Protection Has a Price

Continuing layoffs mean business is booming for firms that provide workplace security, as companies add more guards because they fear that the firings could result in sabotage or violent behavior.

Also benefiting the industry is an increase in the monitoring of employee e-mail and Internet use. Companies often contract out that work.

Yet many--including some security firms--say the spying and guards can go too far, destroying the morale of remaining workers and eventually hurting the company’s bottom line.

“This is the busiest I’ve seen it since 1979,” said Mike Luddy, chief executive of Mountain View, Calif.-based International Security Services Inc., who said his firm is receiving as many as four requests for new business each day. “A lot of it is centering on company layoffs and the fear of retribution from former employees. And there is a greater sense now that employers are required to have a safe and secure workplace.”

Luddy, whose firm provides traditional security services and computer network protection, said more companies today understand that some of the greatest threats come not from outside hacker attacks but from current and former employees.

Interphase International, a Silicon Valley private investigation/security firm composed of ex-law enforcement officers, has picked up 20 new clients since January, said Chief Executive Gary Williams. Most of the new customers are high-tech companies laying off employees, Williams said.

And at Internet Security Systems Inc. in Atlanta, which specializes in computer network protection and Internet filtering, the client list has grown to 10,000 today from 6,000 at the end of 2000, according to Alan Schoenberg, the company’s corporate affairs manager.

But while security firms grow, employees suffer, according to workers’ rights advocates.

“We believe that companies are unnecessarily abusing people on their last days of work, treating them as potential saboteurs and even as potential murderers,” said Paul Tobias, chairman of the nonprofit group Workplace Fairness in San Francisco. “Most of this is totally unjustified. A good severance package works better, along with giving employees plenty of notice, than spending a lot of money on more security.”

Without security, however, employers could end up being liable for sexual harassment if employees are viewing pornography on the Internet or if violence occurs on their property.

“Insurers are demanding better security,” said Ray O’Hara, senior vice president for the Western region for Pinkertons, a security firm that once provided protection for President Abraham Lincoln. “There’s been an increase in negligent-hiring lawsuits after workplace violence incidents. Good security is prudent and ongoing.”

O’Hara, however, said that sometimes companies haven’t a clue about how to lay off people.

“[One client] said that they were just going to hand out letters to their employees. ‘You will get to stay. You won’t,’ ” O’Hara said. “We told them they would have fistfights in the parking lot if they did it that way. You have to allow these people to maintain their sense of dignity, not lock them out at 4:30 p.m. on a Friday.”

In addition to hurting morale, bad firings can destroy the loyalty of employees who aren’t laid off.

“Look, it wasn’t a surprise that we were going to lose people,” said Jim, a survivor of two waves of layoffs at his Silicon Valley company who didn’t want his last name used for fear that he might lose his job before he finds a new one.

“Everyone knew how badly things were going. But what no one expected was the goon squad of security types who were trying to look like they belonged in the building. You found out you were gone when you couldn’t sign on. Your password didn’t work. So, we stood there and tried to sign on to see who was staying and who was gone.”

Some experts say that companies don’t really have a choice, especially when sensitive information or computer networks are involved.

“You are forced into trying to protect these systems,” said David Lewin, the Neal Jacoby professor of management at UCLA’s Anderson School of business. “Property has shifted to databases and other forms of electronic information.”

Companies will have to deal with the aftermath of such actions, though.

“This sort of thing can create a feeling of intimidation and insecurity,” said Jill Stein, a lecturer and academic administrator in UCLA’s sociology department. “In general, it could cause more animosity than not. It can create a bad atmosphere for the employees who remain. They [feel they] are not really trusted, they are not really part of the company and they are expendable in these very heavy-handed kinds of ways.”

Still, not all workers object to tight security.

After being locked in a building with an intruder at a previous job, Jenifer Singleton of Los Angeles appreciates workplace safety.

So, when Singleton’s current boss, Dan Rubin, took a long, hard look at the vulnerabilities of his investment group office, Singleton supported all of the changes he had in mind.

Rubin put a former hacker on the payroll to patrol his computer networks for unauthorized use and for electronic intrusions. He had the company’s employee manual rewritten, requiring that his workers sign a release acknowledging that they had been told that their e-mail and Internet use would be monitored.

“I was all for it because I feel secure in this office,” said Singleton, the firm’s chief executive assistant and client manager.

Rubin, chief executive of Rubin Investment Group, said he is pleased with most of his decisions, given the fact that he is in a high-traffic area on the ground floor of Fox Plaza in Century City.

The one problem, Rubin said, was the high-tech face recognition system at the office entrance.

The system worked well for his 20 employees, but its television monitors fixed an unrelenting red circle on every unsuspecting delivery person, maintenance worker, visitor and client who showed up, shutting down the entrance with magnetic locks.

“It was even stopping the Fed Ex guy,” said the 29-year-old Rubin. “You don’t realize how many guests you get each day. The CEO of a company comes to the door and he sees a red circle on his face in the monitor and he can’t get inside. Eventually, we just unplugged it.”

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