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Legal Issues with Independent Contractors Plugged into Your Electronic Resources

by David Micah Kaufman

Like many of us, several of my friends have recently suffered vocational dislocation (no matter what we name it, losing a job is still a tragedy). One of these friends called me a few weeks ago and told me he had landed a position as a independent contractor for a financial services company. As he described his responsibilities, it sounded an awful lot like a “job” to me.

When we met for lunch the next week, I was amazed at how little distinction his new “employer” made between him and the other regular employees — especially electronically. He had an e-mail address from the company, a BlackBerry issued by the company, and apparently full access to the enterprise’s network. He even had a business card with the company’s logo on it.

Employers are struggling to achieve operational objectives while many are severely limited in their ability to hire new personnel. Therefore, they’re resorting to hiring independent contractors and other non-employees. Getting work done in the modern company is so dependent on having access to the technology, data, and communications infrastructure of the organization that most companies are reluctant to create obstacles to this access.

Unfortunately, non-employees are exactly what their names imply — they are not employees of the company. They are not bound by the policies of the company, they may also do work for other companies (including a company’s competitors), they may not have been screened by HR, and they aren’t subject to the same supervision as company employees.

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Just like an employee
In many organizations, these non-employees look no different, especially electronically, than employees. They are routinely given e-mail addresses that look identical to those used by employees. Furthermore, they are on office, group, and division e-mail distribution lists. No-nemployees frequently have access to intranets and other collaboration sites — just like company employees. They create documents that are saved on a document management system and access said system as a company user.

Risks of independent contractors
So what are the risks? My friend should have been hired as a “real” employee of the company. Importantly, he could have been an employee — but he isn’t. He could be working for several companies. He never signed the company’s electronic-use policy. People to whom he sends e-mails have no idea that he isn’t an employee. His “supervisor” is a clerk in a professional employer organization. He has a very short-term outlook for his employment.

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Keeping your company’s electronic resources safe
If you have non-employees who are electronically connected to your company, you should consider some important protocols to protect your organization:

  • Information. Make sure you have a comprehensive informational record (name, address, work history, etc.) on all contractors who have access to your system, communications infrastructure, data, and technology.
  • E-mail addresses. Independent contractors and all non-employees that have company e-mail addresses should have a distinguishing feature of the address that indicates that they are non-employees. For example, if the standard address is, contractors should be given addresses that clearly indicate that they aren’t employees, i.e., Also, make sure that non-employees aren’t on general e-mail distribution lists.
  • Intranet and document management system (DMS) access. Non-employees’ access to the company’s intranet and DMS should be strictly limited to that information to which they absolutely need to have access. Their access should be reviewed and monitored.
  • Policies. All individuals who have access to company technology and electronic communications should be required to agree to an electronic-use policy, which governs their use of the company’s systems and equipment and non-disclosure and confidential information policy.
  • Hardware, phone numbers, and business cards. Employers should be reluctant to give non-employees equipment and phone extensions. In addition, make sure that business cards and voice-mail messages clearly indicate they aren’t company employees.
  • Limited access. Non-employees’ electronic access should end at a certain time and should need to be reinstated. Independent contractor roles and assignments can change and a non-employee could no longer need the access they were previously given.

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Good fences make good neighbors
The procedures and protocols discussed above shouldn’t be required because non-employees aren’t to be trusted. The fact is, simply, that they aren’t company employees. They aren’t better or worse, just different. Therefore, the electronic protocols need to treat them differently — no matter how much they look like regular employees.

David Micah Kaufman is the founder of BIGGER PIES! — a boutique professional services consulting firm in San Francisco — and a regular contributor to HR Insight and HRIT. You can reach him at (415) 272-8115.