In brief

  • The emergence of social networking sites and other Web 2.0 applications has fundamentally changed the modes by which we interact with others. Their use in the workplace has the potential to dramatically alter the way in which organisations protect their brand, recruit and manage employees, and approach effective risk management.
  • A recent unfair dismissal claim before Fair Work Australia confirmed that postings on social networking sites by individuals to express displeasure with an employer or co-worker can impact the employment relationship of trust and confidence.
  • Employers should be taking action to effectively manage the risks and maximise the benefits of the use of Web 2.0 by employees and human resources personnel alike.
  • The risks include impact on productivity of employees; equal opportunity and bullying; breach of intellectual property and confidential information rights; vicarious liability for defamation; misrepresentation or misleading conduct and brand damage.
  • At the same time there are opportunities for employers to add value by harnessing these technologies to communicate with consumers and staff.
  • Employers need to determine their strategy, update their policies and consider educating staff about appropriate use of these new tools.  

The emergence of social networking sites (SNSs) and other Web 2.0 applications has fundamentally changed the modes by which we interact with others. Their use in the workplace has the potential to dramatically alter the way in which organisations protect their brand, recruit and manage employees, and approach effective risk management.

The decision of Fair Work Australia on 24 September 2010 confirms that out of work conduct such as posting critical comments about an employer on a website such as Facebook may affect the employment relationship of trust and confidence. However in the case of Fitzgerald v Smith T/A Escape Hair Design, Commissioner Bissett found that while the comments were silly they did not provide a valid reason for dismissal because the postings were not detrimental to the business and the employer had not raised the comments with the employee at the time they were made.

This decision reminds employers that they should be taking action to effectively manage the risks while maximising the benefits of the use of Web 2.0 by employees and human resources personnel alike.

What do we mean by Web 2.0 applications?

In basic terms, the most relevant Web 2.0 applications to the workplace fall into two main categories:

  • social networking sites (such as MySpace, Facebook and LinkedIn) that allow users to build online profiles and share content with other profiles to which they choose to be linked, and
  • content sharing sites (such as YouTube, Flickr, wikis and blogs) that host and distribute user-created or user-uploaded multimedia content.

Pre-employment issues

At the pre-employment stage, Web 2.0 applications are becoming an increasingly important element of the employer’s due diligence process. Web 2.0 applications can be used as a cross-referencing tool when checking an applicant’s CV, and may be equally relevant to screening in and screening out applicants. While these applications may provide HR professionals with valuable information, there are a number of potential risks associated with their use as a screening tool. For example, copies of job candidate searches that are retained may be protected under privacy legislation. Unsuccessful candidates may claim discrimination where irrelevant personal information is published on a social networking site. Similarly, an applicant may have published information about a prior complaint against an employer, their role as a bargaining representative or other ‘workplace right’ attracting protection under the Fair Work Act 2009 (Cth).

Issues during employment

Broadly speaking, the issues posed by SNSs during the employment relationship reflect those relevant in the physical workplace. These include productivity impact; equal opportunity and bullying; breach of intellectual property and confidential information rights; vicarious liability for defamation; misrepresentation or misleading conduct and brand damage.

However, the immediacy and tremendous reach of SNSs cast these familiar issues in a different light. While an email containing confidential information or a questionable photo may have previously been circulated amongst a limited group of individuals, the same information posted on Twitter or photo posted on Facebook would have the potential to instantaneously reach an audience of millions.

Termination issues

Termination issues surrounding Web 2.0 use similarly reflect issues that traditionally give rise to termination rights. A key difference in the Web 2.0 context, however, is the extent to which these applications bring into question conduct traditionally considered to be ‘off duty’. Negative comments on Web 2.0 sites or photos of employees displaying questionable conduct outside of work hours may give rise to misconduct issues.

In Fitzgerald v Smith T/A Escape Hair Design¸ the Commissioner held that Facebook comments may impact the employment relationship, even if posted out of work hours. She said ‘It would be foolish of employees to think they may say as they wish on their Facebook page with total immunity from any consequence.’ In this case, Fitzgerald posted a comment that read:

Xmas ‘bonus’ alongside a job warning, followed by no holiday pay!! Whoooooo! The Hairdressing Industry rocks man!!! AWSOME!!! [sic]

The Commissioner considered a range of factors, including:

  • whether the employer was named (it was not)
  • who could see the comments (including 5–10 clients who were her ‘friends’)
  • how long the comments were posted (two weeks)
  • whether the comments would adversely affect the hairdressing industry or the employer’s business specifically (not likely), and
  • whether the employer raised her concerns about the comments at the time (she did not).

In this case, if the employer had had a clear policy about appropriate use of social networking tools and acted promptly when she became aware of inappropriate comments, the employer’s position would have been different.

So what can we do to manage the risk?

Put simply, employers should develop their strategy recognising that the risk and benefits of Web 2.0 are likely to involve compromise. There are opportunities for employers to add value by harnessing these technologies to communicate with consumers and staff. For example, Telstra, IBM and Intel have used a range of Web 2.0 applications for internal and external communications, conducting meetings, knowledge sharing and complaint resolution. Balanced against the good news stories, of course, are the range of risk management issues outlined above that organisations will need to address in deciding whether the use of Web 2.0 applications fits within their business.

While you may have already developed a comprehensive approach to the use of information technology, the sheer speed of its development is likely to mean that your existing policies do not adequately address the specific issues raised by Web 2.0 applications.

With that in mind, your organisation should consider:

  • developing specific policies to address Web 2.0 issues and educating staff on what this means to them
  • updating current policies, contracts and training – these may include information systems, equal opportunity, occupational health and safety, confidential information, conflict of interest and security policies, and
  • implementing software to monitor or limit excessive or objectionable use.

Regardless of whether you or your organisation use Web 2.0 applications, your employees, clients and competition are likely to be using them. Your organisation will need to reach a view on Web 2.0 use, but no matter where you land, you need to be prepared.