A Publication of Pepper Hamilton LLP
Labor and Employment Law Update
Monitoring the Virtual Water Cooler: Facebook and Beyond
Thursday, August 13, 2009
National Public Radio recently aired a story about how employees working at IBM feel compelled to have a Facebook page. It’s not just the newly-minted, tech-savvy, twenty-somethings indulging in social media on company time, either. The report stated that management "all the way up the chain" is on Facebook. With the fastest growing demographic of Facebook reportedly being users over age 35, IBM is clearly not the only company employing growing throngs of Facebook loyalists.
According to the NPR story, IBM is in the minority of businesses that have a social media culture and actually encourage their employees to use sites like Facebook during working hours to build professional networks and exchange business ideas. Instead, more than half of all U.S. companies prohibit the use of such sites at the office. One criticism of the policies banning the use of social media in the workplace is that these sites are merely the next generation of water cooler chit-chat, and companies shouldn’t ban the "new age" water cooler just because the employers are afraid of it or don’t understand it.
However, while social media sites can create positive networks and foster a sense of community and camaraderie among employees, such sites can also create real headaches for employers. What do you do as an employer when you learn too much about some of your employees?
Take, for example, a recent lawsuit in New Jersey federal district court against Houston’s Restaurant in Hackensack, New Jersey. An employee there created a workplace discussion group on his personal MySpace Web page. The discussion group was flagged "private" and was available by invitation only. One member of the group, a hostess at Houston’s, showed the private MySpace discussion group to a Houston’s manager. Other management soon became aware of the group and asked the hostess to provide her sign-in information, which she did. Management was not pleased when it saw that the discussion group included sexual comments about employees and customers, disparaging jokes about the company, and references to drugs and violence. The restaurant fired both the creator of the MySpace discussion group and a contributing employee. The terminated employees sued, claiming, among other things, that the company violated the federal Stored Communications Act and invaded their privacy. The restaurant claimed it had no liability because the hostess voluntarily consented to Houston’s management accessing her private account for the online discussion group. The plaintiffs contended that the hostess was coerced into providing the information, fearing discipline if she did not cooperate.
The jury returned a verdict in favor of the plaintiffs on both the federal Stored Communications Act claim as well as the claims for invasion of privacy. The Houston case presents some unique facts, with a dispute over whether an employee was coerced into providing her log-in information. Although some states have specific statutes regarding employee privacy and off duty conduct, generally speaking, nothing would prohibit employers from taking adverse employment action against at-will employees for this type of online conduct. With so many employees using these sites, it is likely that some employees will invite management to join their Facebook pages or blogs – perhaps without realizing the full consequences. Suppose if instead of making some disparaging jokes about the company, an employee posts explicit pictures from her moonlighting as an exotic dancer, or uses his or her Facebook page to tout Neo-Nazi sentiments or white supremacist ideas? Might the manager be inclined to terminate the part-time stripper on the basis of those pictures? Would the employer arguably be obliged to terminate the Neo-Nazi once it is aware of the employee’s racist and violent views?
Before your company crafts its policy on social networking, consider if your business is in a heavily regulated industry (such as pharmaceuticals) or an industry that requires a particularly high level of confidentiality. The added legal complexities in those industries may weigh in favor of being extremely cautious about embracing social media as a company culture. If you do decide to foster a culture of social media in the office, at a minimum, you should make clear to all employees that they have a duty not to disclose confidential company information or trade secrets, including on any social networking site they may deem to be "personal." It may also be wise to warn employees that they cannot defame the company or its employees. Be clear that any violation of the policy will result in discipline – up to and including immediate termination.
The lines between personal space and the workplace continue to blur. Odds are good that many forms of social media, such as Facebook and Twitter, are already thriving in your workplace. Who knows what technology is next? The way employers are choosing to respond to these technologies continues to evolve, and the laws certainly cannot keep pace. As an employer in the 21st century, it is best to make a conscious decision about how to address these issues with your employees, and proactively develop a policy rather than get stuck doing damage control – and perhaps become the latest talk heard ‘round the virtual water cooler.
Heather A. Hoyt
