Workplace Technology

With Wearable Tech, Trust Is Paramount

The degree to which companies can effectively collect data on their employees hinges upon trust and transparency.
By: | July 27, 2017 • 6 min read

Yielding to a moment of childlike joie de vivre, a construction worker on a school renovation site slid about 16 feet down the stairway bannister.

Alerted by the array of sensors in the worker’s wearable tracking device and fearing a fall, the safety supervisor sped to the location the device’s real-time interior location services indicated. He found the worker calmly proceeding with his work, according to an anecdote related by Peter Schermerhorn, chief operating officer for Triax Technologies, which makes wearable technologies for construction site safety.


Rather than broken bones and a hefty workers’ compensation claim, the worker’s only injury was to his pride as he submitted to a gentle reminder of the company’s safety culture and some less-gentle teasing from his colleagues.

The story, however, could just as easily have had a darker ending, said public interest attorney Harvey Rosenfield, founder, Consumer Watchdog. The worker could have been fired for his momentary, presumably private lapse.

Alternatively, the wearable device could have captured biometric data suggesting a congenital heart defect, leading to his dismissal or making him ineligible for health insurance in the future due to a pre-existing condition.

The tension between the benign, putative use of collected data and its potential for misuse could redefine the relationship between employers, employees and insurers, said Edward McNicholas, a partner at Sidley Austin LLP. McNicholas counsels companies on data privacy.

The degree to which companies can successfully collect data pivots on trust. Companies must be transparent about what data they’re collecting and how they will use it, said Bill Spiers, vice president, risk control consulting practice leader, Lockton Companies. Spiers says pre-loss data technologies are “exciting tools to prevent injury” but he sees the potential for litigation if they’re misused.

Bill Spiers, vice president, risk control consulting practice leader, Lockton Companies

“If you get buy-in from workers, compliance isn’t a problem. When you bait and switch, that gets to be a problem in the workplace. Responsible companies embrace the fact that their employees are their most precious asset,” Spiers said. “They want employees to go home as they left.”

Successful workplace surveillance programs depend on “a unified, coherent, non-hypocritical approach,” said Lee Tien, senior staff attorney, Electronic Frontier Foundation.

Spiers sees “only a bright future” when companies keep trust with their employees. But when they break it, he said, not only will employees push back, but the data collected may not even be very useful in workers’ compensation cases. “There would be sensitivities because workers’ comp claims are regulated and adjudicated.”

Responsible use will also foster more product development and adoption of tracking technologies, said McNicholas. “If the employer explains what data is to be collected and how it is to be used, and employees trust that it’s used as described, more of these technologies will be adopted.”

Prevention and Recovery Benefits

Wearable tracking technologies have applications both in wellness and injury prevention and treatment, and many are time-tested and accepted, such as the personal dosimeter radiation technicians attach to their scrubs to monitor exposures and the GPS firefighters wear in case they’re trapped in a blaze.


“The purpose of the technology is to drive a safer environment, to look at how workers do their job,” said Zack Craft, vice president, rehab technology and complex care, One Call.

On the rehabilitation side, he said, a tracker could collect data on stress to an injured worker’s shoulders as he propels his wheelchair. This could lead to a decision to give him a scooter, hastening his recovery.

“If you get buy-in from workers, compliance isn’t a problem. When you bait and switch, that gets to be a problem in the workplace.” — Bill Spiers, vice president, risk control consulting practice leader, Lockton Companies

Wearable technologies are a great tool for ergonomists to engineer risk out of tasks and to train workers, said Spiers.

Through electric leads attached to large muscle groups, ergonomists can measure strain and muscle demand during high-risk tasks.

“They get the data, compare it with videotapes of the job, and make strategic decisions about what part of the job is problematic.” A manufacturer of foam products, for example, conducted a pilot study with DorsaVi, which manufactures technology that measures human movement.

The company uses the information to decide where to automate and how to train employees, Spiers said. “It’s great information to prevent injuries.”

Ulterior Motives

Telemetrics, used in a similar fashion to wearables, have been successful in changing truck driver behavior, Spiers said. The devices expose swerves, speeding and quick stops. “[Drivers] know they’re being monitored. They comply if they want to drive with these firms.”

Technologies that enhance security and safety, and are not used for surveillance, are helpful, said McNicholas. Or when surveillance is part of safety — as with the telemetrics for truck drivers — “those will take off.”

Edward McNicholas, partner, Sidley Austin LLP

But those that are advanced for one purpose and used for another introduce significant privacy challenges, said Tien.

For example, a GPS may track an employee’s off-duty time at a bar or liquor store. “The employer may conclude that the worker has an alcohol problem and take disciplinary action,” Tien said.

Or a device may capture conversations not intended for management. “It doesn’t take a rocket scientist to figure out how a recording could be used against the worker.”

Companies that don’t self-limit what they do with the often-sensitive data collected by wearables, that don’t care about informed consent, or that pretend they’re collecting data for workers’ own good are asking for trouble, he said.

“If that’s the company’s line, that’s a dangerous way to proceed.”

Rosenfield takes an unequivocal position on protecting consumer and worker privacy.

“Until workers and consumers have a panoply of statutory protections against misuse of data or use of data by insurance carriers to deny claims or coverage or otherwise punish people,” he said, “I don’t think these devices or applications should be permitted.”


The greater the intrusion into workers’ privacy, said Jason Geller, partner, Fisher & Phillips LLP, “the stronger the justification for intrusion the employer must advance.”

Intrusions that save lives and prevent injuries on a worksite would likely pass a court’s test for “legitimate justification,” he said. Intrusions imposed for the employer’s benefit, such as productivity tracking, would be subject to a higher standard.

To mitigate litigation risks, many employers minimize expectations of privacy, Geller said, by stating upfront that they will collect and use data from the wearable technologies, just as they warn employees not to store personal information on company computers. A written policy is wise, he said.

Biometric and health information, which is by its nature private, can create HIPAA-related risk for employers, Geller said. “Employers should decide at the outset what data to collect and for what business purpose.”

Do the analysis on the front end, he advised, and “then only collect bare minimum necessary to advance the business justification.” &

Susannah Levine writes about health care, education and technology. She can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

Risk Report: Marine

Crewless Ships Raise Questions

Is a remote operator legally a master? New technology confounds old terms.
By: | March 5, 2018 • 6 min read

For many developers, the accelerating development of remote-controlled and autonomous ships represents what could be the dawn of a new era. For underwriters and brokers, however, such vessels could represent the end of thousands of years of maritime law and risk management.

Rod Johnson, director of marine risk management, RSA Global Risk

While crewless vessels have yet to breach commercial service, there are active testing programs. Most brokers and underwriters expect small-scale commercial operations to be feasible in a few years, but that outlook only considers technical feasibility. How such operations will be insured remains unclear.

“I have been giving this a great deal of thought, this sits on my desk every day,” said Rod Johnson, director of marine risk management, RSA Global Risk, a major UK underwriter. Johnson sits on the loss-prevention committee of the International Union of Maritime Insurers.

“The agreed uncertainty that underpins marine insurance is falling away, but we are pretending that it isn’t. The contractual framework is being made less relevant all the time.”

Defining Autonomous Vessels

Two types of crewless vessels are being contemplated. First up is a drone with no one on board but actively controlled by a human at a remote command post on land or even on another vessel.

While some debate whether the controllers of drone aircrafts are pilots or operators, the very real question yet to be addressed is if a vessel controller is legally a “master” under maritime law.


The other type of crewless vessel would be completely autonomous, with the onboard systems making decisions about navigation, weather and operations.

Advocates tout the benefits of larger cargo capacity without crew spaces, including radically different hull designs without decks people can walk on. Doubters note a crew can fix things at sea while a ship cannot.

Rolls-Royce is one of the major proponents and designers. The company tested a remote-controlled tug in Copenhagen in June 2017.

“We think the initial early adopters will be vessels operating on fixed routes within coastal waters under the jurisdiction of flag states,” the company said.

“We expect to see the first autonomous vessel in commercial operation by the end of the decade. Further out, around 2025, we expect autonomous vessels to operate further from shore — perhaps coastal cargo ships. For ocean-going vessels to be autonomous, it will require a change in international regulations, so this will take longer.”

Once autonomous ships are a reality, “the entire current legal framework for maritime law and insurance is done,” said Johnson. “The master has not been replaced; he is just gone. Commodity ships (bulk carriers) would be most amenable to that technology. I’m not overly bothered by fully automated ships, but I am extremely bothered by heavily automated ones.”

He cited two risks specifically: hacking and fire.

“We expect to see the first autonomous vessel in commercial operation by the end of the decade. Further out, around 2025, we expect autonomous vessels to operate further from shore — perhaps coastal cargo ships. For ocean-going vessels to be autonomous, it will require a change in international regulations, so this will take longer.” — Rolls-Royce Holdings study

Andrew Kinsey, senior marine risk consultant, Allianz Global Corporate & Specialty, asked an even more existential question: “From an insurance standpoint, are we even still talking about a vessel as it is under law? Starting with the legal framework, the duty of a flag state is ‘manning of ships.’ What about the duty to render assistance? There cannot be insurance coverage of an illegal contract.”

Several sources noted that the technological development of crewless ships, while impressive, seems to be a solution in search of a problem. There is no known need in the market; no shippers, operators, owners or mariners advocate that crewless ships will solve their problems.

Kinsey takes umbrage at the suggestion that promotional material on crewless vessels cherry picks his company’s data, which found 75 percent to 90 percent of marine losses are caused by human error.


“Removing the humans from the vessels does not eliminate the human error. It just moves the human error from the helm to the coder. The reports on development by the companies with a vested interest [in crewless vessels] tend to read a lot like advertisements. The pressure for this is not coming from the end users.”

To be sure, Kinsey is a proponent of automation and technology when applied prudently, believing automation can make strides in areas of the supply chains. Much of the talk about automation is trying to bury the serious shortage of qualified crews. It also overshadows the very real potential for blockchain technology to overhaul the backend of marine insurance.

As a marine surveyor, Kinsey said he can go down to the wharf, inspect cranes, vessels and securements, and supervise loading and unloading — but he can’t inspect computer code or cyber security.

New Times, New Risks

In all fairness, insurance language has changed since the 17th century, especially as technology races ahead in the 21st.

“If you read any hull form, it’s practically Shakespearean,” said Stephen J. Harris, senior vice president of marine protection UK, Marsh. “The language is no longer fit for purpose. Our concern specifically to this topic is that the antiquated language talks about crew being on board. If they are not on board, do they still legally count as crew?”

Harris further questioned, “Under hull insurance, and provided that the ship owner has acted diligently, cover is extended to negligence of the master or crew. Does that still apply if the captain is not on board but sitting at a desk in an office?”

Andrew Kinsey, senior marine risk consultant, Allianz Global Corporate & Specialty

Several sources noted that a few international organizations, notably the Comite Maritime International and the International Maritime Organization, “have been very active in asking the legal profession around the world about their thoughts. The interpretations vary greatly. The legal complications of crewless vessels are actually more complicated than the technology.”

For example, if the operational, insurance and regulatory entities in two countries agree on the voyage of a crewless vessel across the ocean, a mishap or storm could drive the vessel into port or on shore of a third country that does not recognize those agreements.

“What worries insurers is legal uncertainty,” said Harris.

“If an operator did everything fine but a system went down, then most likely the designer would be responsible. But even if a designer explicitly accepted responsibility, what matters would be the flag state’s law in international waters and the local state’s law in territorial waters.


“We see the way ahead for this technology as local and short-sea operations. The law has to catch up with the technology, and it is showing no signs of doing so.”

Thomas M. Boudreau, head of specialty insurance, The Hartford, suggested that remote ferry operations could be the most appropriate use: “They travel fixed routes, all within one country’s waters.”

There could also be environmental and operational benefits from using battery power rather than conventional fuels.

“In terms of underwriting, the burden would shift to the manufacturer and designer of the operating systems,” Boudreau added.

It may just be, he suggested, that crewless ships are merely replacing old risks with new ones. Crews can deal with small repairs, fires or leaks at sea, but small conditions such as those can go unchecked and endanger the whole ship and cargo.

“The cyber risk is also concerning. The vessel may be safe from physical piracy, but what about hacking?” &

Gregory DL Morris is an independent business journalist based in New York with 25 years’ experience in industry, energy, finance and transportation. He can be reached at [email protected]