Creating a Dealership Social Media Policy With Teeth

Best Practices For Building Your Brand While Staying Out of Court

This presentation is for informational and educational purposes only and is not legal advice. Knowledgeable legal counsel should be consulted to assist in the development of your company’s social media policies.

Why it doesn’t matter whether you allow social media use at work or not – you’re still at risk. Why your social media policy should involve everyone in the organization. Why it’s important to understand potential risks before you create your policy. How social media training can improve your ROI and protect your bottom line. How to get started creating your policy.

1. Build your brand and reputation Clear guidelines help employees understand

ways they can use social media to help achieve your business goals.

Employees can’t follow the rules if they don’t know them. An effective social media policy is a mix of guidelines for effective use of social media and rules for acceptable and unacceptable content.

2. Protect the dealership from legal challenges and reputation damage

Provide employees with clear guidelines for any work-related postings, both on company and personal sites.

Educate employees about how misuse of social media can potentially create legal liability for both the company and themselves.

Per FTC guidelines, training employees to comply with the law may limit potential liability and will be considered in any prosecution.

When a job candidate is the subject of a social media search there’s a possibility that the search will reveal information that would be off limits on a job application or interview interview, such as age, race, religion, disability, or other protected characteristics.

Access to this type of information may open the door to a discrimination claim.

If social media or the Internet is used, it should be done on all applicants, not only on applicants of a certain race or gender.

If all applicants are searched, the same information cannot be used differently against one particular type of applicants. 

Applicants should not be rejected or employees terminated based on conduct protected by lawful off-duty conduct laws. Many states have “Lifestyle Discrimination Laws” that prohibit discrimination based on such factors as tobacco or alcohol use, sexual orientation, or political affiliation.

Applicants should not be rejected or employees terminated because of their political activities as this may violate state constitutional law.

A potential employee will have a tough time asserting this claim because you need a “reasonable expectation of privacy” and a lot of people keep their social media profiles open to the public. However, it’s clear that if the applicant is using the highest privacy settings and the employer somehow gets past all these barriers, the claim is stronger.

A point to consider is how the hiring manager obtains access to the candidate's page. Many social media users have some degree of privacy established in their settings. As a result, access to the candidate's page may require "friending" the applicant and the applicant accepting the request. This should be avoided.

1. Don’t allow hiring manager to use social media in hiring decisions. But…the information regarding applicants may be a great way to vet their ability to "fit in" with a company.

2. Have someone other than a hiring manager or decision maker in human resources conduct an online background check of job applicants.

3. Use an outside agency to screen applicants – Must follow the federal Fair Credit Reporting Act and applicable state law on background checks. The applicant must be informed of the investigation, given an opportunity to consent, and notified if the report is used to make an adverse decision.

4. Allow hiring manager to use social media, but proceed carefully…

Conduct social media searches on applicants consistently and in a uniform manner.

Make sure that candidates are notified, in writing, about the company’s use of social media to gather information, e.g., on job applications.

Don’t allow factors to be considered that have no relevancy to job performance, such as race, age, or sexual orientation. 

Indentify legitimate, nondiscriminatory reasons for the hiring decision with the documentation supporting the decision.

Prohibit “friending” a potential employee to learn things about them that the general public doesn’t have access to.

Allowing or encouraging employees to contribute to dealer-hosted social media outside of regular work schedules may lead to overtime claims for non-exempt employees. Your social media policy should reiterate company policies regarding overtime, such as that permission is required or that after-hours participation in company-related social media is not encouraged or condoned and would be the result of the employees’ own choice and on their own free time.

Employers may face liability when employees use social media to make discriminatory statements, racial slurs, or sexual innuendos directed at co-workers. For example, a worker could file a sexual-harassment suit after a manager repeatedly tries to "friend“ her on Facebook.

Employers could also face liability for defamation when employees use social media to disseminate rumors, gossip, or offensive false statements about others.

Defamatory statements regarding the company, its employees, customers, competitors, or vendors should be prohibited, but…

The National Labor Relations Board recently issued a complaint against a Chicago dealership for firing a salesman over a derogatory Facebook posting. While employers can generally terminate employees for making defamatory statements about their employers, there’s a fine line between defamation and simply complaining.  Employees have the right to engage in “protected concerted activity” and to discuss the terms and conditions of employment with co-workers and leaders without retribution from their employers. This includes the right to discuss wages, benefits, working hours and working conditions, and may also include the right to complain about supervisors and ownership in some cases.

Concerted activity must be engaged in with other employees, and not solely by and on behalf of the employee himself.

In general, the NLRB has outlined four preconditions for an employee’s use of social media to qualify as protected concerted activity. The social media use must: (1) Involve the terms and conditions of employment.(2) Act as a logical “outgrowth” of some earlier discussion

among coworkers about those terms and conditions.(3) Be directed to or involve coworkers.(4) Intend to invite or induce coworkers’ further action.

The NLRB has indicated that overly broad social media policies will not survive Board scrutiny. Employers stand a better chance with “narrowly tailored” policies that limit employees from making disparaging comments about the company, an employee’s superiors or coworkers, or the company’s clients and/or competitors; or using language or taking other generally offensive actions, provided that the policies also contain language informing that such provisions do not apply to “protected concerted activity” as defined by the National Labor Relations Act.

Employees may reveal, either inadvertently or intentionally, proprietary or confidential information on a blog or social networking site. Dissemination of proprietary and confidential company information should be prohibited.

Employees must be conscientious regarding any Personally Identifiable Information (PII) that is collected. This information must be protected in accordance with the company’s Information Safeguards and Privacy policies.

Employees should not claim authorship of something that is not theirs. Any copyrighted information requires written reprint authorization before it can be posted. The use the copyrights, trademarks, publicity rights, or other rights of others without the necessary permissions of the rightsholder(s) should be prohibited.

A Dealership in Texas suffered devastating reputation damage because of the review-posting practices of a company they hired. A customer discovered that suspicious “reviewers” were writing 5-star reviews about all kinds of businesses and dealerships across the nation on the same day.

The FTC’s recently updated Endorsement and Advertising Guidelines require companies to ensure that their posts are completely accurate and not misleading, and planting or allowing fake reviews is a violation. Reviewers must never endorse a product or service that they have not used personally or create any other form of false endorsement.

The FTC recently charged a California marketing company with deceptive advertising after it found that the company’s employees were posing as ordinary consumers posting positive reviews online.

Dealers may face liability if employees use social media to comment on their employer’s services or products without disclosing the employment relationship. The FTC requires the disclosure of all “material connections” between a reviewer and the company that is being reviewed.

The NY Attorney General fined a cosmetic surgery company $300K for ordering its employees to write fake reviews and the FTC ordered a company marketing instructional DVDs to pay $250K for fake reviews posted by the company's affiliate marketers.

Companies are responsible for the actions of their staff, their vendors, and anyone else working with them to encourage social media endorsements.

Fake reviews violate the Terms of Service for Google and others and could result in being banned.

Any reviewer provided with any form of compensation such as free services, rewards, incentives, promotional items, gifts, samples, or review items, must fully disclose the source and nature of any compensation received.

Think twice about free oil changes or gas cards!

The Federal Trade Commission recently announced that it was updating its document Dot Com Disclosures: Information About Online Advertising.

If inventory is posted, prices or payments quoted, or you run contests or sweepstakes on social media it’s likely that the posts will be deemed to be advertisements and thus subject to state and federal disclosure and truth in advertising regulations.

Contests and sweepstakes are heavily regulated by both federal and state laws. Run these by your lawyer!

A good rule of thumb is to have any information that could possibly be construed as advertising reviewed by upper management or a qualified professional before it’s posted.

A U.S. District Court ruled in March 2011 that the federal CAN-SPAM Act applies beyond traditional e-mail messages, including messages sent by commercial social networking sites.

This may mean that you are required to identify the communication as an advertisement and include an opt-out of future messages.

Advertising messages to individuals (such as direct messages, messages to an individual’s social media “inbox”, or massages posted directly on a person’s wall, home pages or news feed), should be reviewed by management to ensure that the messages are CAN-SPAM compliant.

Tie in your social media policy with existing policies such as employment, anti-harassment, professional conduct, protecting trade secrets, codes of ethics or behavioral guidelines, etc. State that any policies already implemented in your workplace are similarly applicable in the context of social media.

All employees should be made aware of company policies regarding the use of social media. Just because employees may not be engaged in company-related social media as part of their job, they can easily discuss company business on personal sites or engage in inappropriate activities that put the company at risk.

Make social media training a part of your standard HR procedure.

Track employee and vendor use of social media for activity that violates your social media policy.

Require disclosure and truthfulness from anyone who participates in your social media programs, including vendors.

Be careful who you hire. As long as your company is writing the check, you’re responsible for the agency you hired. Always make sure that your agency will comply with your social media ethics policies.

Don’t forget to leave your e-mail address so I can send you a copy of a sample Social Media Policy.

Please feel free to call or drop an me an e-mail if you ever have any questions…

Jim Radogna(858) [email protected]