Five data leak nightmares

When Home Depot lost a laptop containing personal information on 10000 employees, it was just the latest in a string of high-profile data-leak incidents.

Nightmare five: Downsizing disasters - Data theft increases during mergers, layoffs and reorganizations

When a company announces a merger - or worse, downsizing - employee loyalty can be undermined. "The amount of data offloading during these events is huge," says Robert Yonowitz, a partner with Fisher & Phillips, a law firm that specializes in labor and employment law.

Often, organizations plan poorly for these events, worsening the problem. For example, if a company announces a 10% staff reduction but doesn't say who is safe and who isn't, then the risk of data theft goes up significantly.

If your company isn't expecting to downsize or reorganize anytime soon, don't think that you can rest easy. The same dynamics are in place, albeit on a much smaller scale, any time key employees change jobs. When an employee leaves the company, that person has usually been planning for a month or two prior, which is when most data theft occurs.

According to Yonowitz, 90% of the data loss cases he sees involve customer lists. For instance, when marketing or sales representatives move to competitors, they often promise to bring business with them.

Business relationships fall into a nebulous area. Legally, the company owns the business relationship and the key information the employee gleaned while on the job, but the employee certainly has the right to maintain and update the personal relationships that underpin those larger business relationships.

It's OK, then, for an employee to announce a job change to key contacts. That person could very well be violating a non-compete clause, though, if the announcement is more like a solicitation.

The instances that companies lose sleep over, though, usually go well beyond relationship gray areas. "These cases aren't just about people taking names and addresses, but what I call the 'customer playbook,'" Yonowitz says. "These are things like buying habits, contract terms, expiration dates on those contracts, and the status of potential deals that haven't yet closed."

Time is of the essence in these cases. Yonowitz estimates that 90% of the damage is done within two weeks after the employee's departure. If you don't catch the data loss quickly and respond right away, the damage will already be done.

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Jeff Vance

Network World
Show Comments

Cool Tech

SanDisk MicroSDXC™ for Nintendo® Switch™

Learn more >

Breitling Superocean Heritage Chronographe 44

Learn more >

Toys for Boys

Family Friendly

Panasonic 4K UHD Blu-Ray Player and Full HD Recorder with Netflix - UBT1GL-K

Learn more >

Stocking Stuffer

Razer DeathAdder Expert Ergonomic Gaming Mouse

Learn more >

Christmas Gift Guide

Click for more ›

Most Popular Reviews

Latest Articles


PCW Evaluation Team

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Walid Mikhael

Brother QL-820NWB Professional Label Printer

It’s easy to set up, it’s compact and quiet when printing and to top if off, the print quality is excellent. This is hands down the best printer I’ve used for printing labels.

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

George Khoury

Sharp PN-40TC1 Huddle Board

The biggest perks for me would be that it comes with easy to use and comprehensive programs that make the collaboration process a whole lot more intuitive and organic

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?