Articles from the Silver Shemmings Ash Team on contractual matters, recent case law changes and items of interest in the construction and property world

Who Wins In The Social Media War?

December 10, 2018 | Silver Shemmings

Have you ever wondered why your contract of employment contains a social media clause? Jon Sharp explains…

I first started work on the 18th August 1986. I was employed under a strange thing called Articles of Clerkship, which was executed as a deed between my employer and myself. Shortly, it said that in exchange for training and pay, I would work for my employer for two years. At the end of that two year period, my employer had the option to either keep me on or cast me aside to make my own way in the profession. I don’t believe that Deed of Articles was more than six pages long.

My employer though did decide that I was worth employing at the end of the two year term, and I then received a contract of employment. I still have it to this day, it is a mere eight pages long.

Of course, now, contracts of employment are considerably longer, twenty to twenty five pages being not uncommon, and most incorporate the firm’s policies on various issues which are available on the employer’s website, and the office manual. In totality therefore, by the time the policies and office manual are attached, the reality is that contracts are easily over two hundred pages long.
In about 2000, I opened a LinkedIn account. This was a novelty – you could add business connections and communicate useful information to them. Personally, I never thought it would really take off, but it just shows how wrong you can be. By 2010 I had maybe two hundred people in my network, now I have over a thousand but even that is on the small side. People now have many thousands of connections – there is no doubt that LinkedIn plays a significant role in business. It also contains a search facility – so if you want to find a list of builders who specialise say in cladding of buildings, you can search LinkedIn and you will obtain a list of such builders. Importantly though, a corporate entity cannot have a LinkedIn account, LinkedIn supports individual accounts only. You can add a link to your business or company – but corporate accounts are not supported.

Facebook operates on much the same lines, but in a social context. Again, it has a search facility but only supports individual accounts.

With the increased importance of LinkedIn in particular, which is often supported by employers either by encouraging employees to use LinkedIn to promote the business, or as a necessary part of the business (for example the recruitment industry) employers often pay for the use of the LinkedIn premium account.

The question has arisen though in respect of usage of Facebook and LinkedIn accounts by individuals whilst employed, in terms of ownership of an individual’s account and the use it can be put to.
Now, a clause in a contract of employment saying that you must not use your social media accounts to denigrate the business that you work for is something that most people would agree with. If you have no security settings on your Facebook account, so that 5 billion people around the world can see your posts, and you say who you work for, posting a message saying “The company I work for is the worst I have ever worked for, my boss is a complete dictator, the managing director a pompous incompetent idiot, and I would strongly suggest that nobody ever works for them” clearly is not acceptable and the employer reserves the right to take action in those circumstances – fair enough so far.

But what about ownership?

The leading case is Nautech Services -V- CSS Limited [2014] 1 JLR 361. Whilst this is a Jersey case, the English courts have long since referred to decided cases in other jurisdictions with similar legal systems to this jurisdiction for guidance on new areas of law or where unusual facts arise. There is the only obiter (off the record if you like) comment in this jurisdiction on the question of ownership of LinkedIn and Facebook accounts.

Nautech Services Limited (Nautech) was a company engaged in the provision of specialist employees to shipping companies who provide seismic survey services to the oil and gas industries across the world. In April 2013, Nautech obtained interim injunctions against three of its former employees, their new employer, CSS Limited and it’s Managing Director, to prevent the use of confidential information and/or trade secrets which Nautech alleged had been taken from them. Included in the definition of information was data held on Facebook and LinkedIn accounts which Nautech alleged it “owned”.

The interim injunctions were amended, so that the three former employees, CSS and its managing partner, were prohibited “from infringing [Nautech’s] copyright in any of [Nautech’s] confidential information and/ or trade secrets or any part thereof for any purpose …” by order of the Royal Court on 7 May 2013. This included Facebook and LinkedIn accounts in the names of Nautech’s former employees.

It was held that Nautech’s contact database was at the very heart of its business operations, in the absence of any public database of suitably qualified contractors for the global oil and gas industry. CSS’s arguments that the contact information of potential clients and specialists could have easily been found from other sources, were rejected.

The Royal Court held that, pursuant to the Intellectual Property (Unregistered Rights) (Jersey) Law 2011, the database was protected by copyright. However, they refused to find that this protection extended to a LinkedIn and Facebook account, despite Nautech paying for a premium account and the account having been accessed from a Nautech email address. To this end, the Royal Court noted that the terms of a LinkedIn user agreement clearly stated that a LinkedIn account, all content and information in relation to that account belonged to the user and so held that the user agreement would stand, absent any agreement to the contrary. They held the same in relation to Facebook accounts.

So that is why you now have increasingly lengthy social media clauses.

Let’s take an example. A company hires an experienced man – say someone with twenty years’ experience, a leader in his field. He will have a LinkedIn account, with contacts and connections that he has built up over twenty years. He joins, and brings in new business to the company, adding those new business contacts to his LinkedIn account. Whose contacts are those? In addition, whilst the MD of the company is away, the MD asks him to take his clients out to dinner. He adds those to his LinkedIn account. Again, whose contacts are those? If you follow Nautech -v- CSS, they become those of the experienced man.

LinkedIn and Facebook accounts are a good example of where employers may wish to have their employees enter into an agreement in which the employee assigns to the employer all rights to his or her LinkedIn account. That though, is unlikely to be acceptable to the employee, who may well refuse.

Sensibly drafted social media clauses will confirm that a person’s LinkedIn and Facebook account is entirely theirs on the date of joining – contacts after that may be viewed by the company and company contacts should be deleted on departure – so in the example above, the MD’s dinner guests.

The grey area though will be the new business connections brought in by the experienced man whilst employed by the company, especially if the company paid for a premium LinkedIn account. Whose are those? At present, under Nautech -v- CSS, the experienced man’s.

It will only be a matter if time before this matter comes before the English courts in full – it will be an interesting decision.

Author Jonathan Sharp is a Consultant Solicitor at Silver Shemmings Ash. Jonathan has practiced in the City for close to 30 years and has a wealth of experience in the insurance industry and has a number of reported cases that demonstrate his abilities as a leader in the areas of dispute resolution, insurance, marine, aviation, general commercial matters and social media. Jonathan regularly presents seminars and lectures to the public insurers banks and other lawyers, on a range of topics, including social media

He has also conducted a number of Arbitrations, before both the LMAA and ICC and dealt with boundary disputes, defended planning applications, and property transfers after matrimonial issues. Jonathan’s cases speak for themselves – his clients trust him to deal with complex litigation in an efficient manner

At Silver Shemmings Ash, we provide seminars and training alongside our core activities in contentious and non-contentious matters. The purpose of these is to facilitate a greater knowledge and understanding of construction and property law. There remains a considerable lack of training in such areas for companies and this is an issue which we are looking to address

by Jon Sharp

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