Psst! Did you hear about gossip at the office?

— -- Office gossip, though rarely talked about or researched, has taken on new dimensions in this high-tech age, becoming a dynamic force that can build camaraderie but can also destroy work relationships or careers.

The proliferation of instant messaging, Internet blogs and e-mail means rumors in the workplace spread faster and farther, and can do more lasting damage.

Jon Bender, a managing partner at PrincetonOne, an executive search firm, says he once received an e-mail about himself that had obviously been intended for someone else.

"I went to the person and said, 'You're upset, let's talk about it, but it's not appropriate in an e-mail,' " Bender says. "Office gossip has always been dangerous, but now with technology, it's also instantaneous. … Once you hit send, you're done."

Nearly two-thirds of employees say that people in their workplace gossip about company news, according to an August study by Steelcase, a Grand Rapids, Mich., provider of office furniture and equipment. Twenty-eight percent of employees who work in offices without a consistent method of communicating news (such as staff meetings) say gossip is their first source for information.

Today's water-cooler conversations are more likely to take place in the office break room (36%), at a co-worker's desk, workstation or office (33%), or through e-mail or instant messaging (10%). Just 1% of employees say they head to the water cooler to learn what's really going on.

Gossip generally takes two forms, either rumors about company changes, such as mergers, layoffs, managerial promotions or staffing changes, and personal gossip about specific employees: who is doing well, having an affair or grappling with personal problems. Because people spend more of their waking hours today at work than with their families, offices are rife with gossip — and both kinds of rumormongering can be detrimental to the workplace.

It can even cost employees their jobs. Four employees of the town of Hooksett, N.H., were fired in April for discussing rumors about an alleged relationship between two town employees. The national media attention generated by the firings thrust the issue of office gossip to center stage.

The fired employees have retained a lawyer and claim the town council has no authority to hire or fire. A town petition with hundreds of signatures was also gathered in support of the four fired workers.

Officials with the town of Hooksett did not return calls seeking comment.

Lawyers say they're fielding new questions from corporate clients on what rights employers have to limit or discipline employees for work-related gossip.

"I've even seen rules about gossiping now in company handbooks," says Bill Nolan, an employer lawyer at Squire Sanders & Dempsey in Columbus, Ohio.

But gossip can be hard to ban, because employees can't legally be barred from discussing employment-related matters. "So it can become a tricky issue for employers," he says.

A tool for management

Gossip can be an invaluable tool for managers, who may be able to keep a better pulse on what's happening in the workplace by relying on information from employees who are known for spreading and knowing office gossip. Managers may mine these office gossipers for information about morale, turnover or productivity problems afflicting employees.

That's what happened at Hakia, an online search company based in New York. A valued employee planned to take a job at another company, and word that the colleague would be quitting spread via office gossip. By the time he finally broke the news to supervisors, many of his fellow employees and top executives already were aware of his plans.

"Management will find out about it through the grapevine," says Melek Pulatkonak, president and chief operating officer at Hakia. "But gossip here isn't as bad as some places, where going to work was like going to war. I've worked in places where people gossiped all day. It really was a shame."

There are some serious downsides to workplace gossip. Among them:

•Lawsuits. Gossip spread in e-mail can be used to support a defamation case and can also come back to haunt employers: If an employee spreads malicious gossip via e-mail and the target of the gossip finds out, he or she could make a case for harassment or a hostile work environment claim.

Policies or legal action regarding gossiping can be hard to enforce because a number of states also have laws preventing employers from disciplining employees for off-hours behavior, such as gossiping during breaks or after work, says labor lawyer Nolan.

The Internet and e-mail have created greater legal risk. Gossip that is posted on employee blogs can come back to haunt employers and employees. Says Nolan: "Once it's committed to writing, there can be trouble."

•Career damage. Employees known as gossips can be valued by managers who see them as a way of getting a read on workplace morale, but they can also be viewed as not trustworthy, says Kelly Davis, owner of The Strategy Tree, a Danville, Calif.-based provider of human resource consulting services. A false rumor can easily derail a fellow employee's career.

"If you get the reputation as the office gossip, you don't get promoted," Davis says. "I've rarely seen gossip be a positive thing."

Margy Judd, 44, who owns an event- and meeting-planning company in Cleveland, says she has seen firsthand how gossip can endanger careers. In a previous job, one woman was landing twice as many clients as everyone else. A false rumor quickly spread that she was providing various favors to clients. "It was jealousy. She was kicking everyone else's booty, so they undermined her reputation," Judd says. "She wondered why everyone treated her so badly and never knew. She eventually just left."

•Productivity drain. The time spent on office gossip, whether about personal issues or possible company changes, can take away from time that should be devoted to work.

The average employee spends 65 hours a year gossiping at the office, according to a July 2002 survey conducted by Equisys, a business communications company.

Gossip not easy to escape

As an assistant manager at a major discount retailer, Lisa Hammond expected her job would involve supervising employees. She never expected it to involve managing never-ending office gossip.

But that's what the job became. Hammond, 40, says she had to contend with employees who formed cliques. Rumors spread around the store that one worker who was absent from the job actually had been abused — a story that turned out to be false. Other co-workers whispered about whether another employee was having an affair.

"Gossip became a huge part of my day. … It consumed me," says Hammond, of Goessel, Kansas. "There was gossip about whether we were going to company uniforms, gossip about employees. It's terrible. In terms of productivity, it had a terrible effect."

So a few years ago, Hammond quit her job, bought a farm in the country, and now contracts with LiveOps, where she's a customer call agent while working from home. The biggest relief, she says, is that working at home has freed her from dealing with office rumors.

Still, gossip is, to some extent, human nature, and it can help build office friendships and teamwork. It can also be invaluable to new hires who are trying to learn office customs not covered in the company handbook, says Tom Musbach, managing editor at Yahoo HotJobs, an online career resource.

"Everyone wants to feel they're in the loop," Musbach says. "It can help build camaraderie."

Not everyone is convinced. Ryan Larson, 25, works in auditing in Boise and says he has been the target of negative office gossip before. He had complained to a co-worker about a business trip, sparking a rumor that he didn't want to travel for work.

The problem, he says, is that management can hear the gossip, but it's often untrue.

"People will pass along gossip, and management will hear half-truths," Larson says. "Every time the gossip is passed along, it changes. … And gossip is everywhere. It's impossible to get away from, but it's something no one talks about."