Bonding Records Management Staff

Some time ago, when responsible for the management of captured knowledge within a Canadian government entity, I explored with Risk Management experts the impact of privacy legislation on bonding of staff for risk, insurance and security purposes. As someone involved behind the scenes in the development of British Columbia's Freedom of Information and Protection of Privacy statute, I was conscious that the results of proclamation and the inevitable interpretation of law by implementing organisations sometimes caused unexpected consequences. The experience drawn from the effect of Canadian national legislation is relevant and may indicate implications for other jurisdictions in the Pacific Rim and Asia, especially those sharing a foundation in the parliamentary system of government. In this case, we found that:

It may be impossible for a bonding firm to perform a thorough security check as a result of various privacy protections under law (variable across jurisdictions). Therefore, bonding companies may bond individuals without an adequate knowledge of whether they are "bondable" in the sense of the general meaning understood prior to the advent of privacy laws.

The Bond process is typically used when staff of Company A handle monies and funds for Company B. If the staff of Company A should steal the funds, the bonding organization will pay Company B for that loss.

The bond process as described is considered cost effective for bonding one's own staff.

Subject to legal advice obtained and relevant to a given circumstance, we discovered that:

Contrary to management wishes, it is not cost effective to bond individuals hired as temporary back-fill for staff on leave (or due to other staffing need) or to bond the outsourced service staff of other companies handling one's own valuable goods.

If the security of bonding relative to negotiable instruments is required, then any temporary staffing or back-filling may be pursued through a placement agency which takes on responsibility for bonding. In this case, it may be established through contract that the agency is required to supply bonded workers and that the agency is in any case liable for any losses (presumably to be reimbursed through its bonding agent, a separate matter of concern to the agency). Bonding staff for the management of valuable intellectual property remains a questionable matter, especially where the negotiable value of IP is unclear.