If employees treat social media as a sort of online water cooler where comments are posted about colleagues, managers and customers, what rights do employers have to control the conversation?
Social media networks like Facebook and Twitter open up a floodgate of human resources issues that companies must address with a formal policy and open communication with employees — before a litigious situation arises. Can a business owner fire an employee for bad-mouthing the company? Is it permissible for a worker to complain about company decisions and managers on Facebook? How “private” are these social media postings, really?
“Recent court cases shed light on the responsibility employers have to create a solid social media policy and to talk with employees about how social media is used in and out of the workplace,” says Christopher Carney, chair of the Labor and Employment Practice Group at Brouse McDowell in Cleveland.
Smart Business spoke with Carney about social media regulation and what employers can do to be proactive in this fast-changing area of business and the law.
What are some common mistakes businesses make when using social media?
It is no secret employers use social media to screen applicants. However, they can get into trouble when they use social media to screen out applicants. It is illegal to discriminate against someone in the hiring process on the basis of race, gender, religion, disability or sexual orientation. It is also illegal to use an applicant’s Facebook page or Twitter account to eliminate candidates. The bottom line is that if you possess this information and it goes into your decision-making process, that is against the law.
The best way to avoid problems in this area is to have a third party do the screening. That way, the ultimate decision-maker does not see any legally protected information discovered using social media. If you cannot use a third party, then your company’s HR department should do the screening and not provide you with any legally protected information.
Another common mistake employers make is to ‘friend’ employees with a fake profile or seek information about an employee through a third party that is ‘friends’ with the employee. Even with the Internet, there is an expectation of privacy with Facebook because the profiler invariably limits access to his or her Facebook page.
How has the government attempted to regulate the use of social media by employers?
Here is some background: Section 7 of the National Labor Relations Act (NLRA) protects employees who engage in ‘concerted activities for the purpose of collective bargaining or other mutual aid or protection.’ The NLRA’s protections are not limited to union organizing activities or employee conduct in a unionized environment. ‘Mutual aid or protection’ includes any group of unrepresented employees talking about wages, hours and working conditions. In 2010, the National Labor Relations Board (NLRB) made national headlines by issuing a complaint accusing an employer of unlawfully discharging an employee for posting critical remarks on her Facebook page questioning her supervisor’s mental health. Since then, the NLRB has continued its focus on social media, aggressively prosecuting cases where employees are discharged or disciplined for social media use. Two recent NLRB administrative law judge decisions illustrate how the NLRB is shaping the law in this area.
In September 2011 the NLRB found that an auto dealer did not violate the NLRA when it fired a car salesman who had posted on Facebook photographs of and made sarcastic comments about an accident that occurred at one of the employer’s dealerships. The judge concluded that the posting was not protected because it was posted ‘without any discussion with any other employee . . . and had no connection to any of the employees’ terms and conditions of employment.’ In another decision that came out at the same time, a judge held that a nonprofit, social service organization did violate the act by firing five employees who posted on Facebook negative comments about their workloads and staffing issues. The judge determined that the terminated employees’ discussions were protected, concerted activity because it involved conversations among co-workers about the terms and conditions of their employment, including job performance and staffing levels.
Notably, both cases dealt with non-union employers.
What should business owners take away from these cases?
The natural inclination for a business owner is to take action against an employee for making critical statements about the business or its owners, particularly in such a public forum as the Internet. However, employers should proceed with caution. General griping is one thing, but if the criticism is tied to a term or condition of employment and is between or among co-workers, then it is likely protected. Any adverse employment action could potentially violate the law.
Should employers have a social media policy?
Yes. And any such policy should be narrowly tailored to avoid ambiguity. It should inform employees that the policy does not prohibit employees from discussing or disclosing the terms and conditions of their employment. Also, any social media policy should clearly state that employees are prohibited from disclosing confidential or proprietary information on social media. It also should prohibit employees from making disparaging comments about the company, its employees or its customers. Finally, the policy should place employees on notice that the employer may monitor employee postings in order to minimize any expectation of privacy the employees may think they have.
It’s a good idea to consult with a legal professional when crafting a social media policy to be sure that the house rules you set comply with the law and cover any worst-case scenarios that could occur.
Christopher Carney is chair of the Labor and Employment Practice Group at Brouse McDowell in Cleveland. Contact him at (216) 830-6830 or CCarney@brouse.com.
Your intellectual property may be safe at home, but do those patents and trademarks sink or swim once they reach international waters? Businesses may want to pursue a patent or trademark outside the United States to preclude a competitor from using their trademark or from making, using or selling whatever is protected by their patent.
“You have to take proactive steps to protect your patents and trademarks outside the United States, because coverage is generally on a country-by-country basis.” says Scott McCollister, a partner with Fay Sharpe LLP.
“For example, if you have a patent in the U.S., it doesn’t have any extra territorial effect. Trademarks are generally similar. Some countries may have common-law rights which develop based on your use in that jurisdiction, but many countries are registration-based, so you have to procure a registration through that country’s national trademark office before you have any chance to preclude a third party from using your trademark.”
Smart Business spoke with McCollister about how companies can take their intellectual property international.
In what situations would it makes sense for a business to pursue international protection for its IP?
If a business is selling or anticipates selling in a particular territory, it may want to pursue patent or trademark protection in that jurisdiction .
Similarly, companies should consider procuring protection in areas where you and/or your competitor manufacture. Even if it’s not a large sales region, or if the products are shipped elsewhere for distribution, having patent protection in a jurisdiction where the relevant goods are manufactured can be extremely beneficial. If you or your competitor don’t manufacture or sell in a particular country, pursuing patent or trademark protection there is most likely an unnecessary expenditure of funds.
What are the main considerations for a business preparing to take its IP international?
Even in countries where you are commercially active, before you consider pursuing patent or trademark protection, you should do a cost-benefit analysis. Patents, in particular, are expensive to obtain and maintain. There are foreign agent fees, translation fees, government fees, prosecution fees and annuities.
Protecting a small volume of product sales in a country by filing a patent application probably doesn’t make a lot of sense if the cost of obtaining the patent is even a measurable fraction of the sales volume.
Furthermore, consider the lifespan of your product. If your product has a five-year lifespan, it doesn’t make a lot of sense to file an application in a country that takes years to grant a patent.
How can using a regional or international office reduce cost?
For each country you file in, you generally need a local agent who submits the patent or trademark application to that country’s patent/trademark office. Accordingly, for every national filing there are associated governmental expenditures and service fees paid to a local agent. However, using Europe as an example, we have the option of filing through a regional office, the European Patent Office (EPO), that has the ability to grant one patent that can be extended to any selected country within the European Community. In this manner, we can submit all patentability arguments before one examiner and employ only one European agent to perform the bulk of the work in the European region. Similarly, a significant cost savings can be achieved using the European Community Trademark Office to obtain a ‘European Community’ trademark registration rather than pursuing and maintaining multiple national registrations.
I also recommend using the Patent Cooperation Treaty (PCT) for international patent filings. One year after you file your U.S. application, you can file a PCT application. It is effectively an 18-month placeholder. I refer to it as a placeholder because the application cannot directly mature into a national patent. Rather, at the end of the 18-month period, you will need to file in any country (or region, if available) in which you are interested in obtaining coverage. Advantageously, during the 18-month period you receive a preliminary report on whether the idea is patentable or not.
This provides two primary advantages. First, if the review finds the idea is not patentable, you’ve spent a relatively small amount of money on a PCT application instead of a large amount of money filing the application in multiple countries.
Second, it buys you another year and a half to evaluate if the product is commercially relevant. Does it deserve protection or did it fizzle? It may have been a good idea at the time, but the marketplace didn’t accept it. Buying that extra year-and-a-half lets you evaluate how interested you really are in protecting the invention.
The same is true on the trademark side. Based on your company’s U.S. trademark filing, the Madrid protocol allows you to file on a worldwide basis through a single international agency, and have the trademark extended into countries you designate. A significant savings is achieved by avoiding hiring of a lawyer in every country.
What other steps do you recommend for businesses going international?
Assuming you satisfy these criteria and want to proceed, you can still be wise in how you spend your money. For example, procuring a patent in the eight countries with the largest economies in Europe and keeping that patent alive for 20 years is an expenditure in excess of $100,000.
However, if we pursue the patent in Germany, England, France and maybe a country where your competitor is headquartered (preferably through an EPO filing), we can achieve similar results for roughly half the cost. Moreover, your competitor may be unlikely to introduce product X in Europe if they are precluded by your patent from selling in a large percentage of the market. I believe with a little analysis we can often achieve the same result in Asia or South America, for example.
Lastly, I strongly encourage any company considering pursuit of IP coverage outside the U.S. to have an open dialogue regarding costs, risks, advantages, objectives and expectations with a patent and/or trademark attorney. Moreover, this is a complex topic and many of the observations outlined above are not applicable to all situations and can have certain limitations.
Scott McCollister is a partner with Fay Sharpe LLP. Reach him at (216) 363-9115 or email@example.com.
The Marcellus Shale is a layer of rock that contains a large amount of natural gas deposits and is believed to be one of the largest natural gas reservoirs in the U.S. Recent explorations have estimated that the Utica Shale, a deeper and larger layer, contains a much greater volume of natural gas.
While these reserves were recognized for years, it was neither practical nor cost effective to drill until recently, due to new extraction methods like horizontal drilling and hydraulic fracturing.
Sales of land in affected regions of Ohio have picked up as investors position themselves to take advantage of the buying and leasing frenzy, says Terry Coyne, SIOR, CCIM, executive vice president with Grubb & Ellis.
“If you’re interested, move quickly,” Coyne says. “Because while most people are not aware of the value of this land, there are speculators moving in who are buying it up cheaply.”
Smart Business spoke with Coyne about how property owners and potential investors can best capitalize on the interest in the Utica and Marcellus Shale.
What is the economic impact of planned drilling in Ohio?
Carroll County is the center of initial drilling development, but the impact will be felt in Summit, Portage and Stark counties as well.
Direct Utica gas exploration and development expenditures amounted to $246 million in 2011. They are estimated to ramp up to $14 billion by 2015. Over the next five years, oil and gas producers are projected to spend more than $34 billion, not including lease and royalty payments.
By 2015, Utica Shale development alone is estimated to create or support more than 200,000 jobs in Ohio. You make money in real estate in areas with employment growth, and that is explosive employment growth.
How is the interest in natural gas from the Utica and Marcellus Shale regions affecting real estate in these areas?
There is gas drilling going on, there are real results, and people are making money. Now, in sleepy towns like Wellsville and Toronto, people are buying property. Whether it’s land or buildings, investors are buying it up for the purpose of servicing the oil and natural gas business.
In Canton, there has been a million square feet of leases or sales in the last 30 days. That’s a lot in any market, let alone in Canton, where properties can stay on the market for a long time. Canton and Akron stand to profit because they fit inside the Utica area, but can offer better proximity and real estate than places like Belmont and Carroll County.
Two brothers that purchased a property outside of Zanesville for $400,000 just sold it for $2.4 million. People are in need of real estate in the shale areas, and if the property is a building that is ready to be occupied today, its value is increased because the demand is real.
Outside of the real estate business, people aren’t recognizing this quite yet. But there are anecdotal tales from the Pittsburgh market, where vacancy rates for industrial and office are both sub 5 percent because the oil and gas service business has descended on these properties for shale development.
In real estate, you want to be in a rising market. This is a rising market.
What can companies that are already established in these areas do to take advantage of the rising market?
You have to work with professionals to do two things: first, negotiate properly for your mineral rights. If you are looking to sell your building, make sure you either retain your mineral rights separately, or if you do sell your mineral rights with the building, make sure your price reflects it. Don’t give away your mineral rights. Retain them or get paid for them.
Second, when marketing your building for this specific use, you should connect with someone who knows the Utica/Marcellus real estate market.
Essentially, there are two ways to make money. One is through royalties; so every time a dollar of oil or natural gas comes out of the ground, the land’s owner gets some percentage of it. These royalties typically used to be 12 percent of the gross, but the standard now seems to be 17.5 percent and some deals have even reached 19 percent.
The other way to make money is through bonus checks, or ‘lease payments.’ For instance, a landowner might be paid 17.5 percent in royalties plus $1,000 per acre. In some situations, purchasers have paid $5,000 per acre just for the right to drill.
If you decide to sell your mineral rights, how can you ensure they are accurately valued?
It’s tricky, because you could just as easily get a dry hole as a hit. In this case, your property income is not very predictable. The best way to find out what the property income will be is to learn what neighboring wells have produced. That is public data that you can find yourself, or you can call an expert.
What kind of development can be expected in the near future?
There is a whole supply chain of vendors and suppliers moving in. We’ve already seen Timken Co., V&M Star and Republic Steel ramp up their capacity for products that are sold into the oil and natural gas supply chain. Then there are companies that haul water, provide mud, or provide well tending services, and others that build hotels and temporary housing, because of the need to handle the population of incoming workers. That will drive retail demand and housing demand.
Terry Coyne, SIOR, CCIM, is an executive vice president with Grubb & Ellis. Reach him at firstname.lastname@example.org or (216) 453-3001. For more information on Marcellus and Utica Shale, visit www.uticamarcellus.com.
As fears of identity theft and online privacy concerns increase, PCI compliance has become a vital priority to any company that deals with credit card information. If you allow customers to pay with a credit card, you have to pay attention to the regulations and stay compliant. The consequences are severe: Just one data breach can wreck your company’s finances and reputation in one fell swoop.
“Everyone is bound by PCI compliance,” says Zack Schuler, founder and CEO of Cal Net Technology Group. “It doesn’t matter if you are a small, ‘mom and pop’ hardware store or a national retail chain; if you accept credit cards, you have to adhere to the rules.”
Smart Business spoke with Schuler about what business owners need to know about PCI compliance, and how to ensure your business isn’t breaking any rules.
What is PCI compliance?
PCI compliance is a standard that has been required by the credit card companies that defines the way that anyone who accepts a credit card has to protect that card information. It is a very specific standard that outlines all of the data protection requirements, as well as the physical security requirements and all types of other issues as they relate to security, with the end goal of making sure the card information is protected.
Regardless of whether you are a small, one-location business or a national retail chain, everybody is bound by the rules of PCI compliance.
Why is it important for companies to be compliant?
The first reason it is important is because if your systems are hacked, and you are PCI compliant, the chances of the intruder being able to get to some of your protected credit card information is quite slim. If you follow the security protocols outlined in the compliance standard, you should be all right.
Now, if you are not following the rules in terms of protecting that credit card data, you probably won’t be as lucky. For example, if your point of sale system that collects credit card information does not encrypt the swipe data, then that POS system is more easily compromised and hackers would be able to take all of that data.
What will happen in that situation is the credit card companies will be able to link the breach to you, because they have very sophisticated software programs that track where the breach happened, and narrow it down to a single location at which a credit card was used. When they collect all the different cards that were part of the breach, and they see that all the cards had one thing in common — this particular location on this particular day — you’re in trouble.
What type of trouble is possible in the event of a breach?
‘Trouble’ involves being fined by the credit card companies. There are different levels of PCI compliance to which companies must adhere. The compliance goes from level 1 to level 5. A small mom and pop store will be at level 5, because they are not collecting a ton of credit card information. A national retail chain or eBay will be at level 1.
However, if your company is at level 3 and the company is subsequently hacked, you immediately have to build up to the security protocols of a level 1 company. And the necessary work to put in those most stringent security protocols is astronomically expensive.
Why should companies pay attention to this issue sooner rather than later?
Cyber crime is on the rise. On a go-forward basis, it is just going to keep becoming more of an issue. More and more companies are getting hacked. That is the reality. There are hacking toolkits out there that make it easy to hack companies. More and more companies are having their credit card information stolen from them. If your company is taking credit cards, it’s your job to protect the consumer and not share that information with anyone else. If you are hacked, the credit card company will find out about it and it will be expensive.
Also, if you don’t comply with what the credit card companies are asking of you, they will make it so you can’t take credit cards anymore.
How does a company know what level of compliance it must reach?
Anyone who accepts credit cards has received a self-assessment questionnaire from the credit card company. The credit card companies will tell you, based on volume and other various factors, what compliance requirements are necessary for you.
What steps should be taken to ensure compliance?
The first and best step is to hire a company that understands PCI compliance to come in and assess your computing environment to determine if you are in or out of compliance. If you are out of compliance, an assessment will help you determine what steps are necessary to regain compliance.
Next, going through that self-assessment questionnaire on your own or with your information technology team, because a lot of the questions are IT-related, will give you a good idea of your current compliance status.
If you’re going through the questionnaire and it asks a bunch of technical questions like ‘Do you have a firewall in place that segregates your network traffic?’ and you keep answering no, it is probably pretty likely that you have some work to do. The questionnaire can provide a good indicator of whether your company is compliant or not.
Zack Schuler is the founder and CEO of Cal Net Technology Group. Reach him at ZSchuler@CalNetTech.com.
Rising health care costs are putting more and more pressure on employers every year. Providing a desirable plan has become an enormous expense, but companies still need to offer health insurance benefits to stay competitive and recruit.
“Health insurance is no longer an employee benefit; it’s a cost of doing business,” says Albert Ertel, COO of Alliant Health Plans. “You have employers trying to find a balance between what they can afford and what the employees desire.”
Smart Business learned more from Ertel about how employers can find that balance.
What options do they have to keep the costs manageable while also offering a quality benefits program?
One of the mistakes employers make is looking at their health plans on a year-to-year basis instead of using a long-term, multi-year approach. There used to be 10 to 15 insurance companies employers could get quotes from that would compete for their business. There are only a handful of competitors in the business now, and options tend to be homogenous. Companies don’t look at the true cost of changing carriers.
What should employers look for in a health insurance carrier?
They should look at the price point and the availability of services. One universal truth is that health care is local. Looking at the provider directory may not provide solutions. Look for a company that wants to work with you over the long haul. This opens the door to develop that multi-year or long-term approach. Too many people just say, ‘Here’s the low rate this year; it’s time to move.’ Disruption adds to the cost of changing carriers. Once you change carriers four or five times, you’ve gone full circle and not accomplished anything positive for your employees.
In the real estate market everyone looks at location, location, location. In the health insurance business, people have a tendency to be very short-sighted and look at rate, rate and rate. Health insurance is a product for which you truly get what you pay.
Besides price, what should employers consider when looking at health insurance?
The basics are the price, the benefits and the network that employers have a tendency to focus on. After those three factors, you should consider the true level of customer service, level of employee education, hands-on service and no-cost, value-added services guiding people to healthier decisions. If you only compare the basics, you’ll have a tough time differentiating one carrier from another. Although employees aren’t involved in the decision of where to buy coverage, every employer out there knows that a benefit is no longer a benefit if it’s a ‘hassle.’ I’m talking about picking up a telephone and talking to a person. You need a focused point of contact — those touch points that are truly hands-on, truly person-to-person.
Employers want to do the right thing for their employees. But the amount of information most employees know about their health insurance is printed on their ID card. That’s about as in-depth as they go until they need it.
How can employers educate their employees about their health insurance?
Let’s ask the right question: What do my employees really need versus what do they want? Most employers rarely ask. Now you’re providing value, so give them the opportunity to learn about what they’ve got. The annual enrollment period is a great time to educate and inform employees about their benefits. Unfortunately, a lot of employers just get an application filled out. But what does a new application mean to an employee and his or her family?
One idea that works well is to invite the employees’ spouses in for these meetings. Why? Seventy-seven percent of health care decisions are made by women. So involve the spouses.
What is the benefit of educating employees about the plan?
The biggest benefit is truly imparting the knowledge of the cost of medical care and the value of the insurance plan the employer is providing to them. Most employees don’t understand how much it costs. All they know is how much is being taken out of their check.
The other thing they know about the cost of their health insurance is the co-pay. If their doctor’s visit only costs them $20, then why is the company taking so much money out of their account? You have to help them understand their cost is only the tip of the iceberg.
What are some of the factors contributing to high costs?
When you look at the process of pricing health insurance for a company, you look at the demographics of the group: age, sex, family participation in the group, the plan design they are interested in, where they are located, the health of the group, whether it’s through claims experience or health histories. Then the bargaining starts. The risk is determined and benefits may be modified.
How can employers marginalize those factors?
I’m a big believer in personal responsibility. People want to work for employers that take the time, not just in an enrollment meeting, but with a truly educational total approach to employment and benefits. Large or small, the companies people want to work for are ones that give employees the tools to make their own decisions. If you give people responsibility, eight out of 10 of those people are going to rise to that occasion and many exceed it.
In the health insurance business, the best way to bring down costs is by being healthy. That is why preventive care and wellness programs are so important and need to be considered.
Albert Ertel is COO of Alliant Health Plans. Reach him at (706) 629-8848 or email@example.com.
Employers should be paying close attention to several new developments from the National Labor Relations Board, as these changes impact many more employers than people realize, says Lynn Outwater, managing partner with Jackson Lewis LLP.
“These new developments at the NLRB impact both nonunion and unionized employers,” Outwater says. “But a lot of employers are oblivious to the changes. Whether you are a small, medium or large employer, there are a lot of new developments you need to focus on and be prepared for.”
Smart Business spoke with Outwater about how the changes will affect employers and what steps you can take to ensure compliance.
What are the changes that employers need to be aware of?
There are four main developments. The first, which has gathered some media attention, is a new mandatory posting notifying employees of their right to unionize, which has to go up in the workplace on Jan. 1, 2012. Ignorance of the law is no excuse. It would be considered a violation of the law if there is no posting, with other legal implications.
In terms of what this may mean to employers, it is likely to increase the potential of union activity and/or increase protected concerted activity in the workplace, such as employees talking among themselves about their terms and conditions of employment in ways that may be protected under the National Labor Relations Act. This certainly can provide more exposure to possible unfair labor practice charges for employers.
Why is this posting such a big deal?
This is a significant development because since the statute went into effect in 1935, there has been no requirement for a posting. There is some pending litigation regarding whether the NLRB has the authority to do this, but employers can’t count on that litigation to protect them. They need to get up to speed on what they need to do, where they need to do it and how they need to do it. It’s not just a matter of putting up a poster.
Employers should be considering strategies and proactive compliance programs to deal with this subject. I would suggest that employers look at their whole labor relations plan. They need to decide how, when and where to post and if they are going to explain it to their employees in advance of the posting or in conjunction with the posting. They certainly need to train all their managers and supervisors about the legal meaning and requirements of the posting and make sure they have employment policies in place that ensure best practices prior to the posting.
What other developments should employers be aware of?
The NLRB has focused on the exploding area of social media issues and policies. The NLRB has more than 100 cases pending involving Facebook, Twitter, YouTube, or other forms of social media and electronic communications.
Because of this heightened scrutiny, it is very important for employers to make sure they have updated social media policies that are both lawful and effective in relation to their company culture. Also, they should ensure their policies are lawful based on recent or anticipated NLRB actions. Employers should avoid overly broad provisions that could be reasonably construed to prohibit protected concerted activity as currently interpreted by the labor board.
They should also look at other policies that can be implicated by these board decisions, such as employee access rules, communications with outside media rules, corporate codes of conduct, dress codes, confidentiality of investigations, nondisparagement and gossip policies, computer policies, etc. It’s a wide swath.
The third development is that the NLRB is seriously considering accelerating the timetables for union elections in the event that a petition would be filed at any employer’s work site. They are looking at reducing the amount of time from petition to election to within 10 to 21 days. They are also looking at requiring expedited disclosure to unions of employees’ contact information, including phone numbers and e-mail addresses. The significance of that is to make employers aware that these developments can result in either legal pitfalls or employers caught unaware by these fast-paced NLRB developments and find themselves not realizing how accelerated things are today.
The last thing employers should be aware of is a new case which would allow, in most industries, a union to seek an election in only one job title. For example, in one case, a union was allowed to go forward with an election with just certified nursing assistants, as opposed to an overall service and maintenance unit, or some larger group which otherwise shared a community of interest among various jobs.
What effect will these changes have, and how should employers handle them?
Essentially, this means unions can be more successful, more quickly and more easily. In view of all these new developments, employers need to review their comprehensive labor relations plan. Do you do things differently, or continue to do things the same way? Should you train management and supervisors? These developments are so significant that if your management team is caught unawares, you are more likely to have legal and practical difficulties.
How can employers ensure they aren’t caught unawares?
Part of it is having policies and practices that ensure lawful best practices in today’s environment. That includes reviewing handbooks and social media policies to comply with rapidly changing legal requirements. Also, employers must keep up to date on legal developments, so they can comply proactively instead of finding out later that they have committed an unfair labor practice.
Lynn Outwater is managing partner of Jackson Lewis LLP. Reach her at (412) 232-0232.
There are two things business owners need to know about the risk they face from third-party intellectual property lawsuits.
“First and foremost, companies need to realize the exposure exists; it’s real and affects all industries,” says Shane Moran, a vice president with ECBM Insurance Brokers and Consultants. “Many companies just shrug and believe they don’t have that exposure, they don’t deal with patent information, but it’s out there in every industry. Second, the cost to pursue or defend the allegation is extremely high.”
The growth of the Internet has raised a significant number of copyright and patent issues, such as implied licensing, linking, catching, framing and well as third-party content. Social media sites have created an unexpected exposure for companies, as well.
Smart Business spoke with Moran about how companies can protect themselves from third-party exposure.
What are the differences between first-party and third-party IP?
Generally, first-party IP is defined as the intangible assets of a company and its employees: patents, goodwill, knowledge, trade secrets, etc. Third-party IP is when you have infringed upon someone else’s IP and need to defend yourself. First-party is an offensive action, and third-party is a defensive action.
What can companies do to protect themselves from third-party copyright or patent exposure?
The first step is realizing you have the exposure. Next, companies must develop processes and internal procedures to minimize that risk.
Companies should utilize a strong risk management practice to help minimize IP risk. They should develop an IP compliance program that all of their employees are aware of, and are trained in. The program constantly needs to be reviewed and updated, because technology is always changing. Within their program, there needs to be procedures to evaluate this ongoing exposure, steps to verify that any information companies are utilizing is ‘out of copyright,’ or that they are taking steps to get permission to use the information they will be utilizing.
For it to work properly, the process and procedure should draw from many resources within the company. Legal, financial, product marketing — each department has to be involved in this program so that each department knows what is going on and to make sure you are not exposing the company. Once you’ve explored that process or procedure, the next step is to look at transferring the risk via an insurance policy.
There are several policies companies can look into, including infringement abatement coverage, patent defense-only policies, patent infringement cost reimbursements and standalone IP policies. It’s a rapidly growing section of the insurance marketplace. The terms and conditions of these policies are constantly evolving to adapt to the changes.
Why is it important to involve each department in the process, and how should they work together?
If you want to utilize third-party information, you are going to need to have your legal department vet that information. Typically, it is going to verify whether that information is still copyrighted or still patented.
Then you have your marketing department, which is creating whatever marketing strategy and platform it is going to implement. It will utilize the information the researchers found. And the financial department should be involved, because of the cost associated with everything.
Without those departments talking to one another, you could have the marketing department utilizing information that the legal department has found out is still copyrighted — information that the company hasn’t received permission to use. If you find out you have to pull an entire marketing program because you didn’t do a proper background check at stage one to find out if that information was protected, it becomes a pretty costly endeavor.
What types of information need to be checked to avoid third-party infringement lawsuits?
The easiest example scenario to consider would be an image or symbol that is patented. If you want to use the Nike Swoosh, for example, in your marketing materials, but you didn’t receive permission from Nike, you would be slapped with an infringement claim immediately.
Obviously everyone knows that symbol is copyrighted, but there are tons of symbols and acronyms out there that people have patented and utilized in their own materials. If someone else sees one of those patented items and just says, ‘I like that idea,’ and uses it without doing the research to find out that it is a protected symbol, you have a lawsuit on your hands.
What can companies do to ensure they aren’t liable for third-party IP lawsuits?
If you consider social media exposure, you want to make sure you have strong policies in place to limit or discourage the use of social media websites from company computers. The Facebook issue is a perfect example. Employees are posting information all the time on that site: images, links, etc. It’s a huge third-party exposure, but you can avoid it by creating a policy or procedure that doesn’t allow people to log on to social media sites from a company computer.
Most people now have phones with Internet capabilities, so they can use their phone rather than using the company’s property. A strong Internet policy certainly helps a company reduce its exposure.
Companies need to train their employees about this exposure and constantly recertify that training. Someone could publish information without realizing that information is copyrighted and still within its protective period, so there needs to be research done to make sure that the data being published have been properly vetted.
Shane Moran is a vice president with ECBM Insurance Brokers and Consultants. Reach him at (610) 668-7100, ext. 1237, or firstname.lastname@example.org.
Business owners have many choices when it comes to how to pay their employees. Some handle the payroll process internally, and spend a great deal of time managing all the paperwork of federal and state taxes, Social Security, Medicare, union dues, 401(k) contributions and more.
Some use payroll software, which allows accurate recordkeeping, but often has a long learning curve. Some hire a local accountant, or a professional tax lawyer/CPA.
Others outsource these tasks to companies that provide automated payroll services.
Smart Business spoke with Jim Geuther, Director of Business Banking at FirstMerit Bank, about what services to expect from payroll providers and how to ensure you choose the right one for your company.
Why is it important for a business to choose the right payroll provider?
Payroll appears to be pretty simple on the surface — employers calculate employees’ gross earnings, they deduct the respective payroll taxes and other ancillary deductions such as insurance or 401(k), they send the government their share and produce a payment for the net amount to the employee.
Payroll is actually more complicated than this. There are bonuses, sick time, overtime and other factors that can change from pay period to pay period, affecting compensation. In addition, federal, state and local taxes are always changing and, depending on the complexity of a payroll, the time it takes to keep track of all of these changes can turn it into a daunting task.
If employers aren’t up to date on payroll tax requirements such as rates or frequency of payments and filings and they miss a deadline or pay an incorrect amount, they can be fined. In addition, these errors can lead to an inaccurate payroll and, ultimately, unhappy employees. That’s why it is so important to do it correctly.
How can an outsourced payroll provider benefit a business?
With payroll being a much more complicated task than it appears, businesses need someone they can count on for more than just paycheck calculations. Entering all that data and pushing out a check is the easy part. It is everything else after the fact that becomes difficult.
FirstMerit’s Business Online Payroll, for example, provides payroll tax payments and filings as well as 100 percent liability that payroll taxes will be paid and filed accurately and on time.
Offering direct deposit saves time and money for the employer and employee, because there are no checks or check stubs to print and the employees don’t make an extra trip to the bank on payday, so their time is spent focusing on business productivity.
With most in-house accounting products there are additional costs for keeping the technology up to date and tax tables current. With an outsourced payroll provider, there is no software to purchase, no need to have personnel maintain it and no ongoing fees to keep current.
Having an employee do in-house payroll presents a risk of knowledge walking out the door if that employee leaves the company. There is no need to have an ‘expert’ in house with an automated payroll service.
How can business owners determine which payroll provider would be the right fit for their company?
There are many factors that go into determining the best solution when it comes to payroll. The five most important factors are reputation, customer service, ease of use, ability to grow with the company and, of course, cost.
Businesses need to look at the complete picture when deciding on a payroll provider. Working with a small local payroll provider can present issues with out-of-state calculations and few, if any, offer any liability or guarantee with their service. However, working with a payroll provider that has a proven track record of success and growth offers peace of mind to the business owner.
Businesses should look for a payroll provider that has been recognized and awarded for the customer care it provides and can answer questions and provide solutions to problems. Also, look for a payroll service that provides live support available at one number, eliminating all the shuffling around and waiting for a call back.
With the many options available for payroll services, ease of use is one of the most important factors for business owners. FirstMerit provides an award-winning online product that allows business owners to run their payroll from any Internet-capable device. Employers simply log in to their online account, enter hours and other specific payroll information, preview the payroll to ensure data is correct and press ‘approve’ — everything else is taken care of. Processing payroll this way takes about five minutes.
Another important factor to look at is whether the provider can grow with the business’s future needs. Finally, businesses should consider the cost of working with a payroll provider. One of the major advantages of working with an all-inclusive provider is that there are no hidden costs for direct deposit, reports and payroll tax payments and filings. Our online technology significantly cuts operational costs, and those savings are passed on to our customers. Some customers pay half the cost charged by larger companies, accountants and CPAs and most local providers.
Jim Geuther is Director of Business Banking at FirstMerit Bank. Reach him at (216) 694-5683 or email@example.com.
In every business’s growth plan, performance goals are set for specific business units with corresponding resource budgets allocated to support the plan. It used to be assumed that anything “tech” was under the purview of the IT department. So responsibility for building and maintaining the first corporate websites naturally evolved in the IT area.
“As digital tactics have become major channels in business marketing today, key ‘tech’ performance requirements have shifted,” says Kevin Hourigan, President and CEO of Web design, Web development and Internet marketing agency, Bayshore Solutions. “A critical element in today’s business growth plan is to make sure resources, ‘ownership’ and accountabilities are properly aligned when it comes to your website.”
Smart Business spoke with Hourigan about how to align the accountability and ownership of your business website to bring your business its best results.
Who should 'own' my business website?
Companies excel when marketing generates leads and sales. Increasingly, this lead generation and customer acquisition is accomplished by leveraging the company website as a tool, a facilitator, or a direct driver of results.
Businesses that are not using their website to its fullest potential as a lead and sales generator are missing out. It is only a matter of time before not addressing the situation will allow competitors to pass you by, and put you out of business.
For most businesses, website results expectations have transitioned from the IT realm to the marketing realm. If you are expecting marketing to deliver web business results, then marketing has to have the ownership to enable their accountability
How does IT technical expertise contribute?
The technical knowledge and skill base of IT and Marketing professionals is still an “apples and oranges” type of scenario. However, the skill sets of today’s digital marketers and IT professionals are closer than in the past, such that they can coexist, communicate and complement each other on the same corporate team, in pursuit of the same company goals: leads, sales and growth. Most marketers are not tech experts. IT professionals aren’t typically marketing experts. However, because of the very technical nature of digital marketing, a good relationship between IT and marketing needs to exist to ensure successful web results.
Marketing will be best at the dynamic and continuous iterations of market messaging, content and design that drives digital channels including online advertising, web page optimization, content marketing, and social media marketing and integration. An essential tool to enable your marketers to “market” your website is a Content Management System (CMS). This tool facilitates quick and easy messaging, styling, and implementation of proper coding for tracking, analytics and user experience functionality.
IT is best positioned to set up and deploy the infrastructure of your business website to help it optimally deliver the results that marketing (and you) expect to gain from it. IT support for a business website is often essential in implementing the recommendations of webmaster tools and other website monitoring discoveries. These include implementing ongoing redirects that avert SEO error penalties in the search engines, preventing hacking attacks and spamming to your site, and seamless handling of website stress loads (like ensuring the bandwidth to allow thousands of holiday shoppers to purchase through your website shopping cart simultaneously.)
How do I bring this all together?
Unfortunately, I have seen marketing and IT divisions within organizations that are non-communicative and even adversarial. A common factor I see in these instances is a perspective of territorial resources, misaligned expectations and communication barriers.
I have also seen many examples of great collaboration between IT and Marketing arms of a business that uncover opportunities for educating each other on the dynamics of their respective specialties, and discover ways to implement better, track better, interpret metrics better and produce much greater business results though best utilizing each other’s talents.
Executive clarification of the lines of responsibility, creation of the resources to fulfill that responsibility and enabling the means for cross-functional communication with IT and Marketing will improve your business results. Often a business may find that it is not able to quickly or economically accommodate the time or staff necessary to synergize IT and marketing with respect to driving website results. This is where partnering with a firm that specializes in digital marketing (and is fluent in the technical language involved) can alleviate overhead costs and streamline the integration of technology and marketing that brings next-level business results from your website.
In my experience, I have seen that businesses who are getting the best web results have assigned website accountability to marketing, and have forged a synergistic relationship between marketing and IT. This relationship allows IT to help evaluate, set up and implement the tools that marketing needs to produce great results. It also alleviates a burden on IT to keep up with the constant flux of digital market dynamics and focus on the IT infrastructure central to the business. Most importantly, the relationship provides for the communication and cross training that assures mutual understanding of each team’s processes and contribution to the company’s goals.
Assigning responsibility and resources for website presence and performance to your marketing team will free up your IT team to better focus on the infrastructure management items that are mission critical to operating your business. A healthy IT-Marketing relationship and the right tools for the job will allow your marketing experts to use the best digital marketing techniques to grow your business.
<< For a snapshot of Bayshore Solutions Web marketing methodology, visit: http://www.BayshoreSolutions.com/method
Kevin Hourigan is the president and CEO of Bayshore Solutions. Reach him at (877) 535-4578 or www.BayshoreSolutions.com.
As your business grows, so will your technology needs. As you’re considering upgrades, it’s important to be aware of all the options available and choose the solutions that can grow with your business and help keep things running productively and seamlessly.
On the telecommunications front, that solution might be Primary Rate Interface, or PRI. PRI is a voice service that is a great solution for a small business with 10 or more employees. Instead of needing a separate line to handle each call, PRI allows up to 23 channels to communicate simultaneously across one single line, says Anthony “Clay” Catinella, director of sales for Comcast Business Class, Atlanta region.
“PRI makes a lot of sense for a growing business that needs a scalable solution managed to their busy schedule,” Catinella says. “The Comcast Business Class PRI solution allows businesses to add channels simply by placing a quick phone call. Many times, no technician or appointment is needed.”
Smart Business spoke with Catinella about how PRI technology works and how to determine if it can help your business.
What are the advantages to PRI technology?
The biggest advantage is flexibility when it comes to how businesses organize their voice service. Businesses with a PBX could start with as little as six channels and could easily add more as the business grows with very little impact, and no additional telephone lines to install.
Another benefit to PRI, especially as you move into a larger business environment, is direct inward dialing (DID). This technology enables businesses to give clients telephone numbers that can be routed directly to employees’ phone extensions instead of through a receptionist or by calling the main number and entering an extension.
What types of businesses could use PRI service?
Any business with at least 10 employees should really take a look at this voice technology. When you have that many employees and you’re looking to meet your voice needs with individual lines, it can start to get very expensive. PRI can help ensure you are giving your employees enough access to outgoing lines when they are needed. It allows clients to reach an employee extension directly, and it offers a simple solution to upgrade voice service as the business grows.
What is involved in the upgrade process?
Once the circuit has been installed, all it takes is a quick call to your service provider to activate a few more channels on the circuit. That activation will give you additional call paths that you can distribute or set up however you like within your business. It shouldn’t require any technician to come onsite, and it requires very little waiting time between when an order is placed and when it can be delivered.
In what situations does PRI provide a competitive alternative to traditional telephone service?
PRI certainly is a great option if a business expects to grow quickly or if it has already invested in voice hardware, such as a PBX phone switch, to best take advantage of existing resources.
PRI also can provide an advantage over traditional telephone service if a business requires the flexibility of changing how its voice service is configured, or if it wants the ability to bypass having a receptionist who routes calls to employees.
What kind of benefits can companies expect from this technology?
If you expect your small business to grow, PRI service helps to meet the needs of your business as you grow.
For companies that are already looking at PRI service and determining the best option, it’s important to consider the whole package. Companies are rarely purchasing voice service without data service. When you pull data into the conversation of whether PRI is right for the company, customers with PRI service typically also have data service over a T1 connection. Today, for a cost similar to a PRI and a T1 circuit for data, you could get a PRI and a 100 megabit cable modem with download speeds up to 64 times faster than a T1 line.
That’s where you could see increased productivity for your employees. You really start to see advantages in terms of the amount of resources necessary to manage the day-to-day business.
Anthony Catinella is director of sales for Comcast Business Class, Atlanta region. Reach him at (770) 559-2132 or Anthony_Catinella@cable.comcast.com.