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Cloud Concerns for Employers: Part 2

Earlier this week, I discussed the possibility of increased wage and hour claims that go along with the increased use of cloud platforms. Today, let’s explore another potential problem that clouds can cause in the workplace.

In 2013, a case from the Southern District of New York illustrated that the use of the cloud for business purposes can give rise to legal issues related to employee access and ownership. In Schatzki v. Weiser Capital Management, LLC, No. 10 Cvi. 4685, 2013 WL 6189465 (S.D.N.Y. Nov. 26, 2013), a financial planner sued her former employer for taking her client files that were stored in a cloud-based data program licensed to her. When she joined Weiser Capital Management years earlier, the employee brought the program license and client files along with her. After termination, the employer copied her client list and changed passwords so that the ex-employee could no longer access the information stored in the cloud. The court held that the employer’s password changes and refusal to turn over the files resulted in conversion.

This is no doubt one of many cases that will emerge as employers and employees begin to argue over who has access to and ownership of cloud information. Unlike paper files stored on-site, a disgruntled employee could continue to access files in the cloud long after dismissal if appropriate measures are not taken. Employers should institute written policies about cloud ownership and access for current and former employees, so as to mitigate such problems.

If you have questions about cloud computing or social media policies for your employees, contact a McBrayer employment law attorney today.

This article is intended as a summary of  state and federal law and does not constitute legal advice.

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