ETHICAL CASE STUDY 1

Ethical Case Study: Misuse of Company Internet

Karthik Margabandhu

Ottawa University

Value-Systems and Prof Ethics-BUS-7200

Professor Sabrina Khan

February 26, 2023

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Introduction

The advance of the Internet created a wave of changes to how the world does business.

However, with computers and the Internet integrated into nearly every aspect of business,

companies are becoming increasingly aware of the risks of Internet misuse posed by employees

using the ubiquitous Internet for personal online transactions or to check their social media

newsfeeds (Siau et al., 2002). Or what sports fan hasn't visited ESPN.com during work hours to

check the latest football score for his or her favorite team? A study found that at least 64 percent

of employees visit non-work-related websites daily (Schwartz, 2015). Sending personal emails,

online shopping, downloading music, private banking, browsing the Internet for sports or other

content, or visiting social networking sites such as Facebook, Instagram, or Twitter are examples

of typical computer-based Internet abuse (Ferrell, Fraedrich, & Ferrell, 2019).

Theft of employee time can have a negative impact on a company, resulting in a decline

in productivity and profit. Using company computer software and the Internet for personal

business is one of the most common ways employees abuse company resources (Ferrell,

Fraedrich, & Ferrell, 2019). Even though the aforementioned issue may be minor in comparison

to other unethical problems at work, it may have a ripple effect on employee productivity. Few

hundred dollars is a relatively modest amount of money. However, for many small businesses, a

few hundred dollars can be a significant sum. When an employee switches between a work-

related task and a personal online website, they lose some focus and concentration. For instance,

when an employee leaves a website like Facebook, it takes a few moments for his or her brain to

fully refocus on the previous task (Anderson, 2020). Many businesses that previously allowed

unrestricted Internet access are beginning to implement strict internet policies by blocking

certain websites. Below are some statistics regarding Internet abuse:

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 According to a survey, 47% of employees send up to five personal emails per day, while

32% send up to ten. 28% receive up to 20 emails per day (Vault.com, n.d).

 According to Frank Rauchfuß, CEO of intelliAd, the busiest time of day for online

shopping is between 2 and 6 p.m. on weekdays. In terms of device usage, he added that

most users switch to personal devices after work (Morris, 2016).

 According to a study conducted by the American Society of Employers, 20% of every

dollar earned in the United States is lost to employee theft. Another study found that time

theft costs U.S. employers over $400 billion in lost productivity annually (Bowersox,

2018).

Management of employee Internet access is transitioning from an IT-only concern to an

HR concern. My personal case study discusses the increasing use of the Internet for personal

purposes by employees at work and corrective measures that companies can take, drawing on my

own work experience.

Ethical Case Description

The Internet has revolutionized how businesses operate, communicate, and conduct

business. Statistics indicate that the inappropriate use of the Internet by employees during work

hours raises moral and legal concerns. According to studies, employees use the Internet

extensively for personal reasons during work hours. Businesses strive to effectively regulate

Internet usage and increase employee productivity. Sending personal emails, online shopping,

downloading music, internet banking, browsing the Internet for sports information, and logging

into social media platforms such as Facebook or Twitter are typical examples of internet abuse

on a business network (Ferrell, Fraedrich, & Ferrell, 2019). Currently, mobile networking

devices, laptops, and other Internet-capable technologies enable employees to access the World
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Wide Web from anywhere, a capability that could affect workplace operations if employers do

not regulate usage.

In this case study, I will discuss the ethical issues, concerns, and difficulties associated

with internet abuse and internet addiction at my place of employment (ABC). As a strategic

measure to combat the misuse of the Internet by employees, we will also consider possible

courses of action, such as employee training and the implementation of internet usage policies.

Parties Involved

Employees, employers, the IT department, and the Human Resources department are

stakeholders in this ethical issue, and each has a unique set of rights and obligations.

Employees who use the company's Internet for personal purposes, resulting in decreased

productivity, are the key players.

The IT department and the Human resource department are stakeholders because

implementing an internet usage policy and monitoring employee internet usage is typically the

responsibility of both departments, as they seek to protect both the employee and the networking

infrastructure by taking preventative measures. Therefore, collaboration between these two

divisions is necessary to ensure that a comprehensive internet usage policy and guideline are

developed in accordance with the needs of the organization (GFI Software, n.d.).

Company ABC (employers) are stakeholders because the Internet has altered the scope of

employment laws and employer liability for workplace harassment and discrimination. For

instance, coworkers who engage in harassing behavior, such as making inappropriate comments

about another employee's disability on a social networking website, may be guilty of workplace

harassment. If an employee complains about an inappropriate internet post or activity, it is the

responsibility of company ABC to discipline the coworker.

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Ethical Issues

Should employees be allowed to use the Internet for any lawful purpose? Is Internet

access at work a privilege, a right, or a luxury? ABC considers Internet access a privilege and

seeks to restrict it to maximize business use, business connectivity, and employee productivity

(Case & Young, 2002).

In addition to other company policies addressing corporate ethics, intellectual property

(IP) rights, privacy, sexual harassment, and cyber security, businesses must implement an

internet usage policy (IUP) to address issues arising from employees' inappropriate Internet use.

The following are some of the ethical challenges ABC and its employees face:

1. Initial research on the effects of using the Internet for personal purposes during work

hours revealed a negative impact on productivity (Machado et al., 2013).

2. Businesses maintain a variety of electronic communications systems and equipment, such

as telephones, computers, printers, email, and Internet access. When employees abuse

such systems, the company assumes responsibility.

3. Internet Surveillance in the Workplace As both the employer and the employees must

protect their own interests, ABC may result in a conflict between the two parties.

Employers will want to ensure that company resources are not being abused, whereas

employees will desire anonymity. By avoiding illegal monitoring of employees' online

activities, businesses can develop ethical monitoring policies regardless (Burks, 2016).

Companies that monitor the internet usage of their employees while ensuring that they do

not compromise the employees' privacy at work face ethical issues.

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4. Accountability of employees is an ethical concern for an Internet usage policy.

Accountability's purpose is to identify and monitor employee activities (Burmester et al.,

2006). By documenting employee accountability for internet use, employers can identify

employees who misuse company internet. Employers should use monitoring software to

record their employees' secure browsing history for accountability purposes (Martin

& Freeman, 2002). There may be some employee apprehension as a result of the fact

that greater transparency means less privacy (Burmester et al., 2006). A benefit to

accountability is the fact that employees are not liable for the inappropriate use of the

internet by a third party.

Failure to investigate policy violations and take appropriate disciplinary action may

demonstrate to employees that the company (ABC) was aware of the illegal or unethical

behavior and did nothing about it, thereby undermining employee confidence and trust in the

company. Without employee trust, establishing an ethical culture is difficult.

Case Issue Facts

Employee A, a Project Engineer at my company (ABC), is currently on the lookout for a

home to purchase. He visits real estate websites such as Zillow.com, Trulia.com, and

Realtor.com frequently. During work hours, he spends at least one to two hours searching for

homes that meet his requirements or conversing with a real estate agent about the home's

specifics.

Employee B in my organization (ABC) constantly checks her phone and is frequently

distracted while monitoring stock prices on Robinhood.com using company internet. As a result

of her actions, the company's productivity and expenses have decreased.

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Employee C is frequently observed on YouTube watching software tutorial videos. This

action may be viewed as employee training and development by others within the organization.

Nonetheless, this employee is watching these videos to improve his software skills for a

freelance project. This employee is misusing company resources for personal gain.

As stated previously, many employees frequently check stock prices, search for travel

discounts, and send personal e-mail using company internet while at work despite their

employers' prohibitions (R. Johnson & Rawlins, 2008). If employees abuse the Internet,

employers may incur civil and criminal liability in both state and federal courts. Employee X can

file a complaint against the employer if, for example, Employee Y in my organization sends

sexually explicit or harassing e-mails to Employee X, even though the behavior does not benefit

my company or advance its business objectives (e.g., for the toxic environment or sexual

harassment). Vicarious liability renders company ABC (employer) inevitably liable for damages,

regardless of whether they were aware of the email. Employer Y is liable in this instance because

it permitted Employee Y to send the email and is responsible for monitoring Employee Y's

behavior.

Ethical dilemma

Employees who use the Internet for non-work-related purposes deplete network resources

and reduce the system's responsiveness to work-related tasks. Due to the need for subscriptions

to internet service providers and hardware to accommodate growing network traffic and data

storage, Internet connectivity costs company ABC money. A major technology company audited

its internal network for one week in order to examine online communications. The remainder of

online communications, such as accessing sports pages, news channels, and online games,

decreased network efficiency, according to their research (Young, 2001).

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As outlined in the ethical issues, inappropriate use of the company's internet by company

ABC employees can slow internet access for other employees and eventually lead to system

failure. There are billions of dollars in lost productivity for every minute, hour, or day that an

employee uses the Internet for personal reasons. Fifty percent of employees surveyed by an

Internet management company admitted to using company Internet for personal reasons

(Saalfield, 2005). Internet usage is one of the greatest obstacles to employee productivity, as

approximately 34 million of the 68 million U.S. employees who use the Internet at work do so

for personal reasons. Continued Internet use for personal purposes by U.S. employees costs

businesses $178 billion annually, or $5,000 per employee (Saalfield, 2005). Websense Inc.

estimates that Internet abuse in the workplace costs U.S. companies $63 billion in lost

productivity annually (Patrick, 2018).

Acceptable Employee Internet Usage Limit

Internet must be used as a platform to facilitate employees' work performance while

advancing the goals of company ABC. The unwarranted use of the company's Internet for

personal purposes during working hours should be prohibited, but the occasional and reasonable

use for personal purposes should be permitted, if

 Internet usage and employee productivity have no correlation.

 ABC's internet usage policy must not be violated in any way using the company's

Internet.

• The use of business Internet for personal purposes should not have negative effects on the

business network by consuming an excessive amount of bandwidth.

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Role of Information technology

Internet and new technologies have a substantial impact on the workplace and how work

is performed. In the workplace, technology has proven to be both beneficial and detrimental.

Employers are increasingly required to address issues associated with the misuse and abuse of

employee communication systems. The case study focuses heavily on technology misuse in the

workplace.

Course of Actions

More than 700 businesses were surveyed by Telemate.com where they asked senior

executives, information technology managers and human resource managers about employee

Internet abuse and Internet misuse was reported by 70% of them where misuse attributed to the

real costs to their companies, and 83% were worried about how to resolve the problem (Young,

2001).

The following courses of action will help ensure employees stay within acceptable internet

use while adhering to company policy.

1. Evaluate the present risk of the company due to Internet harassment of employees

2. To protect the business from corporate liability, create a robust employee, appropriate

Internet usage, and abuse policy.

3. Improving collaboration between the departments of human resources and information

technology to optimize their efforts.

4. Employ systematic and efficient techniques for monitoring internet usage.

5. Educate employees on business strategies to improve compliance.

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Analysis of Courses of Actions

1. Evaluation of current risk: If the company currently does not employ Internet usage

policies, employee monitoring, and training on acceptable internet usage, your business is

at significant corporate risk, and it essential that the company takes action.

2. Internet usage and abuse policy: Unlimited employee use of the Internet seems to have

the potential to drain internet connectivity and decrease employee productivity. The

solution to the problem is to implement a policy that outlines acceptable employee

internet usage. The policy should clearly define employee internet usage behavior and

should also include consequences for violations. This policy can act as a legal document

for all employees with internet access privileges. A comprehensive policy will safeguard

the employer from corporate risk and liability due to lawsuits such as employee internet

misuse termination. It will also prevent the excessive drain of the company internet.

3. Collaboration between IT and HR: Crossing training between the IT team and the HR

team is essential for the HR teams to understand the technology involved in employee

monitoring to assist in prompt response in case of potential problems. The IT team needs

to be involved in the process of compiling an internet usage policy along with the HR

teams.

4. Monitoring internet usage: Using a filter to block websites that reduce employee

productivity and are objectionable to company policies. Companies can monitor time

spent on news sites, online shopping, etc. and track employee activities. Employee Y in

my organization sends harassing emails, and Employee B browses the internet surfing

sports sites; Employee Y's use will be most likely to be deemed a policy violation due to
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the online activity's sensitivity even though Employee B spends a large amount browsing

sports sites.

5. Educate employees: Companies need to provide training to existing employees and new

hires, clearly defining acceptable and unacceptable Internet use.

Course of Action Pros and Cons

The above-listed courses of actions will result in improved employee accountability and

ethical integrity when online. It also enhances employee morale and job productivity and

decreases corporate risk and liability when violations occur.

However, when employers employ filters as a part of employee monitoring, while filters

are useful, they are not full-proof, as computer-savvy employees can disable the filter or pass

through the firewall with ease. Using software that erases their Internet tracks and removes any

traces of inappropriate or objectionable online use can also hinder the monitoring process

(Young, 2001).

Employers face legal dilemma when deciding to monitor employee activities. The

concern is that if they do not monitor their systems, they may be held liable where abuses of

computer systems occur. However, if they choose to monitor their systems, employers may risk

actions for invasion of privacy. In such cases, employers can take preventive measures by asking

employees to sign an acknowledgement indicting that use of the employer has the right to

monitor systems and that employees are forbidden from excessive usage of company resources

for personal gain (FindLaw, 2008).

While deciding which employee needs to be monitored, the company should determine if

job status influences their decision. If all employees are monitored, how will senior management
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react to this decision? Many businesses may choose to monitor middle to lower management to

cope with this situation, providing senior management with unlimited Internet access. The

expectation is that, because of their job duties, senior managers would not misuse the Internet.

Senior-level managers, however, are equally prone to develop excessive or abusive Internet

habits.

Terminating employees who misuse company internet results in ending internet abuse;

however, it generates hidden costs for the employer, such as recruitment expenses. Termination

of an employee can also create fear, mistrust, and hostility in the workplace. Therefore, ABC

must establish a detailed plan to deal effectively with critical incidents.

Selected Course of Action

In the given scenario, I would choose the second course of action: to enforce an extensive

employee Internet usage and abuse policy to safeguard the company from legal responsibility. In

addition to the Internet usage policy, I will employ an employee internet monitoring system.

Internet Usage Policy

Owing to an increase in the misuse of company internet by employees, unregulated

employee usage of the Internet can drain the internet network and lower employee productivity

by implementing an internet usage policy (IUP) that will delineate acceptable and unacceptable

conditions internet usage behavior and limit.

The Internet Usage Policy is an important document that all employees must sign when

starting employment (GFI Software, n.d). In addition to defining acceptable uses, an internet

usage policy will clearly outline prohibited uses, online conduct rules, and privileges for access.
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Violation of the policy will lead to employee termination. This signed document by the

employee abiding with the policies will act as a contractual document.

The policy will have details on computer and internet access, unacceptable behavior,

security, copyright issues, acceptable means of communication via the company internet, and

consequences in violations. Some of the questions that will be answered in the policy are as

below:

1. Computer and Internet Access: Any Internet data that ABC's computer systems generate,

send, and receive will be regarded as official data. It is subject to disclosure and can only

be revealed for lawful reasons. The company will deem any equipment and technology

used to access the Internet as their property, and the firm will have the right to monitor

the activities of employees.

2. Unacceptable behavior: Sending confidential information to unauthorized recipients is

restricted and will be considered a breach. Downloading and uploading copyrighted

music or movies will be prohibited. Browsing potentially harmful websites that might

compromise company data will be considered as unacceptable behavior.

3. Security: Our company will ensure that anti-virus software will be installed on all

company laptops and computers. Employees found that disabling firewalls without

approval will have to face punitive consequences (Workable, 2020).

4. Copyright infringements: If an employee uses copyrights company information, this will

be considered a breach of IUP.

5. Communications: Any email or message that is sent using company internet by an

employee, the employee will be responsible for it.

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Al these points that will be included in the Internet Usage Policy will keep the company free

from any risks caused due to internet misuse.

Employee Internet Monitoring

To protect company ABC from compliance issues that could occur if employees are

found misusing work computers for improper or unlawful networking practices, or if the

productivity of the employees is declining due to use of the Internet for personal purposes during

working hours, once the Internet Usage policy is implemented, the company can employ internet

usage monitoring at the workplace. The Internet Usage policy will delineate the penalties for

violating the company Internet usage policy and the its right to monitor Internet use. For

example, suppose I notice that Employee A's monitor has a gaming website open in such cases.

In that case, company ABC has legal grounds to be doubtful that Employee A is misusing the

company internet and wasting company resources for online gaming during work hours which an

accurate reason for monitoring that employee's Internet use.

Ethical Decision-Making Framework

Ethical decision making for me, is rooted in the Utilitarian Approach. Using the

utilitarian method, we first define the different courses of action open to us in order to examine a

problem. Secondly, we ask who is impacted by each action and what advantages or liabilities are

created by each action. Thirdly, we choose the action that will yield the best advantages and the

least harm (University n.d).

If I were in the same scenario before learning about professional ethics, I would have a

chat with Employee C, who claims to be watching tutorial videos to help him during his

freelance work since he is my teammate and works on the same project that I am working on.
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Being unproductive directly affects the team's productivity and, therefore, brings a bad reputation

to the company.

By applying what I know about professional ethics, ethical decision-making will help me

identify unethical behavior and act accordingly. The ethical culture of my organization shows

that my company is ethically conscious. The opportunity for unethical behavior cannot be

eradicated without the implementation of codes and rules (Ferrell et al., 2019). My values

influence my ethical decision and responsibilities in the workplace. My values resonate with the

Normative approach of being honest and fair (Ferrell et al., 2019).

When the company implements an Internet Policy, by signing the Internet Usage Policy

and having other employees sign the policy, I will be obligated to ensure I make the right choice

and follow the company's guidelines and moral rules. If I report Employee C to the H.R.,

Employee C will have to face the consequences of violating the Internet Usage Policy and might

get terminated. This type of policy enforcement illustrates how the opportunity to commit

unethical acts can be eliminated or at least significantly reduced (Ferrell et al., 2019).

Pros of Selected Course of Action

Employees are unlikely to start browsing the Internet for personal use when they are

informed that their internet activities are being monitored.

Reviewing employee behavior helps the company track employees that don't follow

company standards. For example, that company will be able to track an employee indulges in

watching a sports league or browsing a social media platform like Instagram for a large amount

of time; time-tracking tools help monitor the number of hours your team works and how often
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employees report late to the office. By reviewing this data, the company can monitor employee

productivity.

Any form of virus or malware could seriously interrupt a business; this could be harmful

to productivity and will have an impact on company profits. Tracking employee activities on the

Internet drastically lowers the risk of an employee visiting a malicious website and ensures that

only work-related tasks are carried out. The cost of setting up an internet monitoring solution

would be significantly cheaper than coping with a substantial disruption caused by a virus

outbreak.

With the internet usage policy in place, most employees will not misuse their internet

privileges, and the internet monitoring system guarantees that internet access is only used for

business purposes.

Cons of Selected Course of Action

The Internet Monitoring System might lower the morale of employees who have been

efficient, loyal to the company, and hard working. Employees may feel that their managers don't

trust them to do their job right. A decline in productivity is often caused by low employee

morale, which can overshadow all the advantages of internet monitoring.

Employees feel their privacy is being abused as a result of internet monitoring. For

example, if an employee wants to access internet banking during his/ her break time, he/she

might feel uncomfortable if the company was monitoring their activities.

There are pros and cons as employers maintain productivity and while trying to keep

employee morale high.

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Soundness of the Course of Action

My action can be backed by statistic data that shows that an estimated 60% of companies

globally monitored social media accounts in 2015 (Long, 2017). Companies chose to monitor

internet activity to track idle time, showing how often the employee is away from their desk and

protects sensitive company data.

Studies on Internet monitoring have revealed that many employees indulge in gambling

and theft during work hours. Companies have discovered that significant amounts of time were

spent watching cat videos on YouTube and shopping on eBay. Statistics suggest that 63% of

U.S. employers monitor their employees' Internet connections, and the studies have revealed that

64% of employees use the Internet for personal reasons during business hours (Long, 2017). 77%

of major US companies monitor employees at work through email, web browsing, phone calls,

computer files, video recording (Long, 2017).

Conclusion

The purpose of this case study was to examine the misuse of company internet by

employees at workplace. The case study analyzed a review of the case, case analysis, and a

recommended case solution. Previous experiences, case studies and statistical studies as well as

current research were used to frame the discussion. The course of action was selected based on

the pros and cons of the different course of action. The conclusion is to enforce an Internet Usage

policy along with Employee Internet Monitoring.

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References

Ferrell, O.C., Fraedrich, J., & Ferrell, L. (2019). Business ethics: Ethical decision making and

cases (12th ed.).

Case, C. J., & Young, K. S. (2002). Employee Internet Management: Current Business Practices

and Outcomes. CyberPsychology & Behavior, 5(4), 355–361.

https://doi.org/10.1089/109493102760275608

Lichtenstein, S. (2011). Ethical issues for internet use policy: balancing employer and employee

perspectives. International Journal of Technology Management, 54(2/3), 288.

https://doi.org/10.1504/ijtm.2011.039316

R. Johnson, P., & Rawlins, C. (2008). EMPLOYEE INTERNET MANAGEMENT: GETTING

PEOPLE BACK TO WORK. Journal of Organizational Culture, Communications and

Conflict, 12(1). https://doi.org/10.1037/e541972009-017

Long, P. (2017, September 15). The Case for Employee Monitoring and Usage Policies.

https://www.askbis.com/employee-monitoring-usage-policies/.