New Jersey Supreme Court Favors Employees in Analyzing Their Personal E-Mails Sent on Company-Owned Computers

May 19, 2010

Nationally, courts have disagreed about the effectiveness of company personnel policies which purport to exert ownership of all employee e-mails sent or received on company-owned computers. Some courts have pointed to such policies in depriving employees of any personal attorney-client privilege that might otherwise protect such e-mails. Other pro-employee courts have found company policies ineffective – sometimes pointing to the lack of clarity or specificity in the personnel policies. Most companies update their personnel policies as these cases appear. For instance, companies now routinely apply their policies to employees’ personal password-protected web-based e-mails sent on company-owned equipment.

In Stengart v. Loving Care Agency, Inc., 990 A.2d 650, 659 & 665 (N.J. 2010), the New Jersey Supreme Court essentially drew a line in the sand – holding that because of the “important public policy concerns underlying the attorney-client privilege,” it simply would not enforce “even a more clearly written company manual” that “provided unambiguous notice that an employer could retrieve and read an employee’s attorney-client communications, if accessed on a personal password-protected e-mail account using the company’s computer system.” This appears to be the first time a court has adopted such a flat prohibition, rather than focusing on some ambiguity or gaps in a company’s personnel policy.

Companies should continue updating their personnel policies to satisfy courts focusing on the language of such policies, but it looks as if even an unambiguous policy might be unenforceable in some states. Ominously, the New Jersey Supreme Court found that the company lawyers’ review and use of Stengart’s e-mails violated the New Jersey ethics rules, and remanded so the trial court could decide “what sanctions to impose.” Id. at 666.