcement access to communications, but also includes Title II, which protects any electronic communications that are maintained in storage, typically in the form of computer-stored messages. Employee communications are protected in theory, but it is quite easy for employers to provide notice or show that employee actions are not in the companys interest, providing the legal right to monitor employees. USA (State law) Many states enact additional restrictions or clarification via state laws. While these vary from state to state, the heart of most of the restrictions remain in the realm of personal privacy, such as Californias Workplace Surveillance Labor Code Section 435, which prohibits video surveillance in areas that employees can reasonably expect privacy, such as changing rooms and restrooms. Some regulations extend these privacy rights to computer messages, but again a certain vagueness remains regarding what is considered private data remains. (ex: Personal messages posted on a private on-line forum during break time may be private, but what if the forum is public, or what it is done during work hours, etc.) Canada: Personal Information Protection and Electronic Documents Act (PIPEDA) As in the US laws, PIPEDA also calls for employee privacy rights, but leaves a somewhat vague definition of when it is justified to monitor employee computer activity. The Office of the Privacy Commissioner provides some guidelines, which call on the employer to show that the surveillance is necessary to meet a particular need; that the surveillance will likely be effective; that privacy loss is proportional to the benefit gained; and that no reasonable, less-invasive methods exist to meet the need. UK: Human Rights Act The HRA allows employers monitor communications within the workplace only as the employee is aware of the monitoring before it takes place. Furthermore, employees have the right to see any personal information held about them. European Union: Data Protection Directive 95/46/EC This Data Protection Directive provides a wide range of guidelines for privacy assurance, without significant focus specifically on the employer-employee relationship within this area. The net result, as in the countries listed above, is again a situation where reasonable employee monitoring can be justified as long as there is a proper trail of Notification, Purpose, Consent, Security, Disclosure, Access and Accountability.
Privacy Matters: How to Monitor Employees for Regulatory Compliance without Violating Employee Privacy
Copyright 2011 ObserveIT Ltd. | www.observeit-sys.com

User Monitoring Checklist

Given the push-pull effect of regulatory mandates on one hand and personal privacy protection on the other, some balk at the task of implementing a monitoring platform that is legal, compliant and maintains the good will of employees. But threading this needle isnt as hard as it may sound. Heres how:

State upfront the exact goals

Reinforce the benefits the company, and tie these to a benefit for each employee

Let your employees know ahead of time why you need to implement some form of monitoring. You get good will when employees understand your needs. To this end, be sure that you communicate in a clear way. Dont distribute a legal-sounding treatise about regulatory oversight. Tell them in your own words, using examples of the type of actions that you must be accountable for to auditors.

Instead of making it a burden, show employees how compliance will make work more efficient or profitable. Highlight points such as the elimination of ad-hoc audit research (which is usually a highlystressful activity) and improved safety of the employees personal data from illegal activities.

Let them know what is OK, and establish trust

Document the downside

Clarify what is acceptable, and when personal activity is OK Show how you respect and even encourage it. If they know that Activity A is a no-no, but Activity B is OK, they will feel more empowered and confident in doing their day-to-day work. Again, avoid the threatening legal-speak, and keep it personal.

Continuously remind employees about policies

Any good will or clarity is lost if the info is hidden among thousands of pages of corporate policy manuals that are rarely looked at. If you can deliver the message in a friendly, informative manner (preferably while the user is initiating a recordable activity), then you can be sure that the employee is aware.

Make sure that everyone knows what will happen if they break corporate policy. You may not care that a particular employee is surprised that s/he is being fired for a particular violation. But what about all the co-workers? You dont want them in shock or angry. It is better for all if their reaction is Well, s/he knew that this would be the result, because we all learned it in our policy training session, and we all click OK every day for the policy reminder!

Make all communications a corporate message (and NOT an IT or Legal message!)

Tell employees how you will be monitoring them

Let everyone know what is being recorded. Dont worry about exposing potential workarounds, and dont try to keep the recording policy a secret, in hopes of improving security. Anyone who might try to work around the system will find the weak points anyway, so you are better off being upfront in letting everyone know exactly how it works.

Compliance issues are a company-wide concern, not a specific IT concern or a Legal Department concern. Plus, many employees are scared of the technology team, and also of the lawyers. So make all the communications from a corporate perspective, not from any specific department. This delivers a clear message that this is a clearly defined business goal, not something driven by some crazy IT manager just because s/he has the ability to do so.

Be Consistent

Make sure that your monitoring activities, as well as any enforcement of policy violation, are all implemented on a completely transparent and evenhanded manner. Employees should know that they are not being singled out for any reason.

Privacy Matters: How to Monitor Employees for Regulatory Compliance without Violating Employee Privacy
Copyright 2011 ObserveIT Ltd. | www.observeit-sys.com

Solving both compliance and privacy: An effective solution for monitoring user activity that meets legal requirements
Visual On-Screen Recording + Textual Summary Logs: Capturing the information you need
The purpose of deploying a monitoring platform is to know what took place. With ObserveIT, you have instant audit logs and video replay that show precisely what occurred. For any issue investigation, each log entry event is linked to a full video replay of the user session. View an exact playback of user activity, as if you were looking over the users shoulder as it took place. With this level of accountability, there is no question as to what transpired, making any attempts of repudiation or denial utterly groundless.
WHAT DID THE USER DO?
A human-understandable list of every user action

Salesforce.com UPS.com Quantum View MagicISO CD/DVD Manager Microsoft Visual Studio 2010 Skype CustomerDetails CRM

Cloud Apps Cloud Apps

Commercial S/W with no logs Legacy software Who, When, Where

USER SESSION REPLAY:

Bulletproof evidence

CAPTURES ALL ACTIONS:

Mouse movement, text entry, UI interaction, window activity

PLAYBACK NAVIGATION:
Move quickly between apps that the user ran

Just-in-time policy reminders

Before authorizing the user to access the system, ObserveIT requires that policy status information be read and confirmed. This eliminates the need to handle policy update validation in a separate process: No more email trees, no more tracking spreadsheets to make sure everyone got it.

REMINDER: All activities on this computer a being recorded. NOTE: Corporate policy states that employees should not open any Customer Details pages unless necessary for handling an explicit customer request.

POLICY MESSAGING:
User must acknowledge

Privacy Matters: How to Monitor Employees for Regulatory Compliance without Violating Employee Privacy
Copyright 2011 ObserveIT Ltd. | www.observeit-sys.com

6 Excluding private activities from being recorded

In order to maintain employee trust and to meet the legal rights of employees, you may want to enable employees to use certain applications, such as Skype or instant messaging apps, without fear of being recorded. ObserveIT offers fully granular policy rules that give you the monitoring oversight that you need, while ensuring that employees still have necessary privacy.
GRANULAR RULES
Include / Exclude policy per user group or application

Consistent monitoring policy rules

The policy rules that are defined in ObserveIT are deployed consistently across all user groups, users, computers and applications. It is easy to specify balanced rules that ensure consistency and prevent any sense of singling out a particular employee or group of employees.

Protecting access to user recordings

ObserveIT provides a secure platform for storing all user recordings, and it also provides a fully-auditable process for accessing these recordings. A clearly-defined access control hierarchy explicitly specifies who can replay which recordings. Thus, some administrators can have access to only some recordings, according to what application was being used, or by which employee, or on what computers. ObserveIT monitors itself as well, so any user access to view an employee recording will also be logged and reviewable.

Enabling employee enquiries

ObserveIT enables you to create detailed reports per user or per computer that can be delivered by email. In addition, user session recordings can be exported and delivered to employees, thus documenting exactly what is being recorded when they explicitly request details, as per their rights according to the the UK WRA and other similar laws.

Privacy Matters: How to Monitor Employees for Regulatory Compliance without Violating Employee Privacy
Copyright 2011 ObserveIT Ltd. | www.observeit-sys.com

Conclusion
Meeting compliance regulations requires a detailed and orderly audit of user activity that can affect sensitive data. Achieving this level of audit details requires a certain level of employee monitoring. However, this can be achieved without losing trust of employees and without infringing on their right to privacy. Successful implementation of such an auditing process requires building trust and faith among employees. This can be achieved with transparency and clarity of all monitoring policies, combined with a monitoring solution that delivers explicit audit details but allows for proper policy rules and security oversight. ObserveITs software platform for user activity recording is a central pillar in any such monitoring strategy. Benefits of using ObserveIT include: Accountability of all activities that can affect sensitive data. Reduced costs to generate compliance reports, with less effort, and faster turnaround time Unequivocal proof of user activity, guaranteeing authentication and non-repudiation Greater employee trust that comes from a transparent and consistent platform

About ObserveIT
ObserveIT auditing software acts like a security camera on your servers. It provides bulletproof video evidence of user sessions, significantly shortening investigation time. Every action performed by remote vendors, developers, sysadmins, business users or privileged users is recorded. Video recordings include mouse click, app usage and keystrokes. Each time a security event is unclear, simply replay the video, just as if you were looking over the users shoulder. ObserveIT is the perfect solution for 3rd Party Vendor Monitoring, Compliance Report Automation and Root Cause Analysis. Founded in 2006, ObserveIT has a worldwide customer base that spans many industry segments including finance, healthcare, manufacturing, telecom, government and IT services.

For more information, please contact ObserveIT at: www.observeit-sys.com sales@observeit-sys.com US Phone: 1-800-687-0137 Intl Phone: +972-3-648-0614

Privacy Matters: How to Monitor Employees for Regulatory Compliance without Violating Employee Privacy
Copyright 2011 ObserveIT Ltd. | www.observeit-sys.com