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Embedding RFID in the Workplace

By Mark Vickers

You could call it a just-in-case legislation. That is, just in case employers someday want to force their workers into having computer chips implanted into their bodies, a recently passed Wisconsin law prevents it.

Welcome to the controversial, exciting, and slightly paranoid era of radio frequency identification (RFID). Let's begin with the exciting part. RFID is far from science fiction. It's a technological trend that, if the advocates are right, is well on its way to becoming an essential business tool and a financial juggernaut.

RFID technology uses a combination of microchips, radio waves, and scanners to transform the way companies track things, especially inventory. By attaching the chips to objects, companies are better able to track everything from books to toasters to factory parts to pharmaceuticals. So far, it's a $2-billion business that might grow to $20 billion by 2010, according to some estimates (DePass, 2006). The number of RFID tags is expected to jump from 1.3 billion in 2005 to 33 billion by 2010, according to market research company In-Stat (Godinez, 2006). Helping drive the trend is Wal-Mart, the world's largest retailer, which is requiring its suppliers to use RFID labels.

There are, however, RFID skeptics. Some argue that the sheer cost of RFID tags makes them less appealing than bar codes. René Jones (2006), founder of Total Logistics Solutions Inc., a warehouse efficiency consulting company, predicts that “less than 30% of the warehouses will have RFID systems five years from now. Other critics are much more concerned with the societal impact, which is where the new Wisconsin law comes in.

In essence, the law states that no one can force a person to have a microchip embedded in his or her body, with violators being fined $10,000 every day until the chip is taken out (Songini, 2006). Other state legislation could follow, with Ohio introducing a similar bill last month. RFID Journal notes that "the Wisconsin law is intended primarily to protect individual rights so companies couldn't use the technology to track employees every move" (Bacheldor, 2006).

Of course, this begs the obvious question: Is there some rash of forced implantation going on in today's workforce? No. Such laws are more like markers that politicians are throwing down to put limits on a technology that might one day be utterly pervasive. There is the case of workers at security firm CityWatcher.com, however, who reportedly volunteered to have RFID chips embedded in their arms. To enter the data center housing servers at the company that provides video surveillance, monitoring and storage for government and businesses, CEO/founder Sean Darks and two employees swipe their forearms across a device that reads the microchip embedded under their skin, reports HR Magazine (Gurchiek, 2006).

But, although novel and unsettling, RFID implants are still a side show. As far as employees go, it's more likely that they're using RFID technology in the form of access control cards. "At least 30 million people carry an RFID tag on them every day in their car keys or in their access control cards to get into their office building to buy gas or to pay a toll" notes Mark Roberti, editor of RFID Journal (Sieberg, 2006).

Are RFID tags secure? One expert has shown a key card can essentially be cloned from a distance. And at a 2005 DefCon technology convention, a number of hackers were able to scan the information on an RFID tag from as far as 70 feet away. Defenders of RFID counter that information on tags is usually encrypted and so such security concerns are overstated (Sieberg, 2006). Others suggest the evolution of tags themselves influence security. "As RFID tags have matured, they've added more memory, and they've become writable, and now [that] you can modify or add data to them, the number of security threats has increased a thousand fold" states Sayan Chakraborty, chief technology officer at SkyeTek, a company that creates RFID tags and readers (New, 2006).

Another major workforce concern was raised by a RAND Corp. study of how six corporations use RFID access control systems. It found that these systems are generally integrated with personnel files and sometimes even medical records. Moreover, in five cases out of six, the records of access card usage were employed to track the movements of individuals as well as groups of employees. The data was even used to investigate allegations of work rule violations (RAND Corporation, 2005).

Despite such monitoring, none of the companies told employees that the access cards were being used for anything other than controlling locks. This is quite different from the upfront communication of many companies in regard to e-mail and Internet usage (Balkovich, Bikson, & Bitko, 2005). The authors of the RAND study note, "We think it is important to have an explicit policy for use of data associated with an access control system, based on conscious decisions about how they should and should not be handle" (p. 17).

Indeed, it's likely that companies will come under increasing scrutiny from legislators and others in regard to policies and processes for collecting data based on RFID technology. Companies should beware waiting until this powerful technology starts getting under the skin many more people.

Balkovich, Edward, Tora K. Bikson and Gordon Bitko. 9 to 5: Do You Know if Your Boss Knows Where You Are? RAND Corporation, 2005.
Bacheldor, Beth. “Wisconsin Governor Signs ‘Chip Implant’ Bill.” RFID Journal, June 2, 2006.
DePass, Dee. “RFID Comes of Age.” Star Tribune. LexisNexis. July 2, 2006, p. 1D.
Godinez, Victor. “Slow Going.” Knight Ridder Tribune Business News. August 6, 2006.
Gurchiek, Kathy. “Security Gets Under Employees’ Skin.” HR Magazine. ProQuest. April 2006.
Jones, René and Sarah Tobaben Dolash. “RFID: Star Potential or Big Bomb?” Electrical Wholesaling. ProQuest. July 2006, p. 62.
Marshall, Aaron. “Microchips Raising Fears; But the Implants Can’t Yet Be Used as Tracking Devices, Manufacturers Say.” Plain Dealer, July 27, 2006.
“New Identification Technology Raises Concerns over Privacy.” The Online Newshour, August 17, 2006.
RAND Corporation. “Privacy in the Workplace.” Research Brief, 2005.
Sieberg, Daniel. “Is RFID Tracking You?” CNN.com, July 18, 2006.
Songini, Marc L. “Wisconsin Law Bars Forced RFID Implants.” Computerworld, June 12, 2006.

Copyright 2006 Human Resource Institute

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