A Social Media Policy for Your Company

Social networking sites reach millions of people and have significantly changed the way people communicate and interact online. The influence of these sites can be enormous. Some of your employees may use social media while on the job or away from the workplace. And it’s possible that their use of these media could create legal problems for you and your business. Even if you only have a couple of employees, you should be aware of potential trouble spots.

There are two areas that you should be concerned about: the perception that employees are speaking on behalf of your business and leaks of confidential or proprietary information. A specific company policy regarding employees’ use of social media may offer your business some protection.

Who Speaks for Your Business?

Your company’s public image and standing in the community could suffer if an employee who has identified him or herself as a company employee uses offensive language online. Or, what if an employee uses a social media site to endorse or to offer a testimonial about one of your firm’s projects, a condo development, for example, and does not disclose his employment relationship? Your business may be found to have violated the Federal Trade Commission (FTC) Act if someone later claims that he or she was misled into buying what is alleged to be a defective product based on your employee’s comments. Essentially, under FTC guidelines on the use of endorsements and testimonials, employees may be considered paid endorsers for your company by consumers even if your employees are not authorized to speak on your company’s behalf.

The FTC has stated that it generally won’t take action based on the activities of a single rogue employee. However, it has also indicated that it could take action against businesses whose failure to establish or maintain appropriate internal procedures resulted in a consumer injury.

Leaks of Confidential Information

Employees may accidentally disclose financial information, marketing plans or expansion strategies on a social network site they frequent. You may not discover that the leak occurred until it’s too late and the damage has been done. The result could be a financial or strategic loss for your business.

A Solution

A written company policy on your employees’ use of social media could help minimize liability issues. We recommend that you involve your legal advisor in drafting your company’s social networking policy.