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Pirated Software Creates Substantial Risk for Employers

by Saul C. Glazer

Ignorance of pirated software on company-owned computer networks isn’t bliss. Given the widespread use of the Internet, a company’s employees may be downloading unlicensed, pirated software without its knowledge, and the employees may not even realize that what they’re doing is illegal

Although employers may find it burdensome and costly to monitor what your employees are downloading, it’s imperative to put controls in place to protect your organization from the liability of having pirated software on your computer network.

HR Guide to Employment Law: A practical compliance reference manual covering 14 topics

Looting the Internet’s treasures
As litigation over software piracy claims increases, employers should be aware of the consequences of using pirated software. Groups like the Business Software Alliance (BSA) that work with companies like Microsoft have initiated reward programs offering up to $1 million to employees who “turn in” their employers for software piracy.

Being in possession of pirated software can lead to both civil and criminal charges resulting in copyright infringement fines of up to $150,000 per violation and even prison time for company executives. In addition to the legal ramifications, pirated software can expose your computer network to viruses and other corruption.

Consider taking the following steps to prevent the introduction of pirated software onto your company’s network:

  • Retain a knowledgeable IT person or department to ensure compliance with software-licensing requirements and to formalize your software policies.
  • Distribute written software policies to all employees, and set forth substantial consequences for downloading unauthorized software.
  • Have your IT personnel monitor employees’ Internet use, and use filtering software to block workers’ access to specific content and websites.
  • Restrict employees’ ability to download to the network so that only designated people like IT personnel have the right to purchase, install, or download software.
  • Audit your computer network periodically to ensure that all software is properly licensed. Immediately delete any unlicensed software.
  • Maintain detailed records for all software that’s purchased so if a question ever arises, you can provide the proper license information.

Audit your organization’s Internet and e-mail policies with the Employment Practices Self-Audit Workbook

More information, to boot!
For more information on how to protect your company from liability for software piracy, visit the BSA website at The website offers many helpful tools, including free trials of software audit programs, sample policies and memos to distribute to employees, antipiracy posters to hang in the workplace, and tips on how to prevent software piracy.

In addition, the Software & Information Industry Association website, located at, offers detailed information on what exactly constitutes piracy, the different types of liability involved with piracy, and the applicable laws governing software use.

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