Employers’ Liability for the Activities of Employees
Social media has created many opportunities for companies to expand their business, but these opportunities have come with a new set of risks. Multiple exposures occur within the digital realm. The most common include:
Harassment – That of co-workers, business partners, and customers. If an employer is found to have turned a blind eye to harassment, it may be found to have some measure of liability. Simply providing internet access is not always cause for liability, but can still lead to high defense costs and reputational damage.
Defamation – If a company provides a form of social media, for example, a message board system, they can be found liable for negligent supervision if they allow defamation to occur through that media with no monitoring.
Violation of Trademarks – Companies should monitor their social media pages to ensure employees are not posting the Trademarks of other corporations on their pages. If left unchecked, this can lead to litigation for infringement.
Revealing Proprietary Client Information – As nice as it may be to talk about our success sometimes, much of the information seen at work is confidential. Leaking it to the public can have expensive repercussions. There are many pieces of legislation regarding personal information that can’t be publicly exposed.
Endorsement and Testimonials in Advertising – Employees posting positive testimonials about their place of employment without disclosing their position within the company open exposure to FTC violations.
Damage to Reputation – Employees posting pictures or videos to their social media of inappropriate actions while at work can lead to disparaging views about that company. Often, public opinion damage can create large losses in business dealings.
There are many ways to prevent exposures to liability through social media. Some companies block or limit access to non-business websites. The main tool to combat improper behavior in social media is education. When employees are taught about the negative consequences associated with certain behavior, they take greater care in monitoring themselves. It is advised each company evaluate its exposures and create a program appropriate to its needs.
“No magic formula will completely eliminate an organizations exposure, but a social media policy in combination with employee training and a comprehensive insurance program will provide a solid line of defense.”
Insurance – In the event that a lawsuit does occur, a comprehensive insurance program is an essential element to any risk management program. Rarely will only a commercial general liability policy provide the necessary protection. The combination of commercial general liability, cyber liability and employment practice liability (EPLI) policies usually offers the broadest and most comprehensive coverage. Consultation with an insurance advisor is recommended to help identify exposures, determine which policies provide the best coverage, and explain how they would be triggered in the event of a loss.
Conclusion: The reality is that social media use by employees in the workplace is here to stay. Whether employers embrace the technology or discourage its use is up to them, but the potential liability will exist either way. Social media technology is constantly evolving, for this reason, it is important that an employer understands its exposures, stays on top of the trends and issues and makes educated decisions about how best to protect itself.
Source: Social Media Whitepaper/Advisen, Ltd