Legal Matters: The Dangers of Social Media for Your Nonprofit

For those of you who have ever been involved in a lawsuit, you’ll know what I mean. For those of you who have not, you’ll be forewarned.

This article is about evidence. The best kind. From-the-heart, spur-of-the-moment statements that amount to a virtual paper trail of everything someone says and does. I’m talking about social media evidence — like Facebook and Twitter.

As a trial lawyer, I get excited when I find or receive Facebook and Twitter pages from my opponents in a lawsuit. People love to rant and rave about their jobs on social media. These posts usually contain a treasure trove of evidence that can be used in favor of, or against, a company.

Here’s a war story that will make you cringe. I represented an organization that was sued by a former employee. The executive director fired the employee for performance issues. The employee hired a lawyer who alleged that the company’s explanation for firing was pre-textual and the actual reason for termination was age discrimination. In discovery (where parties request and obtain relevant documents from the other side), I requested and obtained printouts of the employee’s Facebook posts. What we found was shocking — this employee had been disclosing the company’s confidential information and trade secrets for months, bragging about the company’s revenue numbers and plans for growth that were supposed to be confidential, on Facebook. This public disclosure of confidential information has serious implications to the company — trade secrets must be kept confidential, otherwise they’re no longer trade secrets.

Ironically, this bragger employee also posted about how, since his termination, he was spending every day relaxing (rather than looking for a new job, as he testified in his deposition) and how he was going to buy a new BMW with the money he was going to receive from his lawsuit.

What was found on my client’s executive director’s Facebook page was even more shocking. The executive director naively had been posting about how much money older employees cost companies in the U.S. and how he intended to do something about that for his company.

Needless to say, the case settled before discovery concluded.

The bottom line is what employees post on social media can impact the company in many ways. Here are some things to consider in our new social media world:

1. Employees’ social media posts can subject the company to liability. A false post about the company’s or a competitor’s product can lead to claims for deceptive trade practices and false advertising.

2. Employees’ social media posts can lead to a loss of trade secrets. As illustrated in the above example, employees’ posts may cause the company to disclose trade secrets or other confidential information. Such posting can be unintentional; an employee may issue a post about a new service or product that is premature.

3. Social media posts can provide useful information for hiring or a basis for firing. The social media posts of prospective employees can provide a host of information about the applicants, more information than that provided on a résumé. In fact, some companies ask job applicants to provide their passwords for their social media accounts prior to making the decision to hire the applicants. Be mindful, however, that employees’ posts on social media sites can be protected speech. Refusing to hire, or firing, employees based on this speech can lead to discrimination claims against the company. Deciding whether to use social media posts as a basis to hire or fire is like walking a tightrope — it requires balancing many factors, and given the potential liability, it should be discussed with legal counsel first.

4. Adopt a social media policy. A social media policy sets forth the company’s guidelines for social media communications and is a company’s first line of defense to reduce risk. Be sure to include provisions in the policy that address trade secret protection and employees’ statements about the company’s and competitors’ products. In addition, consider including provisions that address ownership of social media accounts, user names and content. The following are some ideas for what should be contained in a social media policy:

• Posts should not disclose any confidential or proprietary information of the company or any third party.
• Employees should not comment on any aspect of the company’s business; if they do, they must clearly identify themselves as employees and include a disclaimer that the views expressed are solely those of the employee and do not reflect the views of the company.
• Employees’ Internet postings must respect intellectual property, privacy and other laws.
• Employees must obtain company approval when posting about the company’s business and competitors.
• The company reserves the right to request that certain posts or other content be removed from social media sites.

These are just a few examples of guidelines for a social media policy. In the meantime, let’s hope your employees’ Facebook or Twitter postings don’t end up being used against your company in a dispute.

Lisa A. Lori is a partner in the law firm of Klehr Harrison Harvey Branzburg LLP and a member of the NonProfit PRO Editorial Advisory Board. Reach her at llori@klehr.com