Challenges to social media protocols by employees fired for violating them are succeeding with increasing frequency.

To mitigate the risks of costly legal proceedings and damage to company morale and reputation, financial advisory firms drafting social media policies should make sure the process is a holistic endeavor that involves human resources, marketing and legal departments.

Beware: Good intentions in creating such policies, like protecting against disclosure of confidential information, harassment and public disparagement of the company, may, and often do, result in employee challenges.

Specifically, disparagement of and insults directed to co-workers, supervisors and the company in social media may be protected if the company’s prohibition is worded too broadly.

Indeed, workplace social media is a conundrum for compliance and risk personnel because it pits the needs to protect the company and its work force against federal laws that protect the rights of workers to comment about working conditions and to organize to do something about them.

Lafe Solomon, former General Counsel of the National Labor Relations Board, has called social media “the 21st century water cooler.” In ancient times, perhaps ten years ago, employees gathered around the office water cooler to exchange ideas, gossip and complaints about the company, co-workers and supervisors. But those comments rarely left the four walls of the office.

In the digital age, Facebook, Twitter and other sites permit such statements to be generated publicly, to a potential audience of millions. Accordingly, it would seem to be consistent with common sense to prohibit disparagement of the company and supervisors in social media.

In fact, however, this type of common sense butts heads with the National Labor Relations Act, according to several decisions of the National Labor Relations Board.

Section 7 of the National Labor Relations Act proscribes restrictions on employee statements of complaint about working conditions for the purpose of “concerted activity:” organizing by employees to do something about those conditions.

The NLRB has issued several decisions holding that the termination of employees who violated rules against disparagement in social media was improper, some resulting in orders for back pay to the employee and, occasionally, payment of the worker’s legal fees, in addition to the costs of the company’s own counsel.

Although the NLRB doesn’t keep statistics on reinstatement cases based on challenges to firings for violating social media policies, a report from the board’s general counsel has called the issue a “hot topic.”

In one case cited in the report, the firing of an employee for comments on Facebook and violation of a firm’s “non-disparagement rule” on social media was found unlawful for being “overbroad.”

Certain social media policy restrictions won’t violate labor laws (posts that violate state or federal confidentiality laws, most harassing behavior, etc.), but guidance is required so that intuition of workplace common sense doesn’t ground the company on the rocks of federal labor law when it comes to social media ground rules.

Kenneth Rashbaum is an attorney and principal of New York-based Rashbaum Associates, specializing in social media compliance, policy and other legal issues; privacy, cyber-security and electronic information compliance, and litigation. The firm's web site is www.rashbaumassociates.com.