Understanding Data Theft in the Workplace: Laws in the UK

In Short

• Workplace data theft is increasing, particularly in remote and hybrid working environments.

• Different UK laws may apply depending on whether personal data, confidential information or computer systems are misused.

• Prevention is key, with clear rules, access controls and monitoring helping to reduce risk.

Tips for Businesses

Limit access to sensitive information and clearly define what data is confidential. Train staff regularly on data protection and acceptable use, and monitor systems for unusual activity. Pay extra attention when employees leave, as this is a high-risk period. If data theft occurs, act quickly and seek legal advice to minimise damage.

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Table of Contents

• Data Theft in the Modern Workplace 
• Commercially Sensitive Information
• Legal Considerations Around Data Theft
• Understanding Which Laws Apply
• Client Confidentiality and Reputational Harm
• Reducing the Risk of Insider Data Theft
• Key Takeaways
• Frequently Asked Questions

Staff data theft is an increasingly significant issue for businesses. Modern workplaces are vulnerable to information being copied, transferred, or misused quickly and with minimal visibility. The ease with which data can move across devices, networks and systems has reshaped internal risk around workplace data theft, particularly when individuals have access to commercially sensitive or confidential material in their everyday roles. 

While the term ‘data theft’ is commonly used, the legal rules that apply depend on the type of information and whether it was accessed or used without permission. This article explores:

• common reasons for data theft in the workplace;
• examples of legal rules that can apply to workplace data thefts; and
• practical steps to help organisations reduce their exposure to these growing data theft threats. 

Personal Data Breach Notification Factsheet

This factsheet outlines the steps for notifying the ICO and affected individuals about personal data breaches.

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Data Theft in the Modern Workplace 

Work patterns have changed significantly in recent years. Employees often use their own devices, work remotely, and rely on cloud-based platforms, which can increase the risk of data breaches. Remote working can allow individuals to access or copy information without immediate detection. 

Individuals may take information to:

• support their future career plans; 
• improve their position with a new employer; or 
• establish a competing business by taking client lists. 

Information can be obtained in various ways:

• forwarding emails; 
• exporting customer lists;
• saving documents to personal drives; or even 
• photographing screens,

Many employers might discover incidents only after the information has been used or circulated, by which time it is too late.

Commercially Sensitive Information

As reliance on digital information grows, organisations should implement measures to reduce risks to confidential or commercially sensitive material. While there are legal steps a business can take if employees steal data, sometimes the damage is already done. To reduce internal data misuse, implement strong management practices and clear controls. Maintain an employee theft policy and clear rules on data use.

Key commercially sensitive information that should be protected includes:

• customer databases;
• technical know-how; and
• trade secrets.

Safeguarding this information is essential for maintaining a competitive advantage and preventing losses from data theft or misuse.

Legal Considerations Around Data Theft

When someone accesses or misuses information, different areas of UK law may apply depending on the situation. Which laws are relevant will depend on the circumstances and the type of information involved.

Understanding Which Laws Apply

Personal Data:

The UK GDPR and the Data Protection Act 2018 apply to personal data. Unauthorised access, copying or disclosure of personal data may constitute a personal data breach. 

Organisations must:

1. promptly review any incident involving personal data; 
2. document their findings; and 
3. consider whether regulatory notifications are required. 

If staff steal personal data, a reportable data breach occurs. You should notify the Information Commissioner’s Office as soon as possible, ideally within 72 hours. In some cases, you may also need to tell the people whose data was affected.

Computer Misuse

The Computer Misuse Act 1990 applies to unauthorised access to computer material. An employee may commit an offence if they deliberately use a computer to access information without permission.

Illegal Disclosure

The Trade Secrets Regulations 2018 and common law of confidence may apply where individuals misuse, disclose or obtain confidential material or trade secrets without permission. 

Client Confidentiality and Reputational Harm

Many companies agree to strict confidentiality in their client contracts, and if employees misuse or disclose information, it can put the company in breach of those agreements. Clients in regulated or sensitive sectors may take strong action if their information is misused or stolen, which could negatively affect a business’ reputation. 

Reputational damage can affect a business in several ways:

• undermining client trust;
• weakening competitive standing; and 
• affecting long-term commercial prospects for a business. 

Reducing the Risk of Insider Data Theft

Preventing data theft is far more effective than trying to repair damage after an incident. Your business can strengthen its protections by establishing clear rules internally. To reduce the risk of data theft in the workplace, you could:

• implement clear rules that explain exactly what information is considered confidential; 
• set parameters around the use of company data;
• implement training on information and data protection to help staff understand the legal and practical consequences of mishandling data;
• use detection tools to help identify unusual access patterns or unexplained copying and enable fast responses to minimise further risk; and
• spot-check devices and monitor activity appropriately.

End-of-employment periods also require particular attention, as individuals planning to leave may be more inclined to take information.

If workplace data theft occurs in practice, you should take urgent action. Acting quickly with a thorough investigation, preserving evidence, and seeking legal advice can help your organisation:

• understand its responsibilities;
• the relevant laws and risks; and 
• limit further damage in a sensitive, high-risk situation.

Key Takeaways

Workplace data theft can create significant legal, contractual and commercial risks. Remote working, using digital files and engaging in heavy information sharing can increase the likelihood of information being taken without detection. Therefore, you should implement clear steps to reduce risk, such as:

• setting out staff rules;
• restricting access to data; and
• monitoring for misuse.

If a data theft incident arises, your business should act urgently and seek legal advice to protect itself and minimise the potential for wider harm.

If you need help understanding how to protect your data from risk and misuse, LegalVision provides ongoing legal support for all businesses through our fixed-fee legal membership. Our experienced lawyers help businesses across industries manage contracts, employment law, disputes, intellectual property, and more, with unlimited access to specialist lawyers for a fixed monthly fee. To learn more about LegalVision’s legal membership, call 0808 196 8584 or visit our membership page.

Frequently Asked Questions