Privacy and Fairness of EPM

When examining issues of privacy, a common theme is the idea of control. For instance, Stone and Stone defined privacy as:

[A] state or condition in which the individual has the capacity to (a) control the release and possible subsequent dissemination of information about him or herself, (b) regulate both the amount and nature of social interaction,(c) exclude or isolate him or herself from unwanted (auditory, visual, etc.) stimuli in an environment, and as a consequence, can (d) behave autonomously. (Stone & Stone, 1990,p . 358)

Perceptions of privacy, then, follow from an ability to control and regulate personal information. Although the specter of privacy invasion surrounds the use of EPM, only recently has privacy been investigated as an important variable in predicting reactions to EPM. Most of what we know about the effects of monitoring on perceptions of privacy invasion comes from investigations of drug testing. For example, Stone and Koch (1989) found that advance notice of drug testing mitigated employee perceptions of invasiveness. Racicot and Williams (1993) found that the sensitivity of the job in question mitigated the perceived invasiveness of drug testing. A few recent studies, however, have examined privacy in the context of EPM. For example, Alge and Ballinger (2001) found that advance notice of monitoring mitigated participants privacy concerns. As implied by the definition of privacy above and supported by research evidence, employees need to feel that they have some control over how their personal information is used and how the use of this information will influence their outcomes (e.g., performance ratings, distribution of rewards).

Employees are not only concerned with having control over outcomes; they also want to know that the procedures used to make decisions and determine outcomes are fair. Fairness can be conceptualized as a subjective judgment of what is right and wrong with respect to outcomes, procedures, and interactions (Tyler, Boeckmann, Smith & Huo, 1997). This is a broad definition of fairness that can be broken down into concerns about the distribution of outcomes (distributive fairness; Adams, 1965), concerns about the procedures used to determine outcomes (procedural fairness; Thibaut & Walker, 1975), and concerns about the interpersonal enactment of decision-making procedures (interactional fairness; Bies, 1987). It has been well established that distributive and procedural fairness perceptions play a key role in determining reactions to EPM. For example, Kidwell and Bennett (1994), Niehoff and Moorman (1993) and Westin (1992) all found that individuals do make fairness perceptions about EPM. Drawing on the existing research, Ambrose and Alder (2000) outlined a model for enhancing fairness perceptions toward EPM. Specifically, they suggested that employees will experience greater fairness if EPM systems are designed to respect distributive and procedural justice criteria. For example, Ambrose and Alder proposed that in organizations where efficiency and profit are stressed, EPM systems that focus on individual versus group performance will be perceived as more distributively fair. Furthermore, procedural fairness will be enhanced if, for example, employees are offered an opportunity to offer their input into EPM system design.

Despite the research evidence pointing to the independent relationships between privacy and EPM, as well as between fairness and EPM, we are now discovering that privacy and fairness together play a role in determining reactions to EPM. Indeed, the explanations presented above for privacy and fairness imply that these constructs are distinct. However, although their literatures were initially developed separately, they turn out to be quite similar (Bies, 1993; Eddy et al., 1999). In fact, Bies (1993) has argued that privacy becomes a procedural justice issue when people s moral expectations about control over their personal information are violated (p. 72). For instance, when more personal information is released, employees will experience higher privacy invasions (Kidwell & Bennett, 1994), and higher privacy invasions will be perceived as less fair (Ambrose & Alder, 2000). Further, correlations between privacy and fairness perceptions have been moderate to high (Eddy et al., 1999). This led Bies (1993) and Eddy et al. (1999) to call for increased examination of these concepts as related constructs.

Responding to this call, researchers are now examining the dual relationship between privacy and fairness. For example, Alge (2001) examined organizational privacy in the context of EPM and found that the relevance of data being collected by electronic monitoring was negatively related to invasion of privacy perceptions and positively related to fairness perceptions. Furthermore, allowing people to voice their opinions about EPM was negatively related to perceptions of privacy invasion and positively related to procedural justice judgments . Finally, perceptions of privacy invasion were negatively related to perceptions of fairness. Eddy et al. (1999) also found that the ability to authorize disclosure of information and knowledge of the target of disclosure affected both privacy and fairness perceptions toward a human resources information system that collected personal data. These researchers concluded that privacy could be conceptualized as an antecedent to fairness. What this means for electronically monitored employees is that system characteristics that are designed to respect employee privacy will be perceived to be more fair. In turn, enhanced fairness leads to more positive reactions to EPM. But is this the answer for mitigating the negative effects of monitoring? Perhaps, but it s not the whole story.