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October 26, 2012

When dismissal for Facebook comments is unfair

In Linfox Australia Pty Ltd v Glen Stutsel [2012] FWAFB 7097 Fair Work Australia dismissed an appeal by Linfox against a Commissioner's decision that its employee had been unfairly dismissed by the Company, and ordering that he be reinstated in his employment and compensated for part of his lost wages.

The truck driver's employment was terminated for serious misconduct following the posting of comments about two of his managers on his Facebook profile page.

The inconsistency of the company's approach to Facebook use by employees and the lack of a social media policy was found relevant.

The comments posted on the employee’s Facebook page regarding the managers were offensive, derogatory and discriminatory, and included suggestions of dishonest and underhanded conduct, and comments of sexual misconduct.

The Group Manager for Workplace Relations concluded that the employee’s conduct on Facebook amounted to sexual and racial discrimination, which breached Company policies relating to equal opportunity and diversity.

The Commissioner took into account a range of “other matters” in concluding that the dismissal was harsh, unjust and unreasonable. These included the differential treatment by the Company of the other employees who made comments on the Applicant’s Facebook page. In this regard the Commissioner noted that none of the other employees who made offensive comments on the Facebook page were the subject of any sanction by the Company. The Commissioner also took into account the employee’s limited understanding of the employee as to the privacy of Facebook communications and his “extremely good employment record over some 22 years, his age and his employment prospects”.

In dismissing the appeal Fair Work Australia said:

"The posting of derogatory, offensive and discriminatory statements or comments about managers or other employees on Facebook might provide a valid reason for termination of employment. In each case, the enquiry will be as to the nature of the comments and statements made and the width of their publication. Comments made directly to managers and other employees and given wide circulation in the workplace will be treated more seriously than if such comments are shared privately by a few workmates in a social setting. In ordinary discourse there is much discussion about what happens in our work lives and the people involved. In this regard we are mindful of the need not to impose unrealistic standards of behaviour and discourse about such matters or to ignore the realities of workplaces...

In the present case, the series of Facebook conversations in which the comments were made were described by the Commissioner as having the flavour of a conversation in a pub or cafe, although conducted in electronic form. We do not agree altogether with this characterisation of the comments. The fact that the conversations were conducted in electronic form and on Facebook gave the comments a different characteristic and a potentially wider circulation than a pub discussion. Even if the comments were only accessible by the 170 Facebook “friends” of the Applicant, this was a wide audience and one which included employees of the Company. Further the nature of Facebook (and other such electronic communication on the internet) means that the comments might easily be forwarded on to others, widening the audience for their publication. Unlike conversations in a pub or cafe, the Facebook conversations leave a permanent written record of statements and comments made by the participants, which can be read at any time into the future until they are taken down by the page owner. Employees should therefore exercise considerable care in using social networking sites in making comments or conducting conversations about their managers and fellow employees...

...In the present matter the Commissioner considered that the statements and comments made by the Applicant were distasteful. However when viewed in the context of the Facebook conversations he considered that they were not of such a nature as to warrant dismissal for serious misconduct, or even as to constitute a valid reason for termination. Some of the comments were so exaggerated or stupid as not to amount to any credible threat against the managers. Other comments were not of such a serious nature as was contended by the Company in the proceedings before the Commissioner and on appeal. Furthermore, some of the comments were not made by the Applicant but by one of his Facebook friends...

...We have carefully considered the evidence and material before the Commissioner and the submissions on appeal. We consider that the conclusion reached by the Commissioner was reasonably open to him in the circumstances of the case and having regard to the context in which the conduct occurred and an overall assessment of the gravity of the conduct. "

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Posted 26th October 2012 by David Jacobson in Web/Tech, Workplace

August 30, 2012

Responsibility for business Facebook pages

If your business has a Facebook page which promotes or publicises your products or services, you are responsible for what your employees, customers and visitors say on it as well as your own content.

Comments on a business's Facebook page are regarded by law as advertisements which are subject to the laws relating to advertising, including the prohibition on misleading or deceptive conduct.

Advertising is now a high risk element of any business: recent penalities for misleading advertising include $3.61M against Optus and $2.25M against Apple.

The Macquarie Dictionary defines advertisement as "any device or public announcement designed to attract public attention, bring in custom". The medium does not change an advertisement's purpose. You cannot distinguish social media on the basis of being a communications network rather than a traditional ad.

Recent Advertising Standards Board decisions
The Advertising Standards Board deals with complaints about advertising.

Complaints were made against the VB beer and Smirnoff Vodka Facebook pages regarding comments and material posted by Facebook users.

As a preliminary issue in both cases the Board determined that a Facebook page was an ad.

"The Board considered that the Facebook site of an advertiser is a marketing communication tool over which the advertiser has a reasonable degree of control and that the site could be considered to draw the attention of a segment of the public to a product in a manner calculated to promote or oppose directly or indirectly that product. The Board determined that the provisions of the Code apply to an advertiser's Facebook page. As a Facebook page can be used to engage with customers, the Board further considered that the Code applies to the content generated by the page creator as well as material or comments posted by users or friends. The Board noted that on this Facebook page, the user comments identified in the complaint were posted in reply to questions posed by the advertiser.

The Board also noted the advertiser response identifying the tone of the page, the demographic principally targeted by the VB brand and advertisers view of the comments posted by users. The Board further noted that the age access restrictions within Facebook itself, is designed to limit access by children to pages promoting alcohol products and other adult material."

VB Facebook page
The Board determination in respect of VB's Facebook page dealt with a complaint that material openly available on the Facebook pages of VB features:
- Sexism racism and other forms of discrimination or vilification
- Irresponsible drinking and excessive consumption
- Obscene language depiction of under-25 year olds consuming alcohol
- Material that connects alcohol consumption with sexual or social prowess

The Board determined that certain comments were in breach of the Advertiser Code of Ethics:

"The Board noted that social media is an advertising platform that requires monitoring to ensure that offensive material is removed within a reasonable timeframe and that content within a Facebook page should, like all other advertisement and marketing communication, be assessed with the Code in mind. ... The Board recognized the challenges in effectively monitoring social media to ensure that offensive material removed within a reasonable time.

The Board noted the advertiser's response which indicated that the material identified by the complainant had been removed from the Facebook page and the advertiser had implemented a more rigorous monitoring arrangement for its social media presence."

Smirnoff Vodka Facebook page
On the other hand the Board determination in respect of Smirnoff Vodka 's Facebook page considered that, whilst the Facebook page was advertising, the advertisement did not contain material that was contrary to prevailing community standards on health and safety and was not in breach of the Code.

ACCC v Allergy Pathway

In Australian Competition and Consumer Commission v Allergy Pathway Pty Ltd (No 2) [2011] FCA 74 Justice Finkelstein of the Federal Court fined Allergy Pathway Pty Ltd (formerly known as Advanced Allergy Elimination) and its director, Mr Paul Keir, $7,500 each for contempt of undertakings made to the court following a successful 2009 Australian Competition and Consumer Commission action for false, misleading and deceptive conduct.

Justice Finkelstein decided that Allergy Pathway and Mr Keir made prohibited representations about Allergy Pathway’s purported allergy treatment on its website and on Twitter, Facebook and YouTube in breach of those undertakings.

The representations included testimonials written and posted by clients on Allergy Pathway’s Facebook “wall” and testimonials written by clients and posted by Allergy Pathway on its website and Facebook and Twitter pages.

In his judgment Justice Finkelstein said: “while it cannot be said that Allergy Pathway was responsible for the initial publication of testimonials (the original publisher was the third party who posted the testimonials on Allergy Pathway’s Twitter and Facebook pages) it is appropriate to conclude that Allergy Pathway accepted responsibility for the publications when it knew of them and decided not to remove them. Hence it became the publisher of the testimonials.”

What you need to do
If you have a business Facebook page you need to monitor comments left on your Facebook page, remove offensive material and correct incorrect or misleading comments.

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Posted 30th August 2012 by David Jacobson in Marketing, Web/Tech

August 14, 2012

ASIC issues guidance on crowd funding

Fundraising by selling securities is generally regulated by the Corporations Act, depending on the nature and number of investors, the amount raised and what is being offered by the promoter.

ASIC has been monitoring increasing use of "crowd funding" for investment purposes to identify any arrangements, or aspects of those arrangements, that may be regulated by ASIC.

‘Crowd funding’ involves the use of the internet and social media to raise funds in support of a specific project or business idea. Project sponsors or pledgers typically receive some reward in return for their funds. In some cases, the reward expected may be of minor value and is merely incidental rather that the purposes of the contribution.

ASIC has issued guidance to promoters of ‘crowd funding’ to clarify arrangements which may be regulated by ASIC under the Corporations Act 2001 and the Australian Securities and Investments Commission Act 2001.

ASIC has also highlighted some risks for operators of crowd funding websites and people considering participating in crowd funding projects.

ASIC's view is that some types of crowd funding could involve offering or advertising a financial product, providing a financial service or fundraising through securities requiring a complying disclosure document.

Depending on the type of ‘reward’ offered by the project creator to those giving funding, crowd funding could involve a managed investment scheme under Chapter 5C of the Corporations Act, provision of a financial services requiring an Australian financial services (AFS) licence or a fundraising under Chapter 6D of the Corporations Act.

There are also advertising and publicity restrictions that apply to advertising and publicising an offer of financial products or securities, in certain circumstances.

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Posted 14th August 2012 by David Jacobson in Corporations Act, Financial Services, Web/Tech

June 27, 2012

New bank account switching rules: changes to EFT Code

Changes implemented by the Australian Payments Clearing Association (APCA) effective from 1 July 2012 will enable consumers to approach their new financial institution to commence a switch of their direct credits and debits from their old to their new financial institution through a 'single signature' (as recommended by the Final Report of the Fraser Review on Account Portability, entitled Banking services: cost-effective switching arrangements delivered in August 2011).

The previous institution is obliged to provide a list of the customer's regular direct debits or credits made from/to their old transaction account in the past 13 months.

ASIC has released new guidelines to support the reforms.

ASIC has updated both the Electronic Funds Transfer Code (EFT) and the new ePayments Code which will succeed the EFT Code from 20 March 2013.

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Posted 27th June 2012 by David Jacobson in Financial Services, Web/Tech

June 12, 2012

Knowledge management: legislative processes

When the Attorney-General's Department failed to proclaim amendments to the Family Law Act in the way prescribed, the legality of family financial settlements was affected. It also raised the question as to whether the current systems adopted by the the Department were adequate.

The report of the Review of Legislative Practices and Processes in the Attorney-General’s Department has now been released and makes interesting reading.

In response the government has agreed that the Department will develop and adopt a Departmental-wide project management approach for the development, passage, commencement and amendment of legislation. It will also develop an enhanced Knowledge Management system for legislation.

What arrangements do you have in place to monitor regulatory change as well as your internal systems and procedures?

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Posted 12th June 2012 by David Jacobson in Business Planning, Compliance, Web/Tech

September 21, 2011

ePayments Code released

ASIC has released the new ePayments Code which replaces the existing Electronic Funds Transfer Code of Conduct (EFT Code) and will regulate consumer electronic payments including ATM, EFTPOS, debit and credit card transactions (including contactless transactions), online payments, internet banking and BPAY.

UPDATE: The following corrections to the Code were issued on 20 October 2011:
Clause 2.1 - deleted the words 'by a consumer' in line one;
Clause 2.6 - in the definition of the term 'low value facility', deleted the words 'stored value or reloadable'.

Existing subscribers have an 18 month transition period to move to the new Code. The transition period has started and subscribers must comply with the new Code by 20 March 2013.

The ePayments Code:

  • requires subscribers to give consumers terms and conditions,
  • information about changes to terms and conditions (such as fee increases), receipts and statements,
  • sets out the rules for determining who pays for fraudulent and unauthorised transactions, and
  • establishes a regime for recovering mistaken internet payments.

ASIC will be responsible for the administration of the ePaymentsCode, including monitoring compliance and reviewing it regularly.

Background
Mistaken electronic payments

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Posted 21st September 2011 by David Jacobson in Financial Services, Web/Tech

July 18, 2011

Cybercrime legislation

The Attorney-General has introduced the Cybercrime Legislation Amendment Bill 2011 into Parliament.

The Bill has been referred to the Joint Select Committee on Cyber-Safety for inquiry and reporting.

The Bill sets the legislative framework to enable Australia’s accession to the Council of Europe Convention on Cybercrime – the only binding international treaty on cybercrime.

The Convention provides systems to facilitate international co-operation between signatory countries, as well as establishing procedures to make investigations more efficient, including:

  • empowering authorities to request the preservation of specific communications (with access subject to a warrant in Australia);
  • helping authorities from one country to collect data in another country;
  • establishing a 24/7 network to provide immediate help to investigators; and
  • facilitating the exchange of information between countries.

The Bill makes three key changes to existing laws:

  • Preservation – enabling agencies to request the preservation of communications by a carrier that they intend to seek a warrant over;
  • International Cooperation – providing Australian agencies with greater access to information stored overseas in the investigation of cybercrime and crimes committed using the internet; and
  • Cybercrime Offences – extending the scope of existing Commonwealth computer offences to fully meet the requirements for such offences under the Convention.

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Posted 18th July 2011 by David Jacobson in Web/Tech

June 8, 2011

Using Facebook for business promotions

Using social media sites, such as Facebook, for competitions adds another layer of rules that promoters need to understand.

Facebook has its own Promotions Guidelines (last revised 11 May 2011) setting out how Facebook functionality may be used in competitions (whether involving skill or chance).

For example, the use of Facebook functionality requiring a "like" as registration for competition entry or as a voting mechanism is a contravention of the Facebook Promotions Guidelines.

Whilst promoters can use liking a Page as a competition precondition, conditioning registration or entry upon the user liking a Wall post, or commenting or uploading a photo on a Wall is not permitted. There has to be a separate entry into a competition.

Business (or trade) promotions are designed to encourage consumers to visit a site or buy or raise awareness of a particular product or service. If winners are determined wholly or partly by chance (as opposed to skill) the competition is also subject to the various states’ lotteries or art unions laws. In some states permits are required.

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Posted 8th June 2011 by David Jacobson in Marketing, Web/Tech

June 6, 2011

Austlii iphone app

AustLII has released a free iPhone app which enables users to browse legislation from the Commonwealth and from every Australian State and Territory, and cases from over 140 courts, tribunals and boards.

AustLII for iOS resizes content from the AustLII website to fit the exact dimensions of your device’s screen. And when you’ve found what you’re looking for, you can email it to anyone right from within the App.

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Posted 6th June 2011 by David Jacobson in Web/Tech

May 31, 2011

Electronic transactions: online contracts update

The Commonwealth Electronic Transactions Act has been in place since 1999. Its objective was to make the law relating to contracts technologically neutral.

The Electronic Transactions Amendment Act 2011 received Royal Assent on 25 May 2011 and addresses important practical issues to reflect internationally recognised legal standards on e-commerce and to enable Australia to accede to the UN Convention on the Use of Electronic Communications in International Contracts 2005. The amendments take effect from 24 June 2011.

Partner David Jacobson and Lawyer Claire Endean look at the law relating to online contracts following the passing of the Amendment Act. Download PDF article.

UPDATE: Download a consolidated Act from ComLaw.

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Posted 31st May 2011 by David Jacobson in Business Planning, Financial Services, Web/Tech
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