You run a small business and suspect that one of your employees is swiping cash from the register. Or you manage the local branch of a national bank and believe that one of your tellers is misappropriating funds. You have strong suspicions about the identity of culprit, but no hard evidence to back up your hunch. Is it a good idea to administer a polygraph to all of the employees who work in the area where funds have gone missing?
The federal Employee Polygraph Protect Act, codified at 29 U.S.C. § 2001 et seq., (the “EPPA”), prohibits virtually all employers from disciplining employees either on the basis of the results of a polygraph test or refusing to submit to such a test, with a few limited exceptions. And, if an employer violates the EPPA, he or she may be subject to civil penalties of up to $10,000 and may also face civil liability in a private suit by the employee.
One of those exceptions is for an ongoing investigation into suspected theft, misappropriation or embezzlement. “But that’s exactly what I want to use it for!” you say. Not so fast.
While the EPPA ostensibly allows for such use, there are many restrictions and potential pitfalls for the unwary. Most importantly, the “investigation exception” applies only to the particular employee suspected of theft or misappropriation, who must have had access to the property in question. In addition, a polygraph may be administered lawfully only if:
the employer executes a statement, provided to the examinee before the test, that—
(A) sets forth with particularity the specific incident or activity being investigated and the basis for testing particular employees,
(B) is signed by a person (other than a polygraph examiner) authorized to legally bind the employer,
(C) is retained by the employer for at least 3 years, and
(D) contains at a minimum—
(i) an identification of the specific economic loss or injury to the business of the employer,
(ii) a statement indicating that the employee had access to the property that is the subject of the investigation, and
(iii) a statement describing the basis of the employer’s reasonable suspicion that the employee was involved in the incident or activity under investigation.
29 U.S.C. § 2006 (d). If the employer does not have a “reasonable suspicion” and additional supporting evidence of theft or embezzlement (which means more than the evidence supplied by the polygraph test), the employer can still be subject to civil liability or penalties for administering the polygraph test.
As if this were not enough, the EPPA also requires that the employer provide the employee who is being subjected to the test with a litany of rights throughout all phases of the testing, a complete listing of which can be found at 29 U.S.C. § 2007(b). The rights that must be afforded include (but are not limited to): (1) allowing the examinee to terminate the test at any time; (2) not asking questions about his or her beliefs concerning race, politics or religion; (3) providing the examinee with advance written notice of the date, place and time of the examination, the questions to be asked and of his or her rights under the EPPA.
Given the complexity of the above-stated restrictions and the potential exposure to liability associated with administering a polygraph test and violating any of such restrictions, it is generally advisable for an employer to use alternative methods for investigating suspected dishonest behavior.