The Risks of Wearable Tech in the Workplace

Mike Heembrock


February 2, 2015

Wearable Tech in the Workplace

New wearable technology has begun to make everyday life seem like something from a science fiction movie. Wristbands remind you to get up from your desk and stretch. Watches let you speak with someone halfway around the world. Sensors woven into clothing detect amounts of UV ray exposure. Eyeglasses take video and send the images in a split second.

Wearable technology has been a hot trend in the consumer market and sales are expected to soar. A recent report by Strategy Analytics predicts global wearable device wholesale revenues will grow 3,200% between 2013 and 2020, and the smartwatch and smartglasses categories will dominate total wearable device revenues for the next decade.

While much of today’s consumer wearable technology consists of health monitors that record calories, sleep patterns and the number of steps walked in a day, some of the new technology offers very sophisticated capabilities in tiny, unobtrusive packages.

But with each advance, wearable technology brings both new opportunities and new risks. Corporate espionage is a serious concern, as employees may soon be wearing watches, glasses, bracelets and other kinds of technology that can record private conversations, take photos or share information online. Some of these capabilities currently exist with smartphones and other mobile technologies, but wearables can be even more easily concealed, allowing bad actors to pass under the radar.

While corporate espionage by a rogue employee is one concern, good employees could also be turned into unwitting accomplices if their wearables are hacked or even controlled remotely by those with sinister intentions.

This technology also presents a cybersecurity risk. Devices that are plugged into a corporate laptop or desktop through a USB port could introduce viruses or malware into the company’s system. Private corporate information could be downloaded onto the device, resulting in the exposure of customer or vendor information such as social security or credit card numbers, which may result in financial and reputational damage for the employer.

These wearable devices also may contain legally protected personal information, such as details about an employee’s health. Unauthorized access of an employee’s personal data poses a risk of privacy violations. Businesses and healthcare organizations must be mindful about privacy risks, the potential for unauthorized access of personal information and the liability risk associated with a failure to protect it.

In spite of the dangers, wearable technology also offers interesting potential for managing risk and reducing liability. Wearables have already begun to transition from novelty items for use in health and fitness to tools that can bring enormous benefits in the workplace. Wearables are being put to use in fields where people may not typically have easy access to computers and do not always have their hands free, or where they may have to wear gloves or work in sanitized places, such as hospitals. Google Glass is being used by doctors to access patients’ electronic healthcare records, for example, while field service workers in the energy industry have begun using the device to assemble complex tools.

New uses are also being devised to address specific workplace concerns. In fields like construction, wearable technology may be able to inform workers if they are exceeding lifting thresholds, have been over-exposed to UV rays or are at risk of a slip and fall. According to a recent University of Michigan report, wearable technology may one day even be able to warn workers about hazardous leaks in a lab.

As the wearable technology market grows, businesses need to consider not only the possible applications on the job, but the potential risks as well. Businesses that already have policies in place regarding existing mobile technology ought to consider expanding their protocols to include this new class of wearable technology. They should also seek to monitor their corporate networks to identify when information is transmitted over the network and by what device. Risk managers should consult with legal counsel and work with their brokers to identify the risks, re-examine insurance policy limits and consider potential gaps in the scope of their existing insurance protection.
Mike Heembrock is a vice president and executive specialist in loss control services for the Chubb Group of Insurance Companies.