Social networking websites such as LinkedIn, Facebook, MySpace, and Twitter are making it easy for your opinions to reach thousands of people in a matter of minutes. And this ease of communication can be a headache for your legal department.

Online commentators, from bloggers to your neighbor, are increasingly getting sued or threatened with legal action for everything from defamation to copyright infringement. Take for example the woman sued last year by her apartment's management company when she tweeted that the apartment had mold... and that the management company was 'ok' with it. The management company filed a libel suit the very next day - asking for $50,000 in damages.

Luckily for the renter, since her tweet didn't specify where the company was located or point directly to the company, it didn't meet all of the elements to prove a libel. The other requirements include: that the statement be published (which it was) and proof of actual harm from the comment, such as damage to reputation or negative financial effects. The judge ended up dismissing the case in January, on the grounds that the tweet itself was too vague to fit the required legal elements.

The moral of the story - be careful of what you type. But, what about what your employees are typing? Do you know what your employees are tweeting, blogging, or posting? Does your organization have a social media policy? Probably not.

A report by Manpower employer services found that only 29 percent of companies in the Americas have a "formal policy regarding employee use of social networking sites." The number is lower in other regions - 25 percent in Asia-Pacific; the worldwide number is 20 percent.

Is it really necessary? What if you block sites such as Facebook and MySpace on your corporate server? Keep in mind, social media and online commentary happens at nearly every site, from news article comment boxes to search engine user groups forums. So even if your employees aren't managing a LinkedIn group or a Twitter account, a formal policy should be put in place to make sure an employee doesn't say anything publicly that could damage your company's reputation.

Developing a Social Media Policy
There are legitimate reasons to establish guidelines for social media. Here are some points to consider when developing your social media policy.

• Extend existing policies. Your organization probably already has an existing communications or ethics policy - one that says you won't say anything bad about the company. Social media is merely an extension of what you currently have in place. But, it needs to be added and communicated.
• Negative comments lead to consequences. Your policies on ethics, NDAs, and company loyalty extend to all forms of communication (including social media) both inside and outside the workplace. People need to remember that negative comments about their company, boss, products, etc. online can lead to consequences at work.
• Formalities, please. All too often companies assume that common sense should be all that is needed, but formal policies can drive effective practices. That means developing guidelines for its use, training people to leverage the benefits, and proactively creating a positive social media presence for the organization.
• Document, inform, and train. There is a learning curve associated with social media. Further, many people believe that what they say on their own personal blog or page is their own opinion, no matter what the opinion. You need to be upfront with employees that they have no right to privacy with respect to social networking and you reserve the right to monitor employee use of social media - even if that use is done at home after work hours. It's important to document your policies and behavior, reinforcing that these behaviors extend to online forums, and then educate the employees on proper engagement. Create internal guidelines that can be used to train future employees.
• Consult an expert. It may be time to dust off the employee handbook/contracts and consult your attorney. If an employee sends a public message that in some way violates an existing contract (e.g. NDA-protected content), in some cases the company, not the employee, may be the responsible party.
• Protect your wallet. According to the Citizen Media Law Project, U.S. lawsuits over online postings jumped 70 percent in 2008 from 2006. Most web-related lawsuits center on claims of defamation or copyright infringement. If you have a blog that earns money, media liability insurance is an option. Or, if you're tweeting for your personal pleasure and get hit with a suit, as in the previously mentioned mold tweet, it may be covered under your homeowners insurance. Wherever you're posting, check with your insurance provider to see if social media commentary is covered.

Getting started
The Social Media Business Council has a Disclosure Best Practices Toolkit, which is a series of checklists to help companies, their employees, and their agencies learn the appropriate and transparent ways to interact online. It's available for free and in three languages: English, French, and Chinese Simplified.

Also, several large organizations have their social media/Internet usage policies posted online. Cisco has even granted permission for others to use their Internet Postings Policy.

Sources
Mashable
Manpower
Social Media Business Council
Citizen Media Law Project