Wearable Technology Impact on Business and HR

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May 24, 2018


Wearable Tech

Wearable technologies like smartwatches and digital fitness trackers are wildly popular among American consumers. A 2016 survey of over 4,000 adults by Rock Health revealed that "nearly one out of every four individuals1" owns a wearable device, up from about one in ten in 2015.

The trend of wearable technology adoption is predicted to continue, with i-scoop reporting that IDTechEx research forecasts "accelerated growth (of wearables) with a yearly growth of 23 percent through to over $100 billion by 20232," leading to an increase in the use of wearables at work.

How wearable technology is shaping modern business practices

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Wearable technologies present both opportunities and challenges to businesses across a broad spectrum. For example, body-worn cameras (BWCs) are quickly becoming the norm among law enforcement agencies, with 95 percent of police departments in the U.S. reporting that they either currently use, or plan to implement a BWC program.

While BWCs are unlikely to be adopted in most workplaces, other wearable devices like smartwatches and fitness trackers are becoming common, with adults aged 25 to 44 leading the trend4 towards wearable technology used in business. In 2015, BP America distributed 24,5005 Fitbit fitness trackers to employees and dependent spouses as part of a plan to incentivize physical fitness and reduce health insurance premiums, and a number of other large companies have implemented similar programs since then including IBM, Time Warner, and Bank of America.6

Employee movements and sleep habits — privacy vs. an employers' right to know

Wearable technology can track and record an incredible amount of personal health information ranging from average heart rate to amount of time the wearer spends sleeping every night. While this information is useful from a health monitoring perspective, questions exist around whether or not an employer has the right to access this data, especially when it involves time spent 'off the clock'.

So far, adoption of wearable technologies outside of the workplace seems to be implemented on a voluntary basis. The most notable example of this is at Three Square Market, a Wisconsin-based company that is among the first in America to microchip its employees. This was done on a voluntary basis, with the company reporting that 50 out of 80 eligible employees signed up for the program.

Who owns data collected from wearable devices?

Another notable issue related to the use of wearable devices is data ownership, particularly in cases where the business supplies the technology.

There are also lingering questions related to business-owned wearable technologies and the Health Insurance Portability and Accountability Act (HIPAA). While the actual technology device manufacturers are not bound by HIPAA laws, in most cases, employers are. The other piece of federal legislation that could impact data collection and ownership it the Stored Communications Act (SCA), however, its current form the SCA does not cover personal health data from wearable devices.

According to Carol Michel of Weinberg Wheeler Hudgins Gunn & Dial LLC, "data recorded from wearable devices seems to fall into noman's land with regard to the HIPAA and the SCA8".

Wearable devices = high-tech witnesses

Another interesting impact of the widespread use of fitness trackers and smartwatches has been the use of data collected by these devices in both civil and criminal proceedings.

In November 2014 a team of lawyers in Calgary, Canada was successful in its bid to include data from a clients' activity tracker as evidence in a personal injury lawsuit. The data collected by a wearable Fitbit fitness tracker served as proof of the negative effects an auto accident had had on the litigants' physical activity levels, thereby impacting the claimants' quality of life.

Since that ground-breaking case wearable technology has been used to both confirm and disprove a number of criminal charges including a false rape report by a disgruntled employee in Lancaster, Pennsylvania. In this case, investigators downloaded data from the alleged victims' fitness tracker and discovered her claims were unfounded based on the activity logged by her wearable device.

Federal Fair Labor Standards Act (FLSA) issues related to wearable technologies

The FLSA requires that all eligible employees (including most hourly employees) be compensated for all the hours they spend "performing work that is for the benefit of the employer", and tracking time worked is now easier than ever with wearable technologies.

Lawyers at Bellas & Wachowski, a firm in Chicago, advise employers "to review their policies and strictly prohibit nonexempt employees from checking or responding to email or performing other work-related tasks remotely outside of normal working hours or without express authorization" to guard against claims of unpaid wages.

Expect to see the issue of wearable technology included in bargaining sessions within unionized workplaces. Notably, the NBA Players Association negotiated the creation of a joint advisory committee in 2016, guaranteeing professional basketball players a say in how wearable technology can be used on and off the court.

1. https://rockhealth.com/reports/digital-health-consumer-adoption-2016/
2. https://www.i-scoop.eu/wearables-market-outlook-2020-drivers-new-markets/
3. https://assets.bwbx.io/documents/users/iqjWHBFdfxIU/rvnT.EAJQwK4/v0
4. https://www.hrexchangenetwork.com/hr-technology/articles/the-wearable-tech-trend-and-its-impact-on
5. http://www.bbc.com/news/business-33261116
6. https://www.fastcompany.com/3058462/how-fitbit-became-the-next-big-thing-in-corporate-wellness
7. http://www.lorman.com/resources/wearable-fitness-devices-a-new-frontier-16774
8. http://www.abc27.com/news/police-womans-fitness-watch-disproved-rape-report/1107961245


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