Australia: Social networking, social death? Managing your business' and staff's reputation online

Key Points: Being clear about acceptable social networking behaviour by staff, and being proactive, can minimise the risks.

Social networking websites such as Facebook and Twitter raise a variety of issues for businesses. Key amongst these is managing and responding to the reputational risk these sites pose to your business and your staff. This article offers some practical tips for managing and responding to those risks.

Why your online reputation is important

The recent rise[1] of social networking sites and other Web2.0[2] sites (such as blogs and forums), has changed the way the internet is used. What was once a passive tool, used to view or download information posted by others, is now an interactive forum where anyone with internet access can influence website content and share their views with the world.

Once disparaging comments were made by a person within his or her limited social networks (for example, at the pub with their friends). However, these days, emboldened by a false sense of online anonymity or a lack of thought for the repercussions,[3] a disgruntled former employee or customer can just as easily create a malicious MySpace profile of their boss, form a Facebook group to criticise their former employer, or post disparaging comments on a consumer feedback forum (eg.

The fact that this material is posted online can magnify the damage, because of:

  • the larger size of online social networks
  • the accessibility of the material to prospective customers, employers and business associates (eg. through Google searches); and
  • the more permanent nature of online content.[4]

What steps can you take to prevent, minimise or respond to damage to your online reputation?

  • Have clear internet usage policies - Aside from making employees think twice before engaging in unwanted behaviour on these sites, good policies will: (1) make it easier to seek recourse against employees who do breach them and (2) lower the risk of being held vicariously liable for your employee's harmful online actions (eg. for cyberbullying, defamation or breach of copyright).
  • Insert non-disparagement clauses in contracts - Having a contractual term which prevents employees, former employees or business partners from making disparaging statements overcomes many of the problems with traditional causes of action (see below). Ensure that the clauses can be enforced after the underlying contractual relationship ceases.
  • Monitor your online reputation - Simply add you or your company's name to one of the many useful online tools such as Google Alerts, Tweetbeep and MonitorThis. After all, the sooner you notice an attack on your online reputation, the sooner you can respond to it and minimise the damage.
  • If you see something harmful on one of these sites, contact the site - Social networking sites cannot monitor all the content published on their site. However, they all have terms and conditions and, when notified of content that breaches these, will often remove it. Reporting mechanisms vary. On Facebook, the easiest way to remove inappropriate content is to delete it yourself (if, for example, comments are posted on your profile) or, if that is not possible, to report it to Facebook by clicking the "Report" link next to the relevant content.
  • Contact the person making the disparaging statements - They may remove it voluntarily.
  • If all else fails, you can still sue - Just because material is published online doesn't mean that the usual legal actions do not apply. For example, last year a UK executive successfully sued a former friend for defamation and misuse of private information, after the former friend created a fake Facebook profile and a group called "Has Mathew Firsht lied to you". There is no doubt that publishing defamatory material on a social networking site would be actionable by individuals in Australia, and we have started to see individuals commence actions based on such material.[5]

    The big problem for businesses is that, in Australia, profit-seeking companies with more than 10 employees are now statutorily barred from suing for defamation. Companies may rely on other causes of action, such as injurious falsehood or misleading and deceptive conduct. However each of those causes of action faces its own issues.[6] In the light of these complications, the best approach, if it is available, is to enforce a non-disparagement clause.

Thanks to Toby Mullen for his help in writing this article.

[1] Since May 2007, the number of Australian Facebook users has grown from a few thousand to over 6million.
[2] A Web 2.0 site is a site that allows its users to interact with other users or to change website content, in contrast to non-interactive websites where users are limited to the passive viewing of information that is provided to them (Source: Wikipedia).
[3] When Adelaide teenager Christopher Cross was recently convicted on criminal defamation, for comments he posted on Facebook about a police officer, he said he "didn't realise you could get in trouble for things on the internet".
[4] Most content leaves an online footprint, which, even after the disparaging material is removed, may be accessed for years through other sites.
[5] For example, last year, a Melbourne man published apologies in two major papers over comments made on Facebook, and this year, a Western Australian woman launched a claim for defamation and breach of confidence over fake profiles and personal photos published on Facebook and
[6] The main problems with injurious falsehood are proving malice and actual damage to your business. The major problems with relying on misleading or deceptive conduct are that the impugned conduct must occur "in trade or commerce" and that media organisations are generally exempt as "information providers".

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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