Australia: Social media – how much thought have you given it?

Last Updated: 17 November 2012

By Kristin Ramsey

With many organisations increasingly using social media to promote their brand, communicate with existing and potential customers, and recruit new staff members, it is becoming more and more important for management to understand and appropriately manage the myriad of issues and risks that could arise from use of this technology.

From a legal perspective, these issues and risks pertain to use of social media as a business tool and also potentially to "personal use" by employees.

Getting down to business

Looking firstly at social media as a business or marketing tool first, the ability to "share" and easily reproduce content obtained through online mechanisms, presents a key challenge to all businesses. How can you protect copyright and other intellectual property rights and control the dissemination of information posted for or on behalf of an organisation?

Flowing on from this issue is the question of who actually owns social media content in the first place. Where an employee sets up a blog or creates a social media group for the purpose of commenting on the activities of the organisation or communicating with customers or clients, who owns that content or those contacts? What happens when the employee who has set up these accounts leaves? Does the organisation have any right to claim ownership of the content/contacts? Can the employee use such mechanisms to solicit new business elsewhere?

Whilst we have not yet seen any major litigation in this area in Australia, overseas jurisdictions such as the United Kingdom and the USA have already been called upon to resolve these very issues (often with differing outcomes). These cases have involved balancing the interests of the employer against those of the employee, as well as examining what thought the parties gave to this issue prior to the engagement in social media activities, and what policies and contractual provisions where relevantly in place.

As a manager or business owner, irrespective of whether or not your organisation uses social media as a business tool, most of your employees will certainly be using it. Unfortunately, personal use of social media by employees does not always remain "personal" and the lines between professional and work lives are continually being blurred. The result of this is that your organisation could be liable for the online conduct of your employees. For example, your organisation can be vicariously liable for:

  • breaches of privacy and confidentiality – where your employees post content that discloses confidential, personal or sensitive information about others; and
  • bullying, harassment or discrimination that takes place between staff members over social media.

In addition to being vicariously liable for the online actions of your employees, derogatory comments by employees about other staff members or the organisation itself (through mediums such as Facebook and Twitter) can have a significant impact on your organisation's image and reputation.

Where you stand

In light of the serious consequences that flow from employee use of social media, important questions arise, such as when can an employer restrict the use of social media by its employees, and when can an employer rely on an employee's social media conduct as a ground for disciplinary action or even termination of employment?

Fair Work Australia has been called upon numerous times in recent years to determine whether it was harsh, unjust or unreasonable to dismiss an employee because of their online activities. In addition to the usual criteria for judging whether a dismissal was "unfair", the existence of a company policy regarding social media use and the connection between the employee's online conduct and their employment have been crucial considerations.

When looking to impose restrictions on personal use of social media, establishing a connection between the online conduct and the employee's employment is also crucial. Restrictions that relate to an employee's ability to publicly comment or post material that is directly related to the organisation (including its customers), their employment, or other employees, are likely to have the requisite connection and therefore be considered reasonable.

In circumstances where an organisation has a clear and reasonable policy in place regarding use of social media and an employee breaches that policy, provided procedural and substantive fairness are afforded to the employee, chances are the organisation will be able to successfully defend a claim for unfair dismissal.

Of course, on top of the legal risks there are also inherent business risks associated with use of social media. These include the lack of control over what gets posted about your organisation by disgruntled customers or members of the public and the impact such comments can have on the organisation's image and reputation. This is a difficult issue to proactively manage as generally a customer or member of the public has no legal obligation towards your organisation in respect of confidentiality or privacy - although they can be subject to defamation proceedings in some circumstances.

Mitigating risk

So what does this mean - should you simply avoid social media and prohibit staff from using it too? This is an impracticable solution and, in any event, one that is not likely to remain available for much longer.

The good news however is that all of these risks can be appropriately managed with a few (relatively) simple steps. From a legal perspective, the key is being aware of what is going on. How is your organisation's information being used? What are your employees saying about your organisation? How are staff members interacting via social media etc? Then it is a case of managing the use of social media accordingly and putting in place appropriate safeguards against legal risks.

To help minimise risks and protect your organisation's interests, organisations are encouraged to take the following steps:

  • Put in place a social media policy which (among other things) clearly sets out who has authority to make comments/post material on behalf of the organisation. The policy should also contain guidelines regarding appropriate use of social media and makes employees aware of the personal and business consequences of inappropriate use of social media.
  • Make compliance with the social media policy a condition of an employee's ongoing employment with the organisation.
  • Ensure that employment contracts contain a confidentiality clause that protects the confidentiality of customers and other employees as well as the organisation as a whole.
  • Provide employees with training on appropriate social media use.
  • Where ownership of social media content or contacts is an issue, ensure that contracts of employment clearly sets out who owns content created during the course of employment, and that restraint clauses have been drafted to take into account non-traditional forms of solicitation such as via social media tools.
  • Ensure there is an effective complaints mechanism to properly deal with any complaints by customers so that people do not have to resort to social media "slagging".
  • Go online and seeing what is being said on behalf of or about your organisation.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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