Many companies use “keylogging” software or hardware to monitor employees’ computer use. But they might be in trouble, according to this recent court case.

Keystroke logging (often called “keylogging”) is a process in which everything someone types on a keyboard is recorded, by either a piece of software or a hardware device installed between the keyboard and CPU.

Hackers often spread viruses that install keyloggers on victims’ computers to steal bank passwords, credit card numbers and other sensitive information. But they’re also regularly used by businesses to monitor what employees do on their office computers.

And that might violate the law, according to a recent court decision:

After Metteyya Brahmana was laid off, he had a dispute with his former boss about back wages he claimed he was owed. During the conversation, the supervisor allegedly made reference to an e-mail Brahmana had sent to an attorney with his personal e-mail account.

Brahmana concluded that the boss had accessed his e-mail. He also learned from a former co-worker that the company monitored all employees’ activities with keylogging devices.

He sued his former employer. His claim: The keylogging violated the federal Wiretap Act, which makes it illegal to “intentionally intercept … any wire, oral or electronic communication.”

The company tried to have the case dismissed. But the judge didn’t buy it.

The court ruled that accessing the e-mail didn’t break the law (because the law covers “intercepting” communication, not accessed stored messages), but that the keylogging itself may have been against the law.

The judge let the case move forward to trial, saying more information was needed to decide if the ex-employee has a case. We’ll keep you posted.

Either way, employers should be warned about the potential for keylogging and other monitoring tools to violate laws on privacy and electronic communication.

Cite: Brahmana v. Lembo