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In this digital age when an employee has had a bad day at work it can be tempting for them to shout “Unfair” over a highly visible social network.  An impulsive social media outburst can have dire consequences for the reputation of both the employee and the employer.

Even when an employee isn’t disgruntled, social media can cause loss.  For example, an unauthorised announcement or opinion piece by an employee could be damaging, or a business may lose clients due to LinkedIn notifications that advise when an employee has moved to a new company.

An employee who causes their employer damage misusing social media will more than likely lose their job – however in some circumstances they may also be liable for financial losses their employer incurs as a result of their actions.

Playing fair and seeking good legal advice can assist all involved to minimise the risks of a social media hijack.

Expected and Rejected Online Activities

Employees often complain about their workplaces to their friends.  However, posting opinions online has the potential to do damage that cannot easily be undone. Facebook, LinkedIn, Twitter etc.. are open networks where information can be easily accessed, promoted and spread in seconds to thousands (even millions) of people. It isn’t hard to see that unauthorised posts by employees about any aspect of their work have the potential to do real damage to an employer’s business.


A clear social media policy is an important risk management tool for employers.  Employees should be aware of exactly what online activities are expected and permissible.  Courts and Tribunals have been clear that employers are reasonable to expect their employees will not cause their business damage using social media even where their activities are undertaken outside of work hours.  The policy should:

– state what (if any) business development activities are expected and allowed using social networks, and

– outline any procedure to be followed when posting information about or on behalf of the employer,

– consider appropriate online communications with other employees who could feel harassed or bullied by their colleagues’ use of social media, and

– require the employee not to post any derogatory or damaging comments about their workplace, colleagues, clients or customers

Discipline and Dismissal

If an employee breaches a social media policy normal disciplinary procedures should be followed.  These should include notifying the employee of the concerns held, providing an opportunity for the employee to explain their actions and (if necessary) offering a support person to be present where termination of employment is a possibility.  It is also important that any social media policy is monitored and enforced.  An employer may be considered to be acting in a discriminatory manner if some but not other employees are disciplined for similar online activities.
Even in the absence of a social media policy employees are expected to refrain from deliberately or recklessly damaging their employer’s business.  All employment contracts have an implied term to act in good faith.  This term applies to the employee and the employer equally.  If an employee posts information or comments online with the intent of causing harm to their employer’s reputation they will have breached their contract of employment in a way that could warrant immediate dismissal.

Claiming Damages from Employees

Generally, employees cannot be held liable for negligence or carelessness that causes their employer loss. Similarly, a breach of a policy is unlikely to be sufficient for an employer to successfully make out a claim for damages against an employee.  However, where an employee has deliberately breached an explicit term of their employment contract and losses result the employee could be held personally liable.
Court action can be taken even where the employee had already resigned or been terminated when they posted damaging information on social networks. An employer may rely on clauses in the employment contract that survive termination (such as confidentiality or restraint of trade) to prove a breach of contract.  The implied term of good faith may also survive beyond the period of employment.
Senior employees have a greater potential to do damage to their employer, and will be more readily held to account for breaches of their employment contract.  Courts recognise that senior executives receive high remuneration for their services to an employer and are intrinsically involved in maintaining their employer’s reputation.  Employers will find it easier to enforce contractual limitations on the online activities of senior employees – both during their employment and for a reasonable period after it ends.


Tips for Employers 

– Publish a clear social media policy for your employees to follow.

– Enforce disciplinary action where social media is misused – a policy that is not enforced loses currency and clout.
– Include explicit terms in employment contracts regarding the use of social media and any expectations that extendbeyond the period of employment.
– Where an employee is being terminated or resigning consider whether a Deed of Release can be negotiated, and if so include:
– requirements for mutual non-disparagement,
– specific restraints of trade, and
– agreement in relation to what announcements regarding their departure from the company can be made on social media and when.


 If you would like further information in relation to this matter or other legal matters please contact our office on Freecall 1800 609 945 or email us now.

*This information serves as a general guide and does not constitute legal advice. It is based on our research and experience at the time of publication. Please consult our knowledgeable Legal Team for any specific inquiries or advice relevant to your circumstances, as the content may not have been updated subsequently.