When trying to identify any potential misconduct, banks should take into consideration staff relations when turning to big data. There are a number of genuine reasons why banks would want to monitor the behavior of their staff by making use of big data analytics however they should also consider the relationships between employees before doing so. A report by the Financial Times suggests that some banks have started to monitor the performance of their traders against the number of times they make use of the internal communications systems.
The main reason behind monitoring is to identify whether or not traders are contacting clients in a covert manner and earning profits illegally. Banks also monitor mobile phones and also make use of data to log how many times a trader takes a break to smoke outside to identify any suspicious behavior.
According to Michael Ruck, a financial services litigation and compliance expert, it is understandable as to why banks would look to big data to monitor their staff due to the penalties that could result from insider trading. However this must be done by keeping into consideration employee relations and legal issues. He also stated that while it may be clear that banks and similar institutions should be able to evidence the appropriate steps they are taking for monitoring their employees; increasing financial penalties only intensify the level of scrutiny placed on the activities performed by individuals in these institutions. There needs to be a balance as there could be negative impacts from such behavior and could result in those acting properly to get caught up in the investigation process as well.
One issue which banks face is that employee monitoring technologies can be non compliant with data protection and privacy laws. Banks need to be open with their employees regarding the use of such technologies according to Kathryn Wynn, a data protection specialist.
She also goes to say that everything should be done along the lines of what the employee expects with respect to monitoring unless the bank comes across some suspicious behavior. After that, it is more about ensuring that the monitoring is done appropriately without any risk and is conducted in the least intrusive way.
When monitoring isn’t conducted on the content of any communication, it is easier to justify from the perspective of data protection law compliance. However this does cause incorrect inferences to be made from the data.
According to Annabelle Richard and Guillaume Bellmont, technology and privacy law experts in Paris, businesses which monitor their employees must notify the authorities of the tools they are making use of. A judgment was issued by the Court of Cassation in France which stated that employers could lose on cases brought against them by employees on the grounds of unfair dismissal if they do not make open their employee monitoring system. Furthermore, Selwyn Blyth, an employment law consultant says that banks should have a clear policy making explicit what they are going to monitor and for what purpose. The policy can be made public to the staff and employees can also be asked for their signed consent.