In our continuing focus on employment law, Mandeep Kalsi considers some key legal developments and important issues facing employers and employees in the UAE against the backdrop of some memorable motion pictures involving the workplace. In Part 1 of this series, the spotlight is very firmly focused on the world of social media and redundancies….
a Dubai Eye 103.8 radio interview in which Mandeep Kalsi and Alex McGeoch discuss the ownership of social media information and the use of social media while at work.
TAGLINE: THE LEGAL IMPLICATIONS OF SOCIAL MEDIA IN THE WORKPLACE
SETTING THE SCENE: The Social Network (2010) (Director: David Fincher) – A critically-acclaimed look into the origin of the social phenomena Facebook, and its founder, Mark Zuckerberg. Facebook's current membership is estimated to be around 800 million (out of which approximately 2.7 million were found in a survey to represent Facebook users in the UAE), and with its planned 2012 flotation, it is expected that this figure (and Facebook’s popularity and influence) will further increase.
Employee usage, both inside and outside the workplace, of social media and networking sites such as Facebook, LinkedIn and Twitter is widespread. Maintenance of employees' rights to privacy on the one hand and an employer’s own expectations regarding employee conduct and the safeguarding of its legitimate business interests and reputation on the other requires a balanced approach and careful management.
Whilst employers are increasingly recognising the dividends of social media from both a marketing and client relationship perspective, from a legal point of view, issues such as breach of anti-discrimination provisions (for which the employer may be held vicariously responsible), defamatory or damaging publications including inadvertent disclosure of company confidential information, and the cost to the business of working time lost to social media are very real concerns.
To recruit or not to recruit...
On Facebook, depending upon an individual's privacy user settings, information such as religious beliefs, marital status, political preferences and affiliations and other personal content not evident from an application form may be involuntarily disclosed to the world at large, or to a wider cross-section of people than originally intended. In the 2010 Microsoft commissioned survey "Online reputation in a connected world", 41% of the recruiters and HR professionals surveyed said that they had rejected candidates based on information found online, including from social media sites such as Facebook.
Clearly, there are a number of risks associated with rejecting or unfairly filtering candidates based on online information. Most notably, the DIFC Employment Law provides that an employer shall not refuse to employ or discriminate against a person regarding employment or any term or condition of employment because of a protected characteristic (namely, race, gender, marital status, nationality, religion or disability) unless there is a bona fide occupational requirement. Currently, the Director of Employment Standards - the officer of the DIFC Authority responsible for the administration of the DIFC Employment Law - may determine what constitutes a bona fide occupational requirement. Employers should therefore ensure that any decision not to recruit an applicant and/or to reject their application is based on sound and legitimate grounds and is not tainted by discrimination.
Facebook and/or Twitter could potentially be used as a forum for work-related discussion. On LinkedIn, employees may create lists of their contacts or networks, which could include customers, clients and suppliers acquired through their work. Quite apart from questions as to the ownership of contact lists generated during the course of employment (and the utilisation of such client contact information upon termination), for employers a primary concern will be whether their confidential information is being posted or inadvertently disclosed online.
Employees need to be mindful of the dangers of unwittingly exposing themselves to civil and/or criminal liability as a consequence of their online actions and/or activities. Article 905 of the UAE Civil Code states that "the employee must keep the industrial or trade secrets of the employer, including after the termination of the contract, as required by the agreement or by custom". Article 379 of the UAE Penal Code also provides that it is a criminal offence for an individual to use a third party's information without consent for his own or another's advantage where that information was gained as a result of that individual practising his 'profession, art or craft". In addition, Article 120 of the UAE Labour Law provides for instant dismissal – without notice or payment of end of service gratuity – where an employee divulges confidential information to a third party for his or that party’s own advantage.
Company policies and employment contracts should define what information is considered confidential and clearly set out employee obligations during and post-termination of employment. It is important to bear in mind that confidential information does not retain its quality of “confidentiality” forever. What makes it confidential is its value as an asset of the business and such asset value (e.g. lists of customers, pricing policies, potential business opportunities, etc.) may tend to decline with the passage of time and depending on the transient nature of such data.
The extent to which employees' online activities are monitored during company time should ideally be clearly set out in an IT policy, laying down the expected standards in terms of reasonable usage during working time, and employees should be informed, and arguably their consent should be obtained.
In other parts of the world, there has already been a steady stream of cases where damage to an employer's reputation has occurred as a consequence of employees’ use of social media. In one English case, a manager at JD Wetherspoons Plc was dismissed for gross misconduct when she posted on her Facebook page inappropriate comments about some customers. As a result of her failure to ensure that her “privacy settings” were adequately secure, these comments were inadvertently disclosed to the public at large, including the customers in question who raised the issue with the employee's employer. In another case, Virgin Atlantic took action against staff who criticised on Facebook its passenger class status, which was widely reported in the media. Although each case is fact-specific, they nevertheless act as a salutary warning to employees that their "out-of-work" use of social media sites is not necessarily private and could have implications on their employment relationship.
The UAE Labour Law expressly provides that disciplinary penalties may not be imposed on an employee who has committed an offence outside the place of business unless the said act is relevant or connected to the business, the employer or its responsible manager. Accordingly, the employer has the onus of proving that the employee’s online actions have had an appreciable effect on its business. However, Article 120 provides for instant dismissal where an employee is convicted of an offence involving honour, honesty or public morals.
Again, a clear and robust disciplinary policy communicated to all employees and outlining acceptable standards of behaviour and covering issues such as the posting of inappropriate material online, together with the sanctions for breach, would go a long way towards assisting employers when seeking to justify any subsequent disciplinary action and perhaps even dismissal. It is critical for employers to make it clear that if out-of-work activities detrimentally affect the employer's reputation, the employer is entitled to take disciplinary action.
Under the DIFC Employment Law, an employer may also be held legally responsible for any discriminatory acts of their employees, subject to such acts having been committed in the course of employment. This could, for example, include cyber-bullying or harassment of employees or the posting of discriminatory comments or material on an individual's Facebook page. In order to avoid liability, an employer must demonstrate that an employee who is allegedly responsible for the bullying, harassment, etc., acted outside "the course of their employment" and that it took reasonable measures to prevent such employee from committing the acts in question. There are no rigid guidelines on the necessary level of preventive action, but a written equal opportunities policy that is very actively implemented will serve as a useful measure in this regard.
TAGLINE: CORPORATE DOWNSIZING – THE LEGAL CONSIDERATIONS OF TERMINATING EMPLOYMENT RELATIONSHIPS
SETTING THE SCENE: Up in the Air (2009) (Director: Jason Reitman) – This is not your average run-of-the-mill film. George Clooney plays Ryan Bingham, a corporate downsizing executive for the Career Transitions Corporation, who is contracted by companies across the United States to terminate their staff...
Employee terminations, as evidenced by several awkward scenes in the film, involve an inevitable degree of emotion and are never easy. In these times of economic uncertainty, many companies are considering the possibility of reducing their payroll costs by reducing their headcount. From a legal perspective, there are certain points to consider when proposing to make staff redundant.
Termination - UAE Labour Law
Under the UAE Labour Law, termination of an unlimited term contract (other than in the circumstances provided for in Article 120) must be on written notice and for a "valid reason" (i.e. a reason connected to the employee's work). The labour court may award compensation of up to three months' remuneration should the termination be deemed by the court to have been arbitrary.
Although there is no statutory definition of redundancy in the UAE Labour Law, the labour courts have recognised an employer's right to restructure its business and have held that redundancy is a valid non-arbitrary reason to terminate an employee.
However, any decision to make a particular employee or group of employees redundant should be capable of justification and, in all the circumstances, be reasonable, fair and transparent in the event that any redundant staff member(s) chose to bring against the company a claim for arbitrary dismissal. To limit exposure, employers should undertake a limited consultation process. In the case of fixed-term contracts, in the event that the employer (or employee) terminates it for any reason other than those under Article 120 (or Article 121) of the UAE Labour Law, unless the employment contract provides otherwise, early termination compensation for a period of three months (at full pay in the case of a defaulting employer and half pay in the case of a defaulting employee) or salary for the residual period of the contract, if shorter than three months, will automatically become payable.
Moreover, there are restrictions on the dismissal of UAE nationals, following Ministerial Decree No. 176 of 2009, "Restricting the Dismissal of UAE Nationals".
Termination - DIFC Employment Law
The DIFC Employment Law, as currently drafted, impliedly recognises the concept of 'redundancy' by providing that those "dismissed as redundant" are entitled to take reasonable time off during working hours, and before the end of the notice period, to look for new employment. However, as at the present time, there is no statutory definition of ‘redundancy’ or any prescribed redundancy process or procedure to follow; and nor does there exist an express concept of unfair dismissal.
Termination without notice is permitted but only where an employee commits an act of "misbehaviour" which is defined in broad terms to encompass where an employee's conduct warrants termination and a reasonable employer would have terminated the employee (ie in such circumstances).
Author: Mandeep Kalsi
All recommendations in this publication are provided without consideration of any specific reader's objectives, situation or particular needs. Those acting upon such recommendations do so entirely at their own risk.