Though this subject concerns the use of hidden cameras, it belongs in the business services section more than in the covert camera section. The theft of time, products, and services accounts for huge losses for businesses. The Association of National Fraud Examiners reported in 2004 that 6 percent of U.S. businesses' annual revenue is lost because of fraud. This translates to a loss of $660 billion per year when applied to the gross national product. In light of these numbers, businesses must protect themselves.

How Businesses Protect Themselves

Because of the tremendous loss of revenue, businesses are forced to protect assets. One way to do this is the installation of covert cameras. Some owners never inform their employees of the existence of these cameras. If that's her choice, she's within her rights to record video if she doesn't record audio with it.

Some owners choose to inform employees that there may be cameras watching and listening to them at any time. In this case, it's best to have the employee sign a release confirming that he's been informed of possible surveillance (using “possible” surveillance gives an owner the option of leasing cameras periodically rather than purchasing them).

By disclosing the existence of her cameras, the employer can record audio. Because the cameras are hidden — sometimes remarkably so — the employee will never be sure if he's being monitored, nor will he know the location of monitoring devices. With this strategy, one purpose for installing covert cameras can still be achieved — the employee will refrain from theft of products or services, or his theft will be disclosed. This should also increase employee productivity and quality of client or customer service.

By informing clients that they may be monitored and having them sign that they've been informed, all three problems that plague businesses most — theft of time, products, and services — can be addressed, along with the added bonus of improved customer service.

In regard to telephone monitoring, should the employer want to monitor every employee's interaction with customers as a matter of policy and for training, federal law allows her to do so. Yet, the moment the conversation changes from business to personal, monitoring must stop. This is a gray area, because business owners who monitor don't do so themselves, and automated systems cannot determine which part of a conversation is about business and which is personal. However, rulings have been made that if the owner informs the employee that monitoring will occur, or is a possibility, the recording is legal.