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March 8, 2024 | BusinessEmploymentLitigation

Can A Business Record Conversations with Clients Or Employees?

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Ellie Sanders

Associate Attorney

We have all experienced it:  You call a business number, and they give you the option to receive a call-back rather than waiting on hold.  You decide that is the better option and you press 1 to receive a call back.  Businesses sometimes record these conversations for quality control or quality assurance purposes, in order to enhance the experience of the customer.  But what happens if the business calls you back, records the conversation, but never informs you that the call was being recorded?  The legality of this practice usually depends on what state the person receiving the call lives in.  However, there are many complex considerations and exceptions to this general rule, and in certain cases, federal law will apply. The potential penalties and repercussions should a business illegally record a conversation could be severe.  Businesses could find themselves subject to civil liability or even criminal prosecution.

One-Party States

Most states are one-party states, meaning that as long as one person consents to the recording (i.e., the person physically recording the call), it will be considered a legally recorded conversation. For example, one-party states include: Alabama, Alaska, Arizona, Arkansas, Colorado, Delaware, District of Columbia, Georgia, Hawaii, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Michigan, Minnesota, Mississippi, Missouri, Nebraska, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, West Virginia, and Wyoming. Additionally, under federal law, only one party’s consent is required to legally record a conversation.

Two-Party States

Other states are known as “two-party” or “all-consent” states, meaning that all parties to a conversation must consent before the conversation can be legally recorded.  Two-party states include: California, Illinois, Maryland, Massachusetts, Montana, New Hampshire, Oregon, and Pennsylvania.

What Happens When The Phone Call Crosses State Lines?

Problems can arise when the parties to a phone call are located in different states with different laws.  This is a common challenge for businesses, as businesses could be calling customers located anywhere in the country.  This is an especially important consideration for businesses post-Covid, as many employees continue to work remotely.  Before a business calls its employee who is working remotely from another state, the business should consider whether their consent is needed to record the conversation. Where a phone call involves parties from various states, determining which state law controls and who needs to consent to the recording is a complex exercise.  When there is a conflict between the laws of two states, a court will decide which to apply.  If parties in multiple states are involved, a court may apply federal law.  While federal law requires only one-party consent, the consequences for a violation are harsher than those under some state laws.

How Can My Businesses Comply With The Law?

There are a number of ways businesses can maintain compliance with laws requiring notification to the party on the other end that the call is being recorded.  These include using beeps or tones, pre-recorded notifications before the call actually connects, and requiring the customer to press a button if they consent to being recorded.  An individual also may be deemed to have given implied consent if they continue with the conversation after being told it is being recorded.

What Are The Penalties For Failing To Obtain Required Consent?

The penalties for violating wiretapping laws can be severe.  For example, if convicted under the federal law, an individual could face up to five years in prison and/or a $500 fine.  State laws can be equally severe.  If violating Pennsylvania state law, an individual could be required to serve up to 7 years in prison.


As penalties could be severe and it is sometimes unclear which law applies, businesses should clearly notify the other party that the conversation is being recorded both before and after the recording starts, and businesses should keep documentation to prove they have done so.  This is a good practice to minimize the risk of liability, and it can also be important if the call ever needs to be introduced into evidence, in the event of litigation.  If you have further questions about recording conversations, reach out to a member of our team for next steps.

Contributions to this blog by Dylan Diamond.



Photo by Getty Images on Unsplash
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