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Today, conversations and telephone calls can be easily and discreetly recorded. This can pose ethical and legal problems, including in the workplace.

Consider, for example, the following scenarios:

Hypothetical #1: You own and manage your own company. One of your employees has been under-performing and causing issues with other personnel for months. You have taken several reasonable steps, including implementing an employee-improvement plan, but the employee’s performance has not improved. You are tasked with terminating the employee, but you anticipate major push back, including that the employee may try to file a lawsuit against the company.

Seconds before the employee comes into your office to discuss termination, you hit record on your phone, which will sit out of view on your desk during the meeting. If the matter later wound up in administrative proceedings or in court, the audio recording could provide a clear record that the employee was terminated for legitimate, objectively reasonable reasons.

Hypothetical #2: You are an administrative employee at a small company. Several of your coworkers routinely make borderline inappropriate comments to you, including your immediate supervisor. Recently, your supervisor’s comments have crossed the line; you can no longer work in such an environment. You have tried to bring up the issue with the company’s human resources staff, but it has not gone anywhere.¹

You have decided to file a harassment claim with the Wisconsin Department of Workforce Development (“DWD”). But, before you leave the company, you want to gather clear-cut evidence to support your claims. You bring a small recording device with you to work to get any future comments “on the record.”

On one hand, the people recording the conversations have arguably legitimate reasons for doing so. On the other hand, there are privacy and confidentiality issues, as the other party does not know he or she is being recorded.

So: is the recording allowed? This article will provide a brief overview of state laws on the topic and explore other potential issues that arise when employers institute a “no-recording” policy.

State Laws Take Two Different Approaches: “One-Party Consent” or “All-Party Consent”
The answer to whether a recording is allowed depends on your state’s laws on the issue. Taping a particular conversation may be allowed under Wisconsin law, whereas the same recording may be prohibited in California (and certain other states). There is a clear division between state laws that require all party’s to consent before a recording is allowed (the minority view) and states that require just one party to consent before a record is legal (the majority view).

One-Party Consent States:
Most states are “one-party consent” states, meaning recordings are allowed as long as just one party to the conversation or phone call consents to the recording. This is true even if the consenting party is the one hitting the record button. Federal law takes this approach, as well. (18 U.S.C. Sec. 2511). One-party consent states usually allow a participant to the conversation to authorize a third-party to record the communication.

Wisconsin is a one-party consent state. Wis. Stat. § 968.31 provides that, “it is a felony to record an oral or telephone communication without the consent of at least one party, or with the intention of committing a crime or a tort. Illegal recording may also give rise to civil liability.” (emphasis added). Other states’ statutes use similar language:

Under Minnesota statute, it is “legal to record an oral or telephone conversation with the consent of one or more parties, provided there was no criminal or tortious intent. Unauthorized recording in violation of this law can lead to jail time, fines, and/or civil liability.” See Min. Stat. § 626A.02 (emphasis added).
New York state law provides that, “it is illegal to record in-person or telephone conversations without the consent of at least one party.” N.Y. Penal Code §§ 250.00, 250.05 (emphasis added).

All-Party Consent States:
On the other hand, a minority of states take a more private approach, requiring all parties to a conversation to authorize and consent before a recording is taken. These are referred to as “all-party consent” states. California and Illinois are examples of states that fall under this category.

Under California law, it is a crime punishable by fine and/or imprisonment to, “without the consent of all parties to a confidential communication, use[] an electronic amplifying or recording device to eavesdrop upon or record the confidential communication.” See Cal. Penal Code §§ 632. The California Supreme Court has defined a confidential conversation as one in which the parties have a reasonable expectation that no one is listening in or eavesdropping. Flanagan v. Flanagan, 41 P.3d 575 (Cal. 2002).

Illinois law also requires all parties to consent to a recording, if the location of the conversation suggests there is a “reasonable expectation of privacy.” IL St. Ch. 720 Sec. 5/14-1.

Can an employer implement a “no-recording” policy?
In one-party consent states such as Wisconsin, employers may consider creating a company policy prohibiting secret audio or video recordings. Even though state law allows surreptitious recordings, an employer may prefer to turn its workplace into an all-party consent space by including a “no-recording policy” in its employee handbook. In recent years, courts and administrative agencies have begun deciding when “no-recording” policies are permissible—and when they might not be.

Some courts have found that no-recording policies infringe employees’ ability to engage in “protected concerted activity” under the National Labor Relations Act.² Recent decisions on the issue include the following:

The Second Circuit Court of Appeals agreed with the NLRB’s prior decision that Whole Foods’ no-recording policy was too broad, because it prohibited all recordings unless store management gave prior approval. Whole Foods Mkt. Grp., Inc. v. Nat'l Labor Relations Bd., 691 F. App’x 49, 51 (2d Cir. 2017).
The Fifth Circuit agreed with the NLRB’s finding that that T-Mobile’s no-recording policy³ was similarly over-broad because it, “encompasse[d] any and all photography or recording on corporate premises at any time without permission from a supervisor.” T-Mobile USA, Inc. v. Nat'l Labor Relations Bd., 865 F.3d 265, 274 (5th Cir. 2017). The Court stated that, “a reasonable T-Mobile employee, aware of his legal rights, would read the language of the recording policy as plainly forbidding a means of engaging in protected activity.” Id.

More recently, however, the NLRB appears to be taking a more employer-friendly approach. It found that no-recording policies are generally permissible, provided that they are supported by a legitimate, facially neutral justification. For example, in December 2017, the NLRB upheld Boeing Corporation’s “no-camera” policy. See Boeing Co., 365 NLRB No. 154 (Dec. 14, 2017). In the decision, the NLRB also created a new framework for considering employee handbook policy, putting “no-camera” or “no-recording” policies in the least scrutinized category of policies. Id.

This approach was reiterated in a Memorandum by the NLRB General Counsel, which stated that employers have legitimate reasons for banning secret recordings, such as facilitating open discussion and exchange of ideas, protecting privacy, property, and proprietary and confidential information, avoiding legal liability, and maintaining the integrity of operations. The Memorandum found that, because no-recording policies are generally presumed to be lawful, there must be a specific showing that the policy was applied in a way that violates the protections of the NLRA in order to be struck down.

Best Practices:
Employers in one-party consent states that wish to implement a legally permissible no-recording policy should take the items below into consideration. To increase chances that a no-recording policy will be upheld and enforced, the policy should:

List the purposes for implementing the policy. As prefaced above, these may include: (a) promoting open employee communication in the workplace; (b) protecting employees’ (and customers’) privacy interests; (c) protecting the company’s proprietary and confidential information from unauthorized disclosure; and (d) reducing the company’s legal liability.
Limit the scope of the policy. The Court in Whole Foods said that the company should be able to, “craft a policy that places some limits on recording audio and video in the work place that does not violate the Act,” by simply narrowing the policy’s scope. There are numerous ways to limit the scope of a no-recording policy. For example, consider adding limiting language to clarify that employees may record to document unsafe or hazardous conditions and specific grievances.
Expressly state that the policy does not prohibit employees from exercising Section 7 rights. A policy that contains an express carve-out stating that it does not limit employees from engaging in “protected concerted activities,” courts or administrative agencies may be more likely to find the policy permissible.

If you have any questions about implementing a no-recording policy into your Company’s employee handbook, or any other employment-related issues, please do not hesitate to reach out to Kai Hovden at (608) 252-9391 or ckh@dewittllp.com or another DeWitt LLP Labor & Employment Law attorney.

THE ABOVE COMMENTARY SHOULD NOT BE CONSTRUED AS LEGAL ADVICE. IT IS BEING PROVIDED FOR GENERAL INFORMATIONAL PURPOSES ONLY.

¹ This hypothetical is based on a recent Seventh Circuit case. In Swyear v. Fare Foods Corp., No. 18-2108 (7th Cir. 2018) the plaintiff, a sale representative for Fare Foods Corporation (Fare Foods), filed a Title VII discrimination complaint when she was terminated a few months after she complained to management about an environment of offensive and vulgar name-calling by some of her co-workers, including the sales manager, and a specific uncomfortable interaction with a coworker on a business trip.

² Section 7 of the Act guarantees employees the right “to engage in . . . concerted activities for the purpose of collective bargaining or other mutual aid or protection.” 29 U.S.C. § 157. It is “an unfair labor practice for an employer . . . to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in section 157 [(“Section 7”)].” 29 U.S.C. § 158(a)(1).

³ For reference, the language of T-Mobile’s policy is replicated below:
To prevent harassment, maintain individual privacy, encourage open communication, and protect confidential information employees are prohibited from recording people or confidential information using cameras, camera phones/devices, or recording devices (audio or video) in the workplace. Apart from customer calls that are recorded for quality purposes, employees may not tape or otherwise make sound recordings of work-related or workplace discussions. Exceptions may be granted when participating in an authorized [T-Mobile] activity or with permission from an employee’s Manager, HR Business Partner, or the Legal Department. If an exception is granted, employees may not take a picture, audiotape, or videotape others in the workplace without the prior notification of all participants.