HR advice needed for small business

We have fewer than 10 employees. It has come to my attention that one of them is corresponding with potential future employers while at work, using our time/computer/network & email address! This person has signed a company "no expectation of privacy" policy memo. Our handbook doesn't specify that job-seeking is not permitted while you're on the clock, but we consider this time theft. Should this person be written up and given a suspension or can this person be fired with a degree of certainty that no unemployment compensation will be awarded?

If you consider it time theft, I assume no one at the office reads the news, posts on message boards, or does any other surfing or non-business communication of any kind during their idle time, right?

Otherwise it's a bit hypocritical to start picking and choosing *which* idle-time network usage you consider "theft" and which usage is considered a common benefit of the modern workplace.

If they want to leave, let them go. Don't make a scene about it with notes and write-ups to create a paper trail you won't even have time to point to in the event of a dismissal, because this employee is out the door at their first opportunity. Or, worse, they WON'T get a job that quickly and you won't have grounds to fire them, and then everyone's really miserable for six months.

As long as they understand that they'll be interviewing on their own time and they don't use your stamps, who cares. Being there doesn't work for them anymore for whatever reason, and it's no longer working for you; being supportive or at least neutral about their search and departure (within reason) will make this end quickly and with the least bloodshed. No unemployment compensation, no lawsuit threats, no covering your butt, just smooth sailing out the door.

You said yourself this person isn't violating any policy, and isn't costing you anything in network or computer use that you weren't paying before. Despite resenting that this person is "breaking up with" the company, you both want the same thing here -- Let them leave gracefully and spend your energy instead on finding their replacement.

i suggest writing the employee up and suspension due to the fact it can cause some legal problems if he/she is wrongfully fired

You don't have to specify or make a job seeking policy. This person is conducting personal business on company time. Definitely give them a written warning. Make sure you write out the steps they need to take to correct the situation: So and so understands that while working for XYZ, they should not be conducting personal business on company time. If you want to get rid of this employee, let them submit their timesheet. It would be considered fraud--falsifying their timesheet--which is grounds for firing. If you or someone there is computer savvy and can tap into their email, all the better. Copy the emails as evidence. While on duty, they should not be surfing the internet, writing personal emails, whatever. Company business only. It all depends on how you want to handle it. If the email mention their wanting to leave the company, you can take that as their notice. Instead of requiring him to give you a 2 week notice on that, you can just have him fill out his exit interview and he can leave right then and there. '

Here is the web site for the Dept of Labor and the work laws. It's very interesting.
http://www.dol.gov/dol/topic/index.htm