Protecting Client Relationships in the Social Media Era

How can you harness the power of social media to grow your business without putting your valuable client base at risk?

Any good business knows that its knowledge of and connection to its clients is its most important asset.  Significant effort is put into developing those relationships, and keeping regular contact with key people.  Social media is a powerful way to advance this, and modern businesses use social media platforms to stay connected with current clients and grow connections.  Employees’ social media connections are key to business retention and development, and many businesses now actively encourage employees to maintain a social media profile, linking with clients and potential clients. 

However, because business connections are valuable, many of those same employers also seek to limit employees’ communications with clients when the employment relationship ends, restraining employees’ post-termination contact with non-compete, non-solicitation and sometimes even non-contact provisions.  The business purpose of these provisions is clear (and sanctioned by the law) – to prevent the now ex-employee from taking advantage of knowledge developed in the course of the relationship with the employer to divert the client’s custom. 

So, the restrained employee leaves his or her employment, and updates their LinkedIn profile, proclaiming their exciting new position at the local competitor.  What happens then?

This is a classic case of practice failing to keep up with reality.  Many business adopt new technology in an ad-hoc manner, seeking to garner all the advantages it offers, but failing to foresee the pitfalls.  There are a number of possible responses, but they must be considered before the employment relationship ends.  Here are some options:

- Do not allow employees to refer to the employer on any personal social media forum.  This approach keeps the employer in control of its social media profile, but prevents it from taking advantage of what the employee’s connections might bring.

- Have the employee develop a social media profile for the purpose of their employment with the employer only.  This profile remains the property of the employer when they depart.

- Have an agreed protocol for announcing job changes by employees, that occurs with the employer’s knowledge prior to the employee’s departure.

- Have well considered restraints of trade that address matters outside of those affected by social media – for example, a non-solicitation provision may be hard to enforce, but a well worded non-competition provision (and in this regard, I favour prescriptive wording), would be sufficient to prevent an employee from working with a client, even if that client knows where they are. 

In all circumstances, restraints of trade must meet a number of criteria to be enforceable – they must protect a legitimate business interest, and go no further than is reasonable to protect that interest.  They are usually limited by both geography and time.  Restraints that are unreasonable will be unenforceable. 

If you need to review your social media policy or practice, or if you need to consider the nature of your restraints for the modern era, please do not hesitate to call me.