Microchipping Employees Creates Lots of Risk and Unanswered Questions

October 3, 2017

A Wisconsin-based technology company, Three Square Market, recently announced a pilot program to implant microchips in its employees. There’s significant risk and uncertainty for employers considering such a program. This article addresses the potential risks of microchipping employees and the many unanswered privacy and health-related questions it raises.

Background

On August 1, 2017, employees at Three Square Market decided whether to have a chip the size of a grain of rice injected between their thumb and index finger. The chips use radio-frequency identification (RFID) to allow employees to pay for food and drinks in the company’s break room, open security doors, and log in to their computers without any special cards or passwords.

The program isn’t mandatory, but as of early August, more than 50 out of the 80 employees at Three Square’s headquarters in River Falls had volunteered to be microchipped. The program is a partnership between Three Square and the Swedish company Biohax International. It is believed to be the first of its kind in the United States, but a similar program was already implemented at Epicenter, a Swedish company. Three Square is covering the $300-per-employee cost of the microchips.

So Many Questions, so Many Risks

Microchipping employees raises a plethora of privacy and health-related concerns. First, where do you draw the line? While an employer may intend to provide some minor conveniences to its employees through microchips, the microchip could also be used to track an employee’s hours or whereabouts in the office at all times. To avoid controversy, an employer considering such a program should adopt a written policy stating that microchips will not be used to track employees inside— or outside—the workplace.

In this day and age, there’s no shortage of news about hacking and data security. Three Square and its Swedish partner maintain that the microchips are safe and aren’t vulnerable to hacking. Further, there has been no evidence of hacking or other security issues with employees at European companies that have already used the technology. Nevertheless, there are many kinds of medical devices that can be hacked.

In 2015, the U.S. Food and Drug Administration (FDA) recommended that hospitals stop using a particular line of drug-infusion devices after a security researcher discovered how easy it would be for a hacker to commandeer the device and overdose a patient. If you’re thinking about adopting a microchip program, you should take all reasonable steps to ensure the data collected is safely stored and have a policy in place to deal with any data breaches that might occur. Another basic question is whether there are any health issues related to installing a microchip in someone’s hand, such as infection or more serious long-term health risks. While there’s no indication that microchips cause any long-term damage, the technology is in its infancy, and very few studies have been done on the subject.

Another issue that will surely arise is who will pay for the removal of the microchip when an employee leaves the company. Many employees will likely balk at paying a significant amount of money to have the device removed. Again, if you’re considering such a program, carefully spell out who will pay for the removal of the chips before implementing the plan.

Bottom Line

Uncertainty creates risk, and there’s no shortage of uncertainty when it comes to microchipping employees. While microchips may provide some convenience for employees logging in to their computers or paying for food at the company cafeteria, the risks of such a program are significant. Before giving employees the option of having a microchip inserted in their bodies, you should carefully consider the potential risks and work with your employment law counsel or HR professionals to craft a clear policy to address the many uncertainties raised by the plan.

This article, slightly modified to note recent updates, was featured in the September 2017 issue of the Wisconsin Employment Law Letter, which is co-edited by Axley Brynelson Attorneys Saul Glazer and Michael Modl and published by BLR®—Business & Legal Resources. Reproduced here with the permission of BLR®—Business & Legal Resources.

For more information about "Microchipping Employees Creates Lots of Risk and Unanswered Questions," contact Justin H. Lessner at jlessner@axley.com or 608.283.6761.