SAN FRANCISCO – Most employees know their bosses are usually within their rights snooping on workers' e-mail, but text messaging has been in murkier territory.

A federal appeals court sought to clarify matters in a ruling Wednesday by distinguishing between electronic communication that employers store on their servers, or pay someone to store, and communication they contract out for.

Employers must have either a warrant or the employee's permission to see messages that aren't stored by the employer or by someone the employer pays for storage, the court said.

The ruling from the 9th U.S. Circuit Court of Appeals in San Francisco, hailed by digital privacy advocates, could create new administrative hurdles for companies to clear before handing out wireless devices.

Employers may now need to use more concrete language in their privacy policies and make sure they explicitly assert access to text-messages as well as e-mail, to encompass communications that aren't under their physical control. To spare lengthy court battles later, written agreements covering employees' work-issued cell phones, for example, probably should say employers have the right to see all e-mail and text messages their workers send with the devices.

Among other privacy advocates, Jeff Chester, founder and executive director for the Center for Digital Democracy, praised the ruling.

“Mobile privacy is increasingly a political and legal battleground – it's a very confusing regulatory landscape, there are no clear rules in the crazy quilt of the mobile communications systems,” Chester said.

The ruling limits all kinds of entities' access to consumers' communications, he said.

“Preserving as much privacy for the mobile consumer, and limiting the ability of government and commercial entities to readily access your mobile information is important, and the court did the right thing here,” Chester said.

Corporate e-mail has typically been stored on a company's own servers or on server space it pays for, which employers control, according to federal law. Text-messaging has typically been managed by outside providers.

The lower court had ruled that employers have access to text messages because they're stored by the outside contractors, but the 9th Circuit found that the storage was incidental. Greater privacy protections apply, the court said, because employers are paying only for messaging services.

It's not clear, however, how employers should now manage the relationship with an employee who splits the bill for a work-issued cell phone or other message device, a common arrangement.

In that case, the employee might be reluctant to give his employer full access to his text messages, since some are presumably personal.

“It's going to highlight for businesses the need to think through, 'What kind of information do they need? What kind of access do they need to have? And what kind of documentation do they need to have in place to get that access?'” said Joel Reidenberg, a professor at the Fordham University School of Law and an expert on information privacy law. “A ruling like this is going to force companies to be more nuanced and careful in their data management, and that's a good thing.”

The ruling came in a lawsuit filed by police officers in the Southern California city of Ontario alleging the police department illegally examined text messages they sent from work-issued pagers.

The department wasn't investigating the officers for a crime. It was trying to determine how much money one of them, Sgt. Jeff Quon, a member of its SWAT team, should pay for personal text messages.

The officers argued – and the appellate court agreed – that the department shouldn't have been able to view the messages without their approval or a court order. They rested the argument on existing legal distinctions between service providers being paid for storage and those that aren't.

In the case of the Ontario police officers, the 9th Circuit agreed they had a reasonable expectation of privacy in their text messages because the department had an informal policy of not examining text messages that employees paid for. The court said the department's search violated the officers' Constitutional protections against unreasonable searches and seizures.

“The holding that text messages and e-mail are protected by the Fourth Amendment is an immensely important one which gives the victims of unlawful searches the ability to suppress illegally obtained evidence,” Jennifer Granick, civil liberties director at the Electronic Frontier Foundation, wrote in a posting on the organization's Web site.