With seven hundred and fifty million people actively using Facebook, there is a significant chance that a post about working conditions, compensation or other issues related to their employment will spark a conversation with an employee’s colleagues, and such conversations may constitute concerted activity under the National Labor Relations Act.

The question remains, if your employees say something negative on Facebook about your company, their fellow employees or their supervisors, can you terminate without running afoul of the National Labor Relations Act?

The answer depends on the facts surrounding the post(s). The test is whether the employee is engaging in activity solely for himself or on behalf of other employees.

Individual social media griping activity that is the “logical outgrowth of concerns expressed by the employees collectively” are considered “concerted” and protected under Section 8(a)(1) of the the National Labor Relations Act (“Act”). “Concerted activity includes ‘circumstances where individual employees seek to initiate or to induce or to prepare for group action’ and where individual employees bring ‘truly group complaints’ to management’s attention.” Meyers Industries, 281 NLRB 882, 885 (1986)

The following factors should be considered:

1. Is the post concerted activity?
2. Is the post directed at other employees?
3. Does the post suggest that the employees take some action?
4. Is the employee posting a Spokesperson for Common Concerns?
5. Does the post arise out of a previous union or employee group?

What this means is that not all online posts are protected. Two Advice Memorandums issued this July by the National Labor Relations Board, Office of The General Counsel regarding non-union companies provide guidance. In JT’s Porch Saloon & Eatery, Ltd., the NLRB found no concerted activity when a bartender complained to his step-sister on Facebook that he had not received a raise in five years, he was performing waiter’s work without tips, the Company’s customers were “rednecks” and he hoped the customers choked on glass as they drove home drunk. The Board found that the termination was not in violation of the Act because the post was not discussed with any other employees, before or after he wrote it and there had been no employee meetings or attempt to initiate group action regarding the tipping policy.

Similarly, in Wal-Mart, the NLRB found no concerted activity when a customer service employee, after an interaction with the Assistant Manager, posted the following comment on his Facebook page: “Wuck Falmart! I swear if this tyranny doesn’t end in this store they are about to get a wakeup call because lots are about to quit.” The Facebook friend responses were mixed with some friends responding favorably and others not. The customer service employee responded further by making negative comments regarding his supervisor, using profanity and claiming false advertisement on behalf of Walmart. Of course, a co- worker “friend” gave a copy of the post to the supervisor at issue and the supervisor required him to take down the post, suspended him for a “decision day,” and prepared a discipline report.

In defense, Walmart claimed that the postings were not concerted activity for mutual aid or protection, and even assuming so, the Charging Party’s use of profanity was so “opprobrious” as to deprive him of the Act’s protection. The Advice Memorandum found the customer service employee’s comments were solely about him and were “mere griping.” The comments did not look toward group action.

In contrast, the National Labor Relations Board issued a complaint alleging that the Hispanics United of Buffalo unlawfully discharged five employees because they took to Facebook to criticize working conditions, including work load and staffing issues. In this case, an employee, in advance of a meeting with management regarding working conditions, posted an allegation that employees did not do enough to help the organization’s clients. Five employees responded and defended citing work loads and staffing issues. The organization terminated the five defending employees because their defense constituted harassment of the employee originally mentioned in the post. The National Labor Relations Board Complaint claims that the Facebook discussion was protected concerted activity. Outcome of this complaint is not known at time of this post.

Social Media has been likened to a “loaded gun.” For all its benefits, it can be quite dangerous to the employer as well as the employees if it is not used appropriately. It is in the employer’s best interest to establish legal social media policies and train employees on the ramifications of their social media use as it relates to their employment.

However, employers should not impair an employee’s ability to act in concert or to effect some change in the terms and conditions of the workplace.

Just as employees should think before posting on Facebook, employers should think carefully before disciplining employees to avoid running afoul of the National Labor Relations Act. As unwise as it may be to complain about one’s employer on Facebook, it may be unlawful for an employer to discipline an employee for voicing such a complaint.

For more information and guidance, please check out the National Labor Relations Board Acting General Counsel Report on Social Media Cases.

Posted by Attorney Ruth A. Binger. Binger serves both emerging and mature businesses concentrating in corporate law, intellectual property and technology law, and labor and employment law. Her commitment to the success of small to medium-sized businesses, and her understanding of multi-faceted issues inherent in operations, are what distinguish Binger’s practice.

A company wanting protection for a mark that it will use in interstate commerce will generally want to register it with the United States Patent and Trademark Office (“USPTO”). If the mark is only used in one state or a limited number of localities, a company may choose to register with a state trademark registry, or rely on common law protection (even unregistered marks may be entitled to some protection). A mark may not be registered if it (or a similar mark) is already in use to describe a competing product or service.

A company’s goal in selecting a mark is to choose one that is memorable, so that it is capable of distinguishing a company’s offerings in what may be a virtual sea of similar products or services. Once a company selects a mark, it often expends significant capital on advertising and marketing, hoping to build brand recognition based on the trademark. However, not all marks are created equal. Some types of words and phrases can be protected; i.e., a company can use the mark to the exclusion of its competitors; while others cannot.

In explaining what protection is available for different types of marks, courts have defined a continuum of marks, based upon their distinctiveness, and described as weak to strong, with the weakest marks entitled to no protection, while strong marks are presumptively entitled to protection. The weakest marks are those described by the courts as generic marks, which can never be protected. The continuum then progresses from descriptive marks, to suggestive marks, and finally to the strongest marks, fanciful or arbitrary marks.

Generic Marks

A generic mark is one which refers to the common name or nature of an article. Such names are not entitled to any trademark protection. Generic words are considered to be in the public domain and available for anyone to use. Examples of generic marks include: “Frosty Treats,” “Diet Chocolate Fudge Soda,” “Ivory,” when used to refer to products made from an elephant’s tusk (but not when used to refer to soap); and “Lite Beer.” Courts held these marks to be generic because they state or identify the very nature of the product being sold.

A registered mark, even though it qualified for protection when registered, may be canceled at any time on the grounds it has become generic. “Escalator” is a mark which was canceled as having become generic, because its owners allowed it to be used to describe moving staircases, generally.

Descriptive Marks

A “descriptive” trademark is one which immediately conveys or describes the nature or function of a product, its ingredients, qualities or characteristics, rather than constituting a name for the good or service to which it is attached. The phrase “Duluth News-Tribune” was held to be descriptive because it informs readers that the product is a Duluth newspaper, but is too specific to refer to the genus of newspapers (i.e., it does not describe all newspapers), or even all newspapers published in Duluth.

Other examples of descriptive marks include: “Park ‘N Fly”; “Deep Bowl” when used to apply to a “Deep Bowl Spoon” (although the word “spoon” as used in this example is generic); and “Security Center.” A descriptive mark is only entitled to protection if it has developed secondary meaning (i.e., if through advertising and marketing the consuming public has come to associate the mark with goods or services offered by a particular company). A descriptive mark may only be accepted for registration on the principal trademark registry by the USPTO when its proponent can prove it has acquired secondary meaning.

Suggestive Marks

It is not always easy to distinguish between suggestive and descriptive marks. A term is suggestive if it requires some imagination to reach a conclusion as to the nature of goods offered under the mark, as opposed to a descriptive mark, which forthwith conveys an immediate idea of the ingredients, qualities or characteristics of the goods. However, courts have had a great deal of trouble in practice in applying the distinction between descriptive and suggestive marks. For instance, a 2007 decision by the U.S. Court of Appeals for the 7th Circuit held the mark “Work ‘N Play,” as applied to a conversion van, to be a merely descriptive mark. Since this mark does not describe any feature of the van, but merely the uses to which a potential purchaser might put it, this mark should have been found to be suggestive.

Examples of marks which have been held to be suggestive include: “safari,” as used to describe luggage, portable grills, swimtrunks, raincoats, and belts (however, “safari” was held to be descriptive with regard to clothing of the type typically worn on an African hunting trip); “roach motel” (in that case the Court noted that “while roaches may live in some motels against the will of the owners, motels are surely not built for roaches”); “Coppertone”; “MovieBuff,” to refer to a searchable data base with entertainment industry information; and “Miraclesuit” as used to describe a woman’s swimsuit which supposedly made its wearer look thinner.

Fanciful or Arbitrary Marks

Arbitrary or fanciful marks use terms that neither describe nor suggest anything about the product. Such marks bear no logical or suggestive relation to the actual characteristics of the goods or services they are used to market. A fanciful mark is one which was invented solely to be used to market a particular good or service; i.e., it is a made up term. An arbitrary mark is a known word used in an unexpected or uncommon way.

Examples of fanciful marks include: “Kodak”; “Exxon”; “Xerox”; and “Kleenex”. These were all terms coined by their owners solely to market products offered by them, and which have no independent meaning. Examples of arbitrary marks include: “Starbucks,” “Camel” cigarettes, “Domino” sugar, “Dove” soap, “Apple” computers, and “Dawn” dishwashing detergent.

Suggestive, fanciful, and arbitrary marks are entitled to protection from their first use in commerce, and can be registered on the USPTO’s principal trademark registry. Fanciful and arbitrary marks are, generally, considered to be the ‘strongest’ or most distinctive marks. For this reason, lawyers advising clients concerning adoption of a new mark will suggest that they adopt either an arbitrary or fanciful mark. Even though suggestive marks are entitled to the same protection, lawyers will often suggest that clients avoid such marks given the trouble Courts have in determining whether a mark is suggestive or merely descriptive.

Thus, when my father chose the word “Rembrandt” to pair with the words “Photo Studios” to describe his business, he made a good choice in that Rembrandt is an arbitrary mark (i.e., it is a surname of a famous painter). It neither described nor suggested what his business did (although the words Portrait Studio did). It is important to note that in registering a mark, you may pair arbitrary, fanciful or suggestive words with descriptive or generic words, provided that you disclaim any ownership of the descriptive or generic words.

Choosing a name or phrase which you will use to market a product or services is important. Your entire investment in advertising a mark can be lost if words are chosen which cannot be protected, or which infringe upon an existing mark. Further, trademark litigation is expensive. For these reasons, small businessmen should always consult with experienced trademark counsel before choosing and using a mark.

View PDF

Patent and copyright law provide an entrepreneur some rights in relation to employees involved in developing patented or copyrighted material. Additionally, an entrepreneur has some common law rights in its trade secrets and confidential information. However, in order for a business to fully protect its interests in intellectual property developed and utilized by it, it is important to implement written agreements
that specifically address the rights of the business and its employees relative to such inventions and information.

In this respect, one size certainly does not fit all. Instead, it is important that agreements between businesses and their employees be customized to address their specific circumstances. More and more, courts in Missouri are refusing to enforce overly broad restrictions against competition by former employees. The remainder of this document will contain an outline regarding various types of provisions an entrepreneur may wish to consider including in employment agreements, and various considerations with regard to each type of provision.

Pre-Invention Assignment Agreements.

Such agreements allow a business to obtain exclusive property rights of patentable inventions developed by its employees.

Without such an agreement, an employee may own the invention. In some cases, the employer may have a non-exclusive license to the invention. However, if the invention was developed on the employee’s own time, the employer may have no interest in the invention, even though it relates to the employer’s business.

Continued employment is sufficient consideration for a pre-invention assignment agreement.

Such agreements may specify certain categories of inventions assigned to the employer, or provide “blanket” coverage of any and all inventions.

Copyright Assignment Agreements.

These are similar to pre-invention assignment agreements. A software developer will want to have pre-invention and copyright assignment provisions in its employment agreements.

Trade Secret/Confidential Information Non-Disclosure Agreements.

Trade secrets and confidential information of a business include such things as formulas, patterns, devices, and compilations of information used by a business which the business has taken precautions to keep secret and from which it derives economic benefit. Generally, in order for something to constitute a trade secret or confidential information, an employer must restrict access to such information to employees who have a reasonable need to see it.

Such agreements generally prohibit an employee, either during the term of his/her employment or thereafter, from disclosing trade secrets or confidential information to any third party, or from utilizing such
information for the employee’s own benefit.

To the extent possible, such agreements should specify the type of information that the business considers to constitute trade secrets or confidential information. This is so the employee cannot claim that he/she did not have notice that a particular piece of information was a trade secret or otherwise confidential to the business.

Non-Compete Agreements.

A significant minority of states (e.g., California and Georgia) have held non-compete agreements are unenforceable. Generally, the law of the state where the employee will perform most services (or if he is a traveling employee, the state in which he lives) will control whether or not the agreement is enforceable. Some states will refuse to enforce such agreements as to their residents, even if the agreement would be enforceable in the state where the agreement was executed or performed.

Must be reasonable as to both temporal and geographic scope. What is reasonable differs from state to state.

Such agreements are disfavored by the Courts, and will generally only be enforced if the employee had access to trade secrets or confidential information.

In the St. Louis City and County Circuit Courts, the Courts will generally not enforce non-compete agreements if the employer’s interests are adequately protected by a non-solicitation agreement.

Non-Solicitation Agreements.

Some states that will not enforce a non-compete will enforce a nonsolicitation agreement. These agreements generally prohibit an employee from soliciting the customers of his/her former employer for a set period of time.

Such agreements will generally be enforced for a period of two to three years following termination of employment. A non-solicitation agreement need not include a geographic limitation.

Leads and prospects are generally not protectable under a nonsolicitation agreement.

Agreements Prohibiting Solicitation of Employees.

It has been quite common for companies to include provisions in their employment agreements prohibiting employees, after termination of their employment, from trying to lure away other of the company’s employees. However, the Missouri Court of Appeals for the Eastern District of Missouri has recently held such provisions to be unenforceable. The court held that “an employer does not have a proprietary interest in its employees at will or in their skills.” Schmersahl, Treloar & Co. v. McHugh, 2000 WL 1051831. The Missouri Supreme Court refused to hear the case.

Pre-Employment vs. “After-Thought” Agreements.

Courts in Missouri have held that continued employment generally constitutes sufficient consideration for the various types of restrictive covenants discussed above, so that they may be entered into at any time during the course of employment. However, questions remain as to whether continued employment will be sufficient consideration in all circumstances. The better practice is to either enter into restrictive
covenants at the time an employee is hired, or in conjunction with a raise or promotion.