An employee needs to respond to a difficult customer email. Instead of spending 20 minutes writing a reply, they paste the message into an AI tool and ask it to make the response more professional.
Another employee uploads a spreadsheet to analyze sales trends. Someone in HR uses AI to summarize notes from an employee meeting.
All three are trying to get their work done faster. None may realize they're sharing information their company would rather keep private.
That's the challenge businesses face as artificial intelligence becomes part of everyday work. Employees can access powerful AI tools with little more than a web browser, often without asking IT for approval.
The question isn't simply whether employees should use AI. It's whether your business knows what they're using, what information they're sharing, and how it's protected.
When someone enters information into an AI tool, that information is processed according to the provider's technology, privacy policy and service terms.
Depending on the product and account settings, prompts and uploaded files may be stored, logged, reviewed for safety or service improvement or used to improve AI models.
That doesn't mean every AI tool uses your information to train its models. Many business-focused services offer contractual protections and administrative controls designed to keep organizational information private.
The problem is that employees may not know which protections apply to the version they are using.
For example, someone might assume that a free personal AI account offers the same protections as an employer-approved business account. That assumption could lead them to share information they would never intentionally publish or send outside the company.
Once you submit sensitive information to an outside service, your business may have limited control over how the service retains or deletes it.
Not every AI prompt creates a security problem.
Asking AI to suggest meeting agenda topics or explain a general Excel formula is different from uploading a spreadsheet containing customer names and payment information.
The risk depends on the information involved, the tool being used and the protections in place.
Here are some common examples.
A sales employee may upload a customer list to identify purchasing trends. An accounting employee might ask AI to review invoices or summarize financial results.
If those files contain names, addresses, account numbers, pricing agreements or other confidential details, the employee may be sharing more than the task requires.
Even with strong security controls, businesses still need to decide whether it's appropriate to share that information with the service.
AI can help draft job descriptions, organize interview questions and create training materials.
But uploading employee evaluations, compensation records, medical information or disciplinary notes creates a different level of concern.
HR information often contains highly sensitive personal details. Depending on the information and your industry, privacy and employee-related obligations may also apply.
An employee may ask AI to summarize a lengthy contract or improve a confidential proposal.
That document could contain negotiated pricing, customer requirements, proprietary processes or information covered by a nondisclosure agreement.
Before uploading it, the employee should know whether the AI service is approved to handle that type of information.
Passwords, API keys, recovery codes and other authentication secrets should never be entered into an unapproved AI tool.
The same caution applies to internal network diagrams, security configurations and vulnerability reports.
These details can be valuable to attackers if exposed, and they may reveal how your business protects its systems.
You may have heard the term shadow IT, which describes technology employees use without their organization's knowledge or approval.
Shadow AI is a similar problem.
An employee discovers a tool that can summarize meetings, generate presentations or automate routine work. They sign up, connect their work account or upload company files without involving IT.
The tool might work exactly as advertised. But no one has checked its data-handling practices, access permissions or security controls.
That's where the risk begins.
A business can't properly protect information flowing into applications it doesn't know employees are using.
And blocking one popular AI website won't necessarily solve the problem. AI features are increasingly built into software employees already use, including productivity applications, meeting platforms and customer management systems.
Businesses need a better understanding of how AI is being used across their existing technology.
AI tools can make information easier to find, which makes employee permissions even more important. As we explain in our article on identity-based cyberattacks, legitimate accounts can create serious security risks when access isn't properly managed.
If your company uses Microsoft 365, you may already have access to AI features through Microsoft Copilot.
Microsoft provides enterprise data protection for eligible organizational Copilot experiences when employees sign in with their work or school accounts. According to Microsoft, prompts, responses and organizational data accessed through these experiences aren't used to train foundation models.
That's an important distinction from assuming every consumer AI service offers the same protections.
However, using a business-focused AI tool doesn't automatically eliminate every security concern.
Microsoft Copilot can work with information employees already have permission to access. If your Microsoft 365 environment contains overly broad file-sharing permissions, AI may make it easier for employees to find information they technically have access to but don't need for their jobs.
Before expanding AI use, businesses should review Microsoft 365 permissions, data-sharing practices and available security settings.
The right tools matter, but so does the way your business manages access to its information.
AI can help employees work more efficiently. The goal is to make sure that convenience doesn't come at the expense of customer trust or confidential business information.
Here are six practical steps to discuss with your IT team.
Start by asking employees how they're using AI at work.
Which applications do they use? What tasks are they completing? Are they uploading documents, connecting company accounts or sharing customer information?
Make it a conversation rather than an investigation.
Employees are more likely to be open about their habits when they understand the goal is to help them use technology safely, not punish them for trying to work more efficiently.
Their answers can also reveal opportunities to introduce approved tools that better meet their needs.
Your business doesn't need a lengthy policy that no one reads.
Employees need straightforward answers to a few important questions:
Use familiar examples.
Instead of simply telling employees not to share confidential information, explain that customer lists, employee records, contracts and financial documents require special care.
A policy only helps when people understand how to apply it during their workday.
Not all AI services handle business information the same way.
Before approving a tool, have your IT team review its security and privacy documentation. If your business doesn't have dedicated IT staff to evaluate new applications, an experienced IT support provider can help you review technology decisions and understand security implications.
Find out whether the provider uses customer inputs to train models, how long information is retained, whether administrators can control access and what happens to company data when an account is closed.
Also, review whether the service allows employees to connect email, cloud storage or other business applications.
A tool that can access an entire document library deserves more scrutiny than one used to brainstorm generic ideas.
Employees should have access to the information they need to do their jobs, not every file their company has accumulated.
Review permissions in Microsoft 365, shared drives and other business applications before introducing AI tools that can search or summarize content. Strong cloud security and access controls help limit unnecessary exposure.
Remove unnecessary access, review shared folders and pay particular attention to confidential financial, HR and customer records.
Good access management protects information whether an employee uses AI or not.
Employees need more than a list of prohibited tools.
Show them how to complete everyday tasks without exposing sensitive information. Regular cybersecurity awareness training can help employees recognize sensitive information, understand company policies and make safer decisions when using new technology.
For example, someone who wants AI to improve a customer email can remove the customer's name, account details and other identifying information before submitting the text.
A manager who wants help creating a performance review template can describe the role and evaluation criteria without uploading an actual employee's record.
Employees should also understand that AI-generated answers can contain mistakes, fabricated references or misleading recommendations.
A polished response isn't necessarily an accurate one. Someone still needs to review the work before it influences business decisions or reaches customers.
An AI policy shouldn't be something your company creates once and forgets.
New tools appear, existing software adds AI features and providers change their capabilities.
Review approved applications periodically. Check whether employees are using new features, whether permissions remain appropriate and whether security settings still meet your needs.
If your business begins using AI for more sensitive work, such as analyzing financial information or automating customer communications, take another look at the risks before expanding access.
Unapproved AI applications are one more reason businesses need clear cybersecurity policies and access controls. Employees should know which tools they can use and what information needs protection.
If any employee accidentally uploads confidential information to an unapproved AI service, ask them to report it to your IT or security team immediately.
Your team should identify what was shared, which service received it and whether the information included customer records, employee data, passwords or other sensitive material.
Depending on the service, it may be possible to delete the conversation or uploaded file, but deletion from the interface doesn't necessarily mean every retained copy has been removed.
If credentials or access tokens were exposed, your IT team should revoke or replace them promptly. If personal or regulated information was involved, your organization may also need legal or compliance guidance to determine whether additional action is required.
The most important thing is to make reporting easy. Employees should know that raising a concern quickly gives the business more options to limit the impact.
You don't need to understand how AI models work to have a productive conversation about protecting your business.
Start with these questions:
Ask whether your organization has a current list of approved applications and a process for evaluating new ones.
Confirm that your AI policy includes specific examples of sensitive business data.
Find out whether employees can access files and information they no longer need.
Ask who reviews data retention, model-training policies, security controls and third-party integrations.
Make sure employees know whom to contact and how your business would respond.
The answers can help you determine whether your current approach supports safe AI adoption or leaves important decisions to individual employees.
If your team needs help reviewing applications, managing permissions or strengthening security practices, proactive IT management can help bring those responsibilities together.
Employees are finding useful ways to incorporate AI into their work, and that isn't necessarily a problem.
The concern is what happens when employees use those tools without clear expectations, appropriate protections or an understanding of where company information goes.
Your business doesn't have to choose between productivity and data security.
Start by understanding how employees use AI today. Give them approved tools, explain what information needs protection and make sure someone is responsible for reviewing the risks.
AI can help your employees work faster. Your business still needs to decide what information it can safely share.
If you're unsure how employee AI use affects your company's data security, Fraser can help you take a closer look at your technology environment.
Our Free Technology Risk Assessment is a starting point for identifying potential security gaps, reviewing existing protections and determining which areas may need attention as your business adopts new tools.