Downsizing & Data Loss - The Alarming Connection
Time 3 Minute Read

In an effort to ride out the current economic storm, many businesses find themselves downsizing, conducting mass layoffs, and even declaring Chapter 11 bankruptcy in an effort to survive.  These tough decisions inevitably lead to disgruntled former employees, whose ethics tend to take a backseat when it comes to “getting even” with their employers. 

Most modern companies are familiar with the need for day-to-day data security measures to protect confidential information.  During the chaos associated with conducting a mass layoff or downsizing, however, protecting confidential information often becomes less of a priority at a time when companies are most vulnerable.

Particularly disturbing is a recent study finding that as many as 58% of former employees have stolen data from their former employers, and 68% of those employees planned to use that information at their new jobs!  With the ease of which current technology allows for the instantaneous transmittal of electronic information, stealing company data is far from a hard or complicated endeavor, and can be as simple as a click of a mouse.  Most commonly, former employees take company information by downloading it to CDs, DVDs, and flash drives, or simply attaching the information to an email. 

The good news is that data loss during downsizing can be prevented with a few simple measures:

  • Require all new employees to sign a confidentiality and non-disclosure agreement.
  • Conduct ethics training to ensure employees understand the magnitude of taking proprietary or confidential information from the company.
  • Provide company owned storage devices to employees, and prohibit the use of personal storage devices (such as a USB drive).
  • Backup, Backup, Backup.  If an employee leaves with information that is not located anywhere else, it will be gone forever.
  • Interview departing employees to review signed confidentiality and non-disclosure agreements and obtain another signed acknowledgment.
  • During the exit interview, obtain a list of all of the confidential information, files and data that the departing employee may have had access to.
  • After the exit interview, conduct a review or audit of the departing employee’s paper files and electronic documents to ensure nothing is missing.
  • Monitor the departing employee’s conduct after the exit interview, including the employee’s computer activity, to look for any abnormal downloading of company files.
  • Prepare a list of all company property given to the employee and returned upon termination, including company laptops, blackberries, and any storage devices.
  • Immediately disable a departing employee’s access to company networks, computers, entry points and parking lots.


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