India: Need For Having Security, Email & Internet Usage Policy In Companies - Legal Requirements And Implications

Last Updated: 12 September 2017
Article by Vijay Pal Dalmia, Partner

Article by Vijay Pal Dalmia, Advocate, Supreme Court of India and Delhi High Court, Partner & Head of Intellectual Property Laws Division, Vaish Associates Advocates, India
Mobile: +91 9810081079 email: vpdalmia@vaishlaw.com

All organizations must have a robust IT Security, Email & Internet Usage Policy, which should be strictly implemented to establish standard practices and rules for responsible, safe and productive use of the Electronic mail (e-mail) and the internet; and to ensure the protection of information/data of the Organisation and prevention of any misuse thereof.

It is a fact of life that most of the Organisations do not have any Data, IT Security, Email & Internet Usage Policy, or may be having inadequate policies, which fail to protect and safeguard the interest of the organizations and their management, leading to the risk of unwarranted criminal and civil consequences.

The effective implementation of policies for the protection of data, misuse of internet and emails, becomes difficult in the court of law in the absence of a well-defined policy, which is duly acknowledged by the employees of the organizations. The safeguard of data, e-mail system and network of an Organisation has come to play an extremely vital role in today's fast moving, but invariably technically fragile, business environment. The first step towards enhancing a company's security is the introduction of a precise yet legally enforceable security policy, informing employees/staff on the various aspects of their responsibilities, general use of company resources and explaining how sensitive information must be handled. The policy should also describe in detail the meaning of acceptable use, as well as clearly list the prohibited activities.

WHY SHOULD AN ORGANIZATION HAVE AN IT POLICY?

  • Because an organization, its officers including its Directors and Principal Officers, may be directly and vicariously liable for the acts of organizations' Employees and Agents, etc.,

    • Under the law relating to

      • Strict Liability,
      • Vicarious Liability.
  • Because Data Protection and Secrecy has become the norm of the day, and it's obligatory to protect data.
  • Because every organization is legally obliged to protect its employees, clients and customers from illegal, unauthorized, inappropriate and unwarranted

    • Use of

      • Email;
      • Internet Usage;
      • Laptop/Desktops;
      • Hardware;
      • Data card;
      • Pen Drive.
  • Because all organizations need to secure

    • Computer Network; and
    • Against Unauthorized System Access to prevent data theft, virus, and malware attacks.
  • Because every organization needs to prevent its employees from installing illegal software, directly through internet or CD's, etc., which exposes an organization to copyright violations. This can be effected by controlling software Installation Rights.
  • Because every organization has to create system back up and maintain its IT infrastructure.
  • Because every organization must control unauthorized Third Party and Remote Access to its computers and IT network.
  • Because Data of a Company includes its valuable Intellectual Property Assets, which may include

    • Patents,
    • Designs,
    • Copyrights,
    • Trade Secrets (Unpatented),
    • Customer Data,
    • Business Data,
    • Business Methods,
    • Third Party Data,
    • Formulas,
    • Source Code,
    • Employee Information.
    • Know-how
    • Confidential Information
  • Because an organization may be under a LEGAL & CONTRACTUAL OBLIGATION:

    • to protect the Sensitive Personal Data of its customers and employees, under the Information Technology Act, 2000; and

      • in case of violation of your organization's legal obligation,

        • All persons who are directly responsible for the day to management of your organization including its directors and principal officers may be held legally liable for

          • Civil action, i.e., compensation under Section 43A, and
          • Criminal action, i.e., Punishment under Section 72A,

            • For failure to protect any sensitive personal data which its owns, controls or operates.
    • As Information Technology (Reasonable security practices and procedures and sensitive personal data or information) Rules, 2011

      • provide for having Mandatory Privacy Policy for protection of sensitive personal data.
    • The organization and it's all principal officer and directors may be held liable,

      • to pay Compensation,

        or
      • for Criminal Prosecution for

        • Negligent handling of data or information leading to DEFAMATION; or
        • Use of unauthorized or pirated software.
    • The organization and it's all principal officer including its directors may also be held liable for criminal prosecution,

      • Tampering of computer source documents- u/s 65 of the IT Act, 2000,
      • Sending of offensive messages u/s 66A of the IT Act, 2000 through

        • Computer resources & Communication devices,
      • Punishment for identity theft- u/s 66C of the IT Act, 2000,
      • Use of computer resource for cheating by impersonation- u/s 66D of the IT Act, 2000,
    • Violation of privacy by use of electronic means of a company- u/s 66E of the IT Act, 2000,
    • Publication or transmission of obscene material in electronic form- u/s 67 of the IT Act, 2000.

It is important to note that Information technology resources (IT resources) of a company may include:

  • computers,
  • computer-based networks,
  • computer peripherals,
  • operating systems,
  • e-mail,
  • Intranet,
  • software or any combination thereof

    • that are made available by a Company to support its goals of providing quality products and services to customers, increase shareholder value and foster employee satisfaction.

TO WHOM DOES IT POLICY APPLY?

IT Policy of the organization should be universally applicable across the organization, including its

  • Directors
  • Employees,
  • Part-time employees,
  • Industrial Trainees,
  • Contractors,
  • Agents,
  • & all others, who may be directly or indirectly associated with the conduct of the business of the organization.

ADVANTAGES OF HAVING AN IT POLICY:

  • Time Management, as office hours can be used only for official work thereby enhancing productivity.
  • Optimum and efficient utilization and management of company resources including computer resources for maximum efficiency.
  • Maintaining healthy, cordial and predefined Employer & Employee Relationship.
  • Customer Relationship.
  • Prevent Poaching of your human resource.
  • Leads to Reduction in the risk of use of pirated and unauthorized use of the software.
  • Authorized Official use of Company network and resources can improve the functioning of IT system, which also leads to Bandwidth Protection.

OBJECTIVES & PURPOSE OF HAVING AN INFORMATION TECHNOLOGY POLICY:

Having a well-defined and comprehensive Information Technology Policy may result in:-

  • Establishing a culture of security and trust for all employees;
  • Providing guidelines governing proper use of IT and Internet by all employees;
  • Ensuring the use of internet only as a tool for continuous improvement of efficiency and performance;
  • Fixing the responsibility & liability in case of misuse of IT resources;
  • Preserving the integrity of the information technology systems;
  • Protecting IT systems against the accidents, failures or improper use;
  • Controlled right to access confidential data;
  • Controlling of copying, removal or alteration of any data, file or system resources;
  • Maintenance of a high level of professionalism in keeping with Code of Ethics;
  • Maintaining Company's reputation among trade and public;
  • To supplement, not replace, all existing laws, regulations, agreements, and contracts.

IT POLICY IS THE WAY TO GO AHEAD, AS:

  • Most of our communications are now electronic.
  • Recipients of electronic documents, like

    • agents,
    • distributors,
    • Customers etc.

      • Need the source and authenticity of the documents or messages.
  • It may satisfy audit requirements.
  • It assists in compliance with applicable laws, Regulations, Guidelines, and recommendations.
  • It mitigates risk from a security breach.
  • Such policy educates users on sound security practices, and
  • Having such a policy leads to a reduction of legal risk.

RISK FACTOR INVOLVED IN NOT HAVING AN EFFECTIVE POLICY:

  • Espionage: Employees are falling to the lure or trap of RIVALS, and passing sensitive and secure data of the organization.
  • Damage to Goodwill, Reputation, Credibility of the organization.
  • Harassment: Viewing inappropriate content, such as pornography, hate or violence, can create an environment that is hostile and offensive for co-workers, and can damage the reputation of the organization.
  • Viruses: Visiting less than reputable websites can lead to viruses, spyware, or other malicious software getting into the network.
  • Productivity: Frequent online browsing, shopping, and chatting can get in the way of getting the work done, and often leads to resentment from the coworkers.
  • Service Interruptions: Large downloads and streaming audio and video can suck up network resources that other employees need to do work and service customers

The content of this article is intended to provide a general guide to the subject matter. Specialist professional advice should be sought about your specific circumstances. The views expressed in this article are solely of the authors of this article.

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Vijay Pal Dalmia, Partner
 
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