North Carolina Employee Monitoring Software: Insights for Small and Medium Businesses

North Carolina's small and medium-sized businesses face the pressure of digital security and maintaining productivity now more than ever, as the state's economy increasingly relies on technology and remote work. How can companies ensure their confidential data is safe and employees do their best?

This article examines the distinct challenges encountered by North Carolina small to medium-sized businesses (SMBs) – from the peculiarities of the local market to the all-too-common internal security vulnerabilities. We will then reveal how cutting-edge employee monitoring software offers practical solutions, helping you prevent data leaks, track work time accurately, and build a more secure and productive future for your business.

The foundation of North Carolina's economy is its small and medium-sized businesses - 99.6% of all businesses in the state are SMBs. They employ 45.3% of all state employees, or 1.7 million people. Among the main business sectors in North Carolina are:

1. Healthcare: large hospitals and specialized clinics handle a lot of sensitive patients' data, which makes them a constant target for data leakages.

2. Professional, scientific, and technical services, including legal firms, consulting agencies, and tech startups, handle vast amounts of confidential client information and intellectual property.

3. Manufacturing: manufacturing businesses are particularly vulnerable to industrial espionage and theft of designs or intellectual property.

4. Financial services, including banking, investment, and insurance, are prime targets for financial fraud and data breaches.

The continuing shift towards remote and hybrid work models makes protecting confidential data and maintaining productivity even more complex. North Carolina ranked 11th among states and the District of Columbia in remote work in 2023, with 16.1% of its workforce primarily working from home. Major metro areas like Raleigh-Cary (24.5% remote workers) and Charlotte-Concord-Gastonia (21.5% remote workers) are particular hubs for this trend. Remote work offers undoubted flexibility and cost savings; however, it also expands the business's digital perimeter and makes it more vulnerable to security breaches.

Security dangers can take various forms but can be roughly divided into two main categories: employee-driven and external.

Employee-driven data leakages can be intentional or accidental and cause as many as 88% of all data breaches. Accidental data leaks happen due to human carelessness or failure to follow security protocols. For example, employees may send important data to the wrong recipient by mistake, leave their work devices unsecured, or fall victim to social engineering scams.

Intentional data theft is a rarer occasion but it has dire consequences. Disgruntled employees, those seeking personal gain, or individuals recruited by competitors might deliberately exfiltrate customer lists, trade secrets, financial records, or other proprietary data.

Finally, employees may gain unauthorized access to data or systems they are not supposed to access. This can lead to data misuse or create opportunities for further breaches.

Beyond employee-driven data leakages, there are also external threats. For instance, phishing attacks remain the top reported crime in North Carolina, often targeting employees to gain access to credentials or systems. Ransomware is also a significant threat. One click on the wrong link or opening an infected attachment - and the organization is locked out of critical systems and crippled. Finally, there are business email compromise scams. They are sophisticated social engineering schemes when the scammer often impersonates an executive, a company partner, or a trusted vendor and tricks an employee into making fraudulent payments or sharing sensitive information.

Security threats are only a part of the problem for North Carolina SMBs. Businesses have to deal with productivity issues that may increase in the remote work environment. There is inaccurate timekeeping or even time theft when employees exaggerate work hours or do personal things during their paid work time. Excessive non-work-related activity and unauthorized software installations not only undermine productivity but also can cause a security breach. The employee may accidentally expose the company to malicious websites, infect the device with malware, or violate licensing agreements.

In 2023, North Carolina businesses and individuals reported a staggering $234 million in financial losses due to cybercrime, making the state 13th in the nation for total losses, with 12,282 complaints filed. These numbers prove that companies must take proactive measures to protect sensitive data from internal and external threats.

Cybersecurity and productivity are complex problems that require a thoughtful approach to their solution. One tool that will certainly help both problems is employee monitoring software, in particular, its two types: Data Loss Prevention (DLP) and activity monitoring.

Data Loss Prevention (DLP) Software

At its core, DLP software is designed to prevent sensitive data from leaving your organization's control, whether accidentally or intentionally. For North Carolina SMBs handling customer information, intellectual property, or financial data, DLP is an essential layer of defense.

DLP software can:

1. Track how files are transferred and block unauthorized copying to USB drives, cloud storage, messaging apps, or external hard drives.
2. Scan outgoing emails, web uploads, documents, and others for sensitive information, such as Personally Identifiable Information (PII), Protected Health Information (PHI), or Payment Card Industry (PCI) data. If this information is detected, the software can send an alert or block the process.
3. Prevent employees from taking screenshots or recording screens.
4. Establish a baseline of normal employee behavior and identify deviations that might indicate a data theft attempt or policy violation.
5. Extract and analyze text from images and screenshots, ensuring that sensitive data isn't leaked through non-textual means.

One of the main benefits of DLP is the opportunity to prevent data leaks before they occur and, therefore, minimize financial and reputational damage. Besides, DLP helps meet regulatory requirements related to data protection (e.g., HIPAA for healthcare, Gramm-Leach-Bliley Act for financial services).

Activity Monitoring Software

While DLP software focuses mainly on tracking sensitive information and employees accessing this data, activity monitoring software covers the broader scope of employee behavior. Therefore, it can be used not only for security but also for tracking productivity and work time.

Key features for security and productivity:

1. Tracking visited websites and used applications during the workday.
2. Capturing the start and the end of the workday, identifying idle and active time, and actual work hours.
3. Monitoring email and communications on company-owned devices.
4. Generating detailed reports on employee activity, identifying trends, peak productivity times, and areas for improvement.
5. Taking periodic screenshots or recording the screen.
6. Face Recognition to control who accesses the device.
7. Advanced employee monitoring solutions can also record video and sound from the webcam, capture calls, manage tasks, see how much time is spent on them, and much more.

Employee monitoring software is perfect for improving productivity. It helps identify time-wasting activities and focus on the work tasks at hand. Besides, it ensures accurate billing and payroll based on the actual work hours.

Activity monitoring software can complement some DLP functionality. Although it usually does not track file operations, its extensive logs of employee activity can provide the necessary evidence in cases of internal investigations.

Finally, activity monitoring fosters a culture where employees are aware of their work output and responsible for their time.

Constructive feedback is a two-way street. When you have given your evaluation, give the employee a word to explain their vision of the situation. You may prompt them by asking open questions, such as "What are your thoughts on your results?" or "What do you think might have contributed to that dip in performance?" They will encourage the employee to reflect on their work and share problems they may be experiencing. Often, they'll have valuable context you might not be aware of, or even suggest solutions themselves. Listen actively and take notes of their insights.

Regardless of what type of monitoring software a business chooses, implementing it will require more than simply rolling it out on office computers. Understanding the legal landscape - federal and state-specific privacy and labor regulations - is paramount before any monitoring can be used.

The federal law Electronic Communications Privacy Act (ECPA) generally permits employers to monitor communications on company-owned systems for legitimate business reasons. Individual states may add more requirements, but North Carolina does not impose overly stringent unique mandates. However, it does not mean a business should not carefully consider them to ensure compliance.

First, explicit employee consent for monitoring, although not always explicitly required, is still highly advisable, especially when monitoring communications. This is typically done through a clear, comprehensive employee monitoring policy signed upon hiring or when new monitoring measures are introduced.

Secret monitoring may be illegal for some types of monitoring. North Carolina's cyberstalking law, for example, prohibits GPS tracking without consent, though exceptions exist for fleet vehicles. Even if a certain type of monitoring is not explicitly illegal to use secretly, the lack of transparency can severely damage employee morale and lead to distrust or legal disputes based on "reasonable expectation of privacy."

Employers in North Carolina should never monitor employees in private areas such as restrooms, changing rooms, or break rooms, as this is almost universally prohibited and considered a severe invasion of privacy. Similarly, monitoring an employee's personal devices (e.g., their private phone or laptop used for occasional work tasks) or tracking their location outside of work hours without explicit, specific consent is likely to violate privacy expectations and could lead to legal repercussions. However, the employee has no reasonable expectations of privacy while using company-owned devices, networks, or email accounts for work-related purposes.

Apart from legal requirements, businesses should consider the ethical side of implementing employee monitoring. This is, by itself, a vast topic, which we have explored in detail in this article.

The unique nature of North Carolina's economy, the growing trend for remote and hybrid work, and, as a result, increased security risks and the demand for productivity necessitate a proactive approach. This approach is employee monitoring software.

When implemented thoughtfully, employee tracking becomes more than just a surveillance tool. It transforms into a strategic asset, empowering North Carolina businesses to build a more secure, productive, and ultimately, more successful future.