Metaverse series #2: Working in the metaverse – emerging employment issues

Hybrid and remote working have undoubtedly accelerated the use of virtual working for many workforces and whilst the metaverse might still be in its infancy, employment issues are already starting to emerge. Although this is new ground and the issues will evolve as we find our virtual feet in the metaverse (do avatars even have legs yet?), we consider key employment and HR issues for employers to be mindful of when offering workspaces in the metaverse.

How will employees represent themselves?

Employees in the metaverse will be represented by avatars. But to what extent will employers be able to control how employees’ avatars reflect their ‘real life’ identities? Will employers be able to dictate that an employee’s avatar must reflect their true physical appearance, age, gender, ethnicity, style, or even disability?

Can avatars  be held responsible for their actions and conduct? In turn, could an employer be vicariously liable for the acts of an avatar, or have duties of care towards the avatar, or other avatars, based on assumed knowledge of their ‘virtual’ or ‘in real life’ characteristics?

New harassment and discrimination risks?

There have already been multiple reports of virtual sexual harassment and inappropriate conduct in the metaverse, with some employers taking steps to ensure virtual boundaries and distancing measures are introduced. It is also possible that employees may be subjected to less favourable treatment because of a deemed or assumed protected characteristic. For example, if employees have freedom to choose their avatar’s appearance, are there further risks of discrimination, cultural appropriation, or stereotyping certain groups?

An employer’s duty of care in a virtual world?

UK employers have a duty of care to their workers to ensure a safe working environment. How do employers meet this duty in a virtual working space? When might an employer be vicariously liable for the acts of others in a virtual world, and what steps might an employer be reasonably expected to take to make the metaverse a safe place of work?

Impact on standards of conduct and professionalism?

There are concerns that working in a virtual space could have a negative impact on performance, productivity, professionalism, and conduct. Employers will need to consider how best to manage this, including the level of monitoring and surveillance that is appropriate and lawful in a virtual world, as well as controls they can put in place around conduct and performance.

Impact on culture, diversity and inclusion?

Employers will need to be mindful of the impact on wider workplace culture that comes with a virtual working environment. With any substantial change in ways of working, there is a risk of creating a two-tier workforce - in this context: those who are non-users or slow adopters of the metaverse; and those who are willing to embrace it and work willingly in a virtual world. 

Employers will need to consider how working in the metaverse might impact diversity and inclusion in this regard if certain demographics of the workforce are not comfortable working in a virtual world and feel alienated by these new ways of working.

Impact on employee wellbeing?

Employers are already having to consider the impact of remote and hybrid working on employees’ wellbeing and mental health as the boundaries between work and personal life become more blurred. Arguably, having a virtual space in which to work and be ‘present’ without clear boundaries of separation could create further challenges with a workforce that is constantly connected and with a virtual and immersive presence.

What about data protection?

The metaverse involves greater degrees of submersion into a virtual world than our current internet. In the metaverse it is possible to assess and measure physical movements and facial expressions of users, as well as a myriad of other reactions and responses. How will employees’ personal data be collated, used, and stored in the metaverse? How do employers ensure compliance with global teams across differing laws and regulations?

Which location, governing law, and jurisdiction?

There are no geographical boundaries to the metaverse, and employers may have employees working together from different locations on the same matters and in the same virtual spaces. It may not be obvious which jurisdiction applies, or which employment laws govern certain employment relationships. 

Will governing law and jurisdiction be based on where there is a greater connection to a particular jurisdiction? Could it be dictated by where the company owning the platform, or its servers, are based? Is there a risk of creating branch or residence status in new jurisdictions from a tax perspective?

Working time: when does it start? When does it (ever) end?

When will working time begin and end for employees when they are present in the metaverse? Will they be “working” for the purposes of accruing national minimum wage and holiday entitlement when simply present in the metaverse? How will these principles change across differing laws and jurisdictions?

How are employees paid?

Working in the blockchain enabled metaverse will likely facilitate new ways of paying or rewarding employees. But there are issues with using cryptocurrencies or NFTs as a means of employment income and reward. Employers will also need to ensure ongoing compliance with tax, minimum wage, holiday pay, social security, and other benefit requirements.

And finally...the upside!

To end on a more positive note, the metaverse provides a level of connectivity between colleagues in a virtual world which solves many of the problems of working alongside colleagues remotely. Being able to sit at a virtual table with your colleagues – but from the comfort of your home – and respond to their cues and body language can enhance workplace relationships in ways that is difficult to achieve over a 2D video call.

The metaverse also offers the potential to weaken office bias where employees will be operate in the same medium. It could be a leveller for diversity and equality issues and help to reduce unconscious bias at work and lead to fairer decision making.

For now, many of these issues are untested and this is unchartered territory for many employers. But for those employers who are already investing in, or working in, the metaverse, they may need to swiftly grapple with some of these issues head on to manage risk appropriately.

Next up....

Read more on why we should care out the metaverse in post 1# of this Tech Insights Metaverse series and on the opportunities and risks in the the metaverse in the lead article of our Tech Legal Outlook 2022 - Mid-Year Update. Next up in the series we'll be looking at the metaverse through the antitrust lens and at potential competition law issues.

Read the full Metaverse blog series here Contemplating the metaverse: Opportunities and risks (linklaters.com)