Social media has tremendous implications for even the smallest business. It is immediate, it is cheap (or free), it has a potentially huge reach and it is friendly to that typically desirable demographic, adults 18-35. Facebook, Twitter, LinkedIn, Pinterest Yelp, Instagram, Vine, Snapchat, WhatsApp, Reddit and even text messaging all fall within the broad definition of “social media.”
Businesses can and should routinely Tweet and post as a way of instantaneously communicating with consumers. But therein lies the rub: how does a business Tweet or post since a business can take no action apart from its human actors? The company’s engagement with social media is thus often left to its employees. Many times, employees manage the company’s social media flawlessly, but sometimes, things go wrong.
Here are some of the legal risks that can fall on employers when employees use social media: unintended contract or warranty modifications; defamation; false advertising; right of privacy/right of publicity violations; breach of contract; breach of a non-disclosure agreement and the resulting loss of trade secrets; insider trading; obscenity violations; copyright infringement; FTC or Consumer Protection Act violations; cybersquatting; and trademark infringement.
For example, assume that an employee is instructed to use social media to communicate with consumers. The well-intentioned employee “right clicks” on a photo on a competitor’s website and posts it to Instagram, Pinterest and Flickr along with a humorous but disparaging comment. That simple act could expose the employer to claims from the competitor for, e.g., copyright infringement, defamation, false advertising and a Consumer Protection Act violation. Or, consider an employee using WhatsApp or Snapchat to circumvent established corporate communications channels and avoid keeping a record of the communication.
While these fact patterns most often arise in environments in which employee use of social media is unregulated by the employer, the prevalence and widespread acceptance of social media as a marketing tool leads to such events even in regulated workplaces. Employers would be well advised to attempt to manage the risks arising from employee use of social media by adopting and implementing one or more of these strategies:
1. Ban it. A top-down ban on employee use of all forms of social media during work hours or in connection with work might be considered, but such a ban should be a last resort, as the National Labor Relations Board has found such bans can be unlawful. Another problem with such a strategy is the loss of an otherwise very powerful marketing and customer communications tool.
2. Institute and enforce Social Media /Bring Your Own Device (“BYOD”) policies in your workplace. These will not stop you from being sued for an employee’s social media misconduct, but they will help you create a defense in that lawsuit to show you had policies in place and that the implicated employee violated them.
3. Insurance. Talk to your risk manager or insurance agent and ask if your business liability insurance policy covers cyber-risks and advertising injury. This is a fairly specialized form of coverage, so you have to ask the right questions, identifying the types of risks for which you are seeking coverage, e.g., Internet defamation, copyright infringement, false advertising, by name.
4. Training. Prepare and present regular employee training on how to use social media correctly. Again, this will not stop you from being sued, but it will help create a defense to show that the company was, at all times, trying to do the right thing.
5. Vigilance. The company should actively monitor as many forms of social media as possible for instances in which the company’s name, trademarks and other common identifiers are used so that those instances can be scrutinized, and if problematic, removed or otherwise addressed. Most social media platforms have a mechanism that allows the original poster to remove the content–it is much more difficult for a third party to obtain removal unless a recognized intellectual property right has been violated in the post.
These recommendations only address employee use of social media. A related but different set of issues arises from both (a) an employer’s wrongful use of social media in hiring and employment decisions, and (b) former employees using social media to try and harm the former employer. Many businesses have been negatively affected by a poor review on Yelp, for example, on facts that would suggest that the post was placed by a disgruntled former employee. Businesses should be mindful of these social media issues as well. Stay tuned for discussions of these related topics in future columns.
Brad Frazer is a partner at Hawley Troxell, where he practices Internet law, publishing law and copyright law. He is a published novelist and a frequent author of Internet content. He may be reached at [email protected]. A version of this column originally appeared in Idaho Business Review, sister publication to The Daily Record.