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Business Protection Bulletin


By July 1, 2012No Comments

The “Social Media Revolution” is transforming how Americans connect with their families and friends – and the ways in which companies hire, manage, and fire their most valuable asset: Their workers.

However, failure to provide effective management of social media as an employee relations tool can pose serious financial risks to your business. Read on.

More and more employers begin the hiring process by using Facebook or LinkedIn to garner information about an applicant’s background, associates, and social behavior. Some companies reject candidates based on such behavior as inappropriate photos, references to substance abuse, slanderous comments or opinions, or trashing a previous employer.

‘These activities raise legitimate concerns and companies have an obligation to hire responsibly. However, if you access social media sites that have “protected class” information not usually privileged in the hiring process, you could be putting your business at risk for a discrimination claim. To avoid this problem, outsource hiring to third parties (such as background-verification companies and/or recruiters who document content from social-media sites during the selection process).

Be sure to create, and enforce, a comprehensive social-media policy for employees that: 1) Defines inappropriate use of social media in the workplace (including personal use during work hours, type of content posted, and defamatory statements about the company, managers, and fellow employees; 2) sets penalties for disclosing trade secrets outside the company; and 3) imposes disciplinary action (including termination) for violating the social media policy.

Use caution in developing these guidelines. It’s not uncommon for employees to claim that a company’s social media rules are overly restrictive. To make sure that your policy is in compliance with the National Labor Relations Board standards for protected behavior, consider consulting an attorney with expertise in employment practices law.

Firing: The EPLI Factor
Before you fire an employee for misusing social media on the job, make sure that you have strong documentation for your action.

To help protect your business against losses stemming from allegations of employment discrimination or wrongful termination, it makes sense to buy Employment-Practices Liability Insurance coverage (EPLI). For a relatively small premium, an EPLI policy can save you from litigation expenses that can top six figures — not to mention the danger of financial devastation from an adverse judgment. For more information, please contact us.