HSBC accused of privacy breaches for recording employee phone conversations
HSBC recently faced allegations of violating section 632(a) of the California Invasion of Privacy Act for intentionally recording confidential calls without consent and section 632.7(a) of the Act for intentionally recording calls to cellular and cordless phones also without consent.
The plaintiff in this case received hundreds of personal calls from her daughter, who was an employee at the HSBC Card Services call center in Salinas, California. HSBC’s full-time recording system recorded these calls.
“Inside HR” – which housed HSBC’s global, company-wide human resources policies – included an electronic monitoring and device use policy, which provides the following:
- HBSC periodically monitors and/or records certain employee telephone conversations
- Employees may use telephones for occasional non-work purposes
- Personal calls may be recorded but should never be monitored
- The monitoring should be discontinued immediately once the person monitoring identifies that it is a personal call
HSBC’s Salinas facility also had a set of written workplace policies called “Scout.” This included the following. First was the call avoidance policy, which barred employees from making outbound calls to avoid taking inbound ones. Second was the policy for “Recording Disclosure to Third Parties,” which applied when a non-card member was on the line.
Third was the “Call Cardmember Procedure,” which suggested dialogue for calls to resolve disputes. This procedure stated that the call “may be recorded and monitored for quality assurance purposes” and that the recording should be disclosed to third parties.
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The trial court ruled in HSBC’s favor. It determined that the plaintiff failed to prove lack of consent and HSBC’s intent to record. It also found that the plaintiff impliedly consented to being recorded. The plaintiff appealed.
HSBC wins at appeal court
In the case of Rojas v. HSBC Card Services Inc. et al, the California Court of Appeal for the Fourth District, First Division affirmed the judgment of the trial court.
First, the appellate court accepted that substantial evidence did not support that HSBC had no intention to record the calls between the plaintiff and her daughter.
HSBC managers knew that personal calls – including confidential calls and calls received on a cellular or cordless phone – were happening, and the daughter’s manager permitted such calls, the appellate court found.
HSBC had a full-time recording system in its Salinas facility and had policies that did not prevent personal calls, regardless of whether the employees making them were subject to progressive discipline, the appellate court added. HSBC’s HR policy for electronic monitoring stated that employees “may use” telephones “for occasional non-work purposes” and that “personal calls may be recorded.”
A company’s “full-time recording of calls without adequate notice creates conditions ripe for potential liability under the Privacy Act, and workplace policies prohibiting personal calls may not mitigate that risk,” wrote Justice Joan Irion for the appellate court.
Despite these findings, the appellate court decided that it had to uphold the trial court’s judgment because substantial evidence supported that the plaintiff impliedly consented to being recorded.
The plaintiff was notified that the calls were subject to recording and participated in numerous calls that her daughter made from an HSBC call center phone even after receiving the prior recording disclosures, the appellate court concluded.
