Business

$1.2 MILLION FINE LAID ON IKEA FOR SPYING ON EMPLOYEES

by H. Haverstock

June 15, 2021

PARIS — A French court ordered IKEA to pay a 1 million euro ($1.2 million) fine for spying on its French employees on Tuesday, after the world’s largest furniture retailer was found guilty of improperly gathering and storing employee data.

The French branch of Ingka Group, which owns the majority of IKEA stores worldwide, has been accused of spying on its employees and some customers for several years.  The flatpack furniture company, which admitted to some improper practices, was accused of violating employees’ privacy by reviewing bank account records and sometimes using phony employees to write up reports on staff.

According to worker representatives, the information was used to target union leaders in some cases or to IKEA’s advantage in customer disputes after the company trawled data on people’s finances and even what cars they drove.  It was also discovered that it had paid for access to police files.

Prosecutors had sought a fine of 2 million euros.  Lawyers for France’s CGT union and several individuals seeking compensation said the final sum was not large, but they were pleased with the result.

After taking steps to eliminate the surveillance tactics, the company said it was reviewing the court decision to see if additional measures were required.  IKEA Retail France has strongly condemned the practices, apologized and implemented a major action plan to prevent this from happening again.

IKEA employs approximately 10,000 people in France, its third largest market after Germany and the United States, and has experimented with new formats there, including a store opened in the heart of Paris in 2019. 

Jean-Louis Baillot, the firm’s former chief executive in France, was found guilty in the case and sentenced to two years in prison with a two-year suspended sentence.  He was fined 50,000 euros by the judges for storing personal data.

In total, 15 people were charged in the trial.  Two of the accused, including a police officer, and Stefan Vanoverbeke, who ran IKEA in France from 2010 to 2015 and still holds a senior position in the group’s retail operations, were found not guilty on all charges.

Others were found not guilty of some charges, such as systematically disclosing confidential information, but guilty of others, such as illegally obtaining personal data.

Sanctions ranged from a 5,000 euro fine to several suspended prison sentences for a former human resources manager.

After the allegations surfaced in 2012, IKEA fired several managers and overhauled its internal policies.

The Swedish company has long denied establishing a widespread espionage system and was cleared on Tuesday of systematically violating personal data.

Categories: Business

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