Companies would be legally remiss not to add a social media
component to their corporate compliance and ethics program. As we
have seen and reported on, agencies such as FINRA, the FTC, and the
NLRB are bringing complaints against companies arising from their
social media activity or employee related activity, thus,
highlighting the need for companies to demonstrate that they are
exercising due diligence to promote ethical conduct and prevent
criminal conduct in the context of social media activity
[e.g. Federal Sentencing Guidelines, § 8B2.1].
The following list is a good starting point, however, there may be additional items that a social media attorney will recommend you include in your policy depending on the nature of your business. A companion article to this one, for example, includes additional items that government contractors should have in their social media policies.
- Adopt a
social media policy. Include the basic list of "Dos"
and "Don'ts" in your policy. Don't try to
prohibit lawful protected activity such as complaining about work
conditions or compensation/benefits, or whistle blowing. However,
employees should be advised of the importance of communicating
possible wrongdoing at the company through established internal
channels so an appropriate investigation can be conducted.
- Implement an effective training program on how your employees
should use social media, with emphasis on areas of particular
concern for your company which may include, for example, protecting
the privacy interests of your company clients, complying with
FINRA/SEC social media guidelines, antitrust compliance, not
disclosing confidential, proprietary information, and brand
- Update your
e-discovery approach and make sure that you include social
media activity and cloud computing because it is
- Update your document retention policy to make sure you are
capturing and storing the social media activities of your company,
and don't forget employees conducting business from their smart
phones and tablets.
- Update your Sarbanes-Oxley Act compliance program to ensure
that financial information posted on your Facebook fan page,
Twitter, website, etc., is updated to reflect material changes in
financial condition and operations. Do not release financial
information on social networking sites that you have not also
published in a press release.
- Audit the social media activity of potential targets for
mergers and acquisitions to identify any legal risks and
liabilities, including, without limitation, the target failing to
comply with the Sarbanes-Oxley Act.
- Train your HR department, managers and anyone making
employment decisions so they do not use information from social
networking sites to discriminate against anyone based on protected
factors under federal or state law. Set up protocols so protected
factors are not considered.
- Take reasonable measures to protect your
trade secrets. Update your confidentiality agreements and
computer use policies with employees. Clearly communicate what are
the company's trade secrets and the ways in which use of them
is restricted. One of the essential elements for a misappropriation
of trade secrets case is that the company has taken reasonable
measures to protect its trade secrets, which would include, in the
social media era, a social media policy with training for employees
so they are not inadvertently disclosing the company's trade
- Incorporate privacy protections into your business practices
such as data security, the collection of a reasonable amount of
information and not more, sound retention practices (not an unduly
long period of time), and data accuracy (so misinformation is not
reported on consumers).
- Review the FTC guidelines for online endorsements with employees, including the prohibition on employees giving reviews for the company's products (or the products of it's competitors) without disclosing their biased relationship with their employer company.
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.