Managers are unlikely to report staff caught looking at child porn at work for fear of getting embroiled in a lengthy legal case.
A survey of 200 firms by the Internet Watch Foundation (IWF) found that 74% of managers would not report staff to the police and 40% would not take steps to discipline or dismiss them.
“There was a fear they would be held liable, concerns they could lose their jobs and just a general lack of idea of what to do with such material,” said a spokesman.
Some managers feared finding themselves caught up in criminal proceedings.
The UK’s child porn watchdog has launched a campaign targeting people who download illegal images at work. Recent legislation makes it easier for technology managers to report such incidents.
The IWF is keen to raise awareness of changes to the Sexual Offences Act which, from May last year, provided a conditional defence to protect network managers who need to store potentially illegal images of children for use as evidence.
The defence is only valid if the incident is reported to the police within a set time limit.
Indecent pictures of children under the age of 18 are illegal – the age was recently raised from.
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In 2004, the IWF received 17,255 reports of illegal child images, 20% of which were on websites.
Only 1% of online child pornography is hosted in the UK, according to the IWF.
