Educate Employees about Online Endorsements – the FTC is Watching!

A few months ago, I posted Does your Employee Handbook address social media? This post discusses a specific social-media issue that is of great importance to every employer: Online endorsements of products or services by employees.

The Federal Trade Commission has published Guides Concerning the Use of Endorsements and Testimonials in Advertising. Actions that are inconsistent with the Guides may result in an FTC enforcement action.

Section 255.5 of the Guides states:

When there exists a connection between the endorser and the seller of the advertised product that might materially affect the weight or credibility of the endorsement (i.e., the connection is not reasonably expected by the audience), such connection must be fully disclosed.

So, if an employee touts your product or service on your company’s blog, no disclosure is required, because a company is expected to promote its own products or services. But if an employee touts your product or service on someone else’s blog, the employee should clearly and conspicuously disclose the employment relationship to readers of the blog.

Every employer should make employees aware of this requirement and should address this issue in its Employee Handbook.

Related post: Paid Online Endorsements – It Appears that Amazon.com Cares, Too

Dana H. Shultz, Attorney at Law  +1 510-547-0545  dana [at] danashultz [dot] com
This blog does not provide legal advice and does not create an attorney-client relationship. If you need legal advice, please contact a lawyer directly.