Charles Urquhart Partner at Clyde & Co LLP
In January 2015, it was estimated that 59% of the UK population had active social media accounts*. We know that people use social media to express their personal thoughts and opinions about everything, from the recent performance of the England cricket team, to the impact of tube strikes, or in some instances, how they feel they are being treated in their workplace.
As a provider of employee screening services, we are regularly asked whether we conduct searches of social media as part of our suite of checks. The answer is invariably no. We believe that employee screening must be balanced and fair. It cannot cross the boundary of prying into someone’s private views.
Whilst we continue to monitor the development of social media from a screening perspective, we noted some changes in the way that employers are addressing employee use of social media in the workplace.
Most companies will add a relevant section to their company Staff Handbook or Code of Conduct, and trust employees to comply. However, many more employers are now seeking to strengthen their employment contracts. In particular, they are introducing a clause covering employee use of social media sites such as LinkedIn.
In the old days, a company’s client list would have been held on a Rolodex. These days it is more likely to exist in a CRM. The removal or copying of data from either was usually covered by contractual confidentiality clauses. However, more and more people are likely to use LinkedIn to connect to new and existing client contacts, thereby making the taking of client contacts from one employer to the next much easier.
To obtain a legal perspective, we asked Charles Urquhart, a Partner specialising in employment law at Clyde & Co, to provide his opinion. Here is what he said:
Protecting your business connections: time to LinkOut?
With over 300 million registered members worldwide, and over 18 million in the UK alone, LinkedIn is the world's largest internet based professional social network.
Many employers in the UK actively encourage their employees to join and to use both this and other professional networking sites during the course of their employment so as to foster business relationships. However, the use of such sites can also create issues for employers when an employee leaves their employment. How? Because they provide an alternative (and easier) way for employees to take business contacts with them, to compete with their employer and to solicit or deal with their clients when they leave.
Employees may, for example, use networking sites such as LinkedIn to inform clients both that they are leaving their current employer and of the identity of their prospective employer. This can be done simply by updating one's LinkedIn profile or by creating a group using the employee's new contact details. Furthermore, a departing employee will be able to argue that they were obliged to change their LinkedIn profile otherwise they would be holding themselves out as still employed by their original employer.
Employers have long dealt with post termination competition by way of restrictive covenants. However, the law has not kept pace with the use of professional networking sites and it remains unclear whether the wording of restrictive covenants, that do not expressly cover professional networking sites, would prohibit this mischief. For example, if a claim was brought there could be debate over whether:
LinkedIn contacts are "company property". It could be argued that business contacts made by employees in the course of their employment are no different to business cards or Rolodexes: i.e. the property of the employer. Much may depend, however, on the circumstances in which the account was set up – for example did the employee set up the account prior to joining the employer or, alternatively, has the employer invested in a premium LinkedIn account for the employee's use?
business contacts posted publicly on LinkedIn amount to "confidential information". If not, employees could arguably continue to use this information when their employment terminates; and
changes to a LinkedIn profile, and the automatic update which the employee knows that LinkedIn will generate, amounts to 'solicitation' of clients.
So what can employers do to ensure their business interests are properly protected in the face of this social media revolution? The solution is to bolster employment contracts to expressly cater for professional networking sites. Additional provisions could include:
stating that any proprietary interest in business contacts added to LinkedIn in the course of employment is assigned to the employer and that such business contacts constitute "confidential information";
requiring employees to delete those business contacts formed in the context of their employment from LinkedIn immediately on termination and prohibiting them from reconnecting with (soliciting) those business contacts for a given period following termination (the same period as the client solicitation covenant).
The question is whether this will work? The courts have yet to consider these issues so the answer is we don't yet know whether such clauses will be legally enforceable. In addition, employers may also face practical difficulties in enforcing these types of provision - for example, what if an employee refuses to delete contacts? If you then fire the employee that may play into their hands as they will be free/or they will argue they are free to compete.
In addition, what position will LinkedIn itself take? If these issues were ever litigated they may wish to intervene in a manner that could be unhelpful to employers.
Notwithstanding these difficulties, the most prudent course is for employers to update their contracts of employment to include these clauses so as to (i) provide a deterrent to employees soliciting business through LinkedIn; and (ii) to place themselves in a better position to argue that contacts made during the course of employment, and recorded on LinkedIn and other networking sites, belong to the employer.
It will however remain to be seen whether the law supports employers in forcing employees to "link out" with their business contacts on exit.
For further information please contact us
By Michael Whittington
Head of Employee Screening