Online Oversight

Adopting and enforcing clear digital use policies reduces your brokerage’s potential liability.

September 18, 2013

Odds are that some of your sales associates are online at this very moment. Maybe they’re updating their Facebook status. Or uploading a blog post. Or retooling their Web site.

But what if they’re doing something that creates liability for your brokerage? Brokers are right to be concerned about the online presence of their agents. It's up to you to develop a policy for your office that details online activities that are acceptable and unacceptable from a business standpoint­—and to make sure associates know they’re accountable.

Policy? What Policy?

If you haven’t already created guidelines for your associates’ online behavior, you’re in good company.

“I’d say that 5 percent of brokers, at most, have policies,” estimates Nobu Hata, Chicago-based director of digital engagement at the National Association of REALTORS®. “Most policies I’ve seen have been at larger brokerages. They have counsel who’ve recommended they enact a policy, or they have a big enough cadre of sales associates that someone’s already gotten them in trouble.”

It’s not that brokers aren’t paying attention to the risks, Hata says. Many are. But they don’t want to tighten the reins so much that sales associates balk—and end up leaving. But, as any defense attorney will tell you, a written policy is wise. “Every broker should have one, whether the broker has two or 200 salespeople,” Hata says. “Sales associates do a lot of things online on behalf of their brokers, whether it’s marketing listings or performing client care, and there’s so much gray area.” A written policy reduces the chance for misunderstandings.

Independence Has Limits

There’s another reason brokers hesitate to create guidelines, and that’s the independent contractor status of the overwhelming majority of salespeople. That shouldn’t hold you back.

“Independent contractor status isn’t really an issue,” says Michael Thiel, associate counsel at NAR. “Brokers have the responsibility for the conduct and business operations of their licensees notwithstanding the fact that they’re independent contractors. Brokers can enact policies they consider reasonable based on the risks they believe they face.”

That extends to associates’ behavior on their own devices. “You’re within your rights if you’re governing sales associates’ business activities, not their device used to conduct business,” says Bruce H. Aydt, abr, crb, senior vice president and general counsel at Prudential Alliance, Realtors®, in St. Louis. “A good example is a blog. Our company has a policy that salespeople must comply with Missouri Real Estate Commission rules, our company policies, and NAR’s Code of Ethics regardless of how they create or access their blog or e-mail messages. We think we have every right to say, ‘If you’re doing something that’s business-­related, we’re responsible, and you have to follow our policies.’”

There are two main issues you should consider. The first is confidentiality. “Client confidentiality is certainly very important because that’s front and center in clients’ minds,” Thiel says. “If you have a salesperson doing things online that causes sellers to question whether they can trust that person, those sellers may find ­another broker to do business with.”

The second is the company’s potential liability for materials posted online. The risk ranges from copyright and trademark infringement to invasion of privacy claims. Tell salespeople that the safest starting point is to assume that content, online or elsewhere, is protected by copyright and can’t be used without permission. “Online, look at the bottom of the page to find the ‘Terms of Use’ or maybe even ‘Copyright’ and click on those links,” Thiel says. “Sometimes all that’s required is that you acknowledge the owner; other times it will say use is only for personal, noncommercial [purposes]. If it does, that means you can’t include it in your site or newsletter.”

Thiel advises similar caution with privacy, specifically in the use of clients’ images. While laws generally permit publishing news images, there are more restrictions for commercial use. “They’ll have to be more careful than The New York Times in posting pictures of private individuals,” Thiel says. Plus, sales associates owe clients a duty of loyalty; that arguably includes doing what’s best for the client, including not using their images without their permission, he says.

In some cases, you’ll need to feel the pulse of your salespeople and their clients and craft policies accordingly. That’s because, for some issues permeating social media­ today, there are no clear right or wrong answers. Hata recently heard about a disagreement that ensued when salespeople discussed prelists—also known as pocket listings—in a closed Facebook group. “One salesperson accused another of not showing a prelist on an internal social network, and everybody got up in arms,” he says. “The broker had to intervene.”

A policy from A to Z

To begin drafting a policy, start at’s “Use of Social Media in the Real Estate Business,” a guide created by NAR’s Risk Management Committee. “Brokers can use what they need,” Thiel says. “They should be looking at their business model and saying, ‘Based on my model, here are the rules I need.’ ”

Aydt did just that, combining NAR resources with commonsense procedures for sales associates’ technology use and online activity. Here are just a few areas Aydt’s policies cover:

  • Business and personal use of company computers. Although most of salespeople have their own laptops or tablets, Aydt says, they also still use company computers. “I started with the use of company computers, specifically what’s appropriate and not,” he says. “Then I covered things like if somebody needs a computer for business purposes and you’re shopping on ­Amazon, you must yield the computer.”
  • Privacy and ownership of resources. “With company computers, we state that sales ­associates have no right to privacy,” Aydt says. “We also state that we own the systems and any information stored on those systems.”
  • Catch-all rules. “We have general policies on things like appropriate and inappropriate e-mails and Web sites,” adds Aydt. “We include NAR’s info on the federal CAN-SPAM act governing business e-mail use, and we have policies all the way down to social media activities.” For example, Aydt includes language prohibiting use of company computers to transmit or access inappropriate content, which includes “racial or ethnic ‘hate’ content, excessively violent content, or sexually explicit content.” The policy also prohibits salespeople from using “inappropriate” language and defaming, slandering, or libeling others in e-mail and on social media and from including links in advertising to inappropriate content or to a person or entity that hasn’t been specifically approved by management.
  • Other provisions to consider? “I’d include information in the independent contractor agreement providing that salespeople assign copyright for listing materials to the broker,” advises Brian Larson, a principal at the Larson Sobotka law firm in Minneapolis. “I’m talking about things like the photos and original text salespeople create to market property that ends up on the MLS and Web sites like®.” Larson would also require copyright to be assigned on content associates provide for the company blog or Web site, unless the parties agree otherwise. “And I’d require salespeople to advertise listings in a fashion consistent with the broker’s 
marketing policy,” he says.

First policy, then policing

The exercise of creating a top-notch policy won’t amount to a hill of beans if you don’t enforce it. “If you have a policy in place and ignore it, that means you knew you should have been doing something,” Thiel says. “If you’re groaning that there’s no time to focus on enforcement, delegate that duty. Having policies and enforcing them strengthens your relationship with consumers by showing you’re professional and on top of your business.”

freelance writer

G.M. Filisko is a Chicago area freelance and former editor for REALTOR® Magazine.