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| FAQ: Risk Management |
The following information is adapted from APA’s (1993) Legal Risk Management: A Guide for Volunteers and Staff of the American Psychological Association.
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1. What is the purpose of risk management?
Risk management policies and practices help entities like Division 17, as well as the individuals who volunteer their services, to avoid violations of the law and protect them from legal problems that may interfere with their goals and objectives.
2. While I understand that the American Psychological Association (APA) must be concerned with liability issues, how is Division 17 affected?
Actions attributable to Division 17 that cause legal problems adversely affect the Division, its officers and members in a variety of ways, including involvement in litigation and diversion of resources from the Division’s mission. Furthermore, all groups associated with APA – staff and volunteer governance personnel, Council of Representatives, Board of Directors, boards, committees, Central Office and DIVISIONS are considered integral components of the Association. Even Divisions that are incorporated separately are considered components of APA and, therefore, potentially agents of APA for legal purposes.
3. How concerned should the Division or I, an officer or representative of Division 17 be about risk management?
Actions by the officers, staff and designated representatives of Division 17 are considered actions of the Division and also of APA. Thus, whatever we do as a Division or a representative of the organization’s activities can be imputed to be that of the Association for legal purposes. If legal action is taken against the Division and APA, it is also possible that individual officers or representatives would be sued. APA indemnifies Division officers and representatives who are acting within the scope of their duties and also provides insurance for Division activities. It is important that Divisions keep APA informed as soon as Division officers or representatives learn of any risks or problems. Also, it is essential that the Division’s annual report to APA provide all of the information that is required by APA Rule 100-1.2.
4. What are my responsibilities as an officer or someone in a leadership position of Division 17?
As a representative of Division 17, all of us should always act in the best interests of the division and make sure our actions conform to the risk management policies. As a constituent part of APA, the Division also owes a legal duty to the Association to conform to the law, to follow APA policies and to act consistently with APA’s best interests.
5. Can APA or a Division be held responsible for the actions of its members even when they do not know about, approve of, or benefit from activities?
Yes. This falls under the category of “apparent authority”. As long as volunteers or staff appears to outsiders to be acting with the association’s approval, the U.S. Supreme Court has determined that a professional association is liable for antitrust violations arising from volunteer activities. This can also be the case for all other legal violations, including the tax laws, formation or breaches of contracts, copyright or trademark violations, defamation, etc.
6. As an officer or member, how do I find out about risk management responsibilities?
There are two ways to obtain information about risk management. First, see the APA publication Legal Risk Management: A Guide for Volunteers and Staff of the American Psychological Association that can be obtained from APA Headquarters. Second, any time you think that there might be even a remote possibility of a legal problem; the APA General Counsel’s Office should be contacted. The sooner the General Counsel’s Office learns of any possible legal problems, the better the chance that they can be avoided or minimized. The GC Office is staffed with able and experienced attorneys who are there to help all of APA, including Divisions, minimize or solve legal problems. The President of the Division should also be informed of any legal concerns.
7. What aspects of Division 17 are affected by risk management issues?
Division 17 is one of the more complex divisions within APA. Our officers definitely need to be aware of their legal and ethical responsibilities, but so do our Special Task Groups (STG), Sections, Special Interest Groups (SIGs), Student Affiliates of Seventeen (SAS), Committees, liaisons, observers, monitors, editors (The Counseling Psychologist, Website, and Newsletters), and others affiliated or sanctioned by the Division.
8. What are some examples of Division 17 activities that have risk management implications?
The range of activities is truly great and extensive. Public statements by officers or representatives of the Division, policy stands, workshops or conferences we conduct, endorsement or sponsorship of events, what we publish in official outlets including our website, discussion listservs, and even the newsletters of SIGs may have legal consequences and are governed by Association Rules, which in part are designed to minimize adverse legal consequences. Thus, we encourage our Sections, STGs, SIGs, SAS, and other affiliated groups to take special care in monitoring their publication outlets responsibly and act in accordance with risk management guidelines and Association Rules.
9. Can you be more specific about the inclusiveness of risk management with regard to public publications and statements?
Any prospective publication or statement that explicitly or implicitly concerns a particular individual, entity, product, or service raises a potential defamation issue. This is especially true if the publication or statement has a derogatory meaning. It is also essential that Divisions keep in mind that the APA Bylaws, in Articles VI.5 and 7, require that the Division and any chapters or sections may not make statements, or undertake any activity that does not fully comply with APA Bylaws, Association Rules and current APA policies. Where APA has adopted a policy on a topic, Divisions are restricted in the extent to which they can publicly disagree with that policy. For guidance on these issues see APA Bylaws Art. VI.5 and Association Rules 30.8 and 100-1.5 and contact the APA Division Services Office (202-336-6022). Conformance with APA’s governing documents and current policies avoids an array of legal problems.
10. If I am acting on behalf of Division 17 like being a SIG Newsletter editor, should I send drafts to officers to make sure they do not place the division at risk?
The answer is generally “no”. We trust that most members of Division 17 will exercise good common sense in what they publish and that our representatives will do likewise. Most of us are able to distinguish between “risk” and “minimal risk” statements and stands. Besides, to have an officer like the President check and monitor everything is overbearing and impossible. When, however, you have questions about a potentially risky situation, it is always best to play it safe.
11. Do you have suggestions of how to minimize the risk of defamation?
Yes, try to avoid or minimize “derogatory meaning”. APA suggests some steps in monitoring publications:
- Can the statement be avoided?
- Can it be made without the derogatory meaning?
- If it must be made, can it be done without identifying the “entity”?
- If derogatory meaning is conveyed, make sure it is to the smallest audience consistent with the goal.
- Insure the statement is true and not misleading.
- Be alert to those sources with animosity or suspect motives.
- If in any doubt APA legal counsel is available.
12. What are the legal risks associated with “advice” and “endorsements”?
Generally, they fall under two categories: advice on matters of safety and direct or implied endorsements. In the former, for example, guidelines, standards and directions on the practice of psychology which arguably proved to be inaccurate, dangerous and damaging place the division and APA at risk. It is for this reason that any document that could possibly be construed as guidelines or standards must be reviewed by the APA General Counsel Office and will usually be subject to review and approval by the APA Board and Counsel pursuant to APA Rule 100-1.5. In addition, endorsements for which the division receives any payments could have negative tax consequences – such payments may be subject to taxation. Where there is a payment or not, an endorsement carries the potential liability if the product or service is ineffective or harmful. Thus, the APA General Counsel’s Office should be consulted prior to any endorsement.
13. What is 501(c) (3) of the Internal Revenue Code and why is it important to APA and Divisions?
APA holds tax-exemption status under Section 501(c) (3) of the Internal Revenue code and it is the most favorable tax status available to any United States organization. This favorable status, however, comes with restrictions on the organization’s activities. A violation of any of these restrictions by APA or a Division can result in the loss of the tax-exempt status.
14. What activities are affected by this status?
Section 501(c)(3) status requires that the primary activity of the organization must be focused on subjects such as psychology as a science, psychology education and the benefits that psychology can provide to the society and the public interest. Promoting the common business interests of members is not an appropriate activity for a 501(c) (3) organization. This tax status also bars any part of APA from engaging in any activity that supports or opposes, in any way, the election of any candidate for public office. There can be no contributions to any candidates, no endorsement or opposition or any other activity that in any way might be construed as supporting or opposing a candidate for a federal, state or local office. This prohibition is absolute and there can be no exception. Lobbying in support or opposition of legislation or regulations is a permitted activity. However, lobby activity by 501(c) (3) organizations is governed by a formula that places severe limitations on the amount of money that may be expended for lobbying. The Federal Government also requires entities or individuals who lobby to file periodic reports describing their lobbying activities. The APA General Counsel Office should be contacted before the Division engages in any advocacy or opposition of legislation or government regulatory decisions.
15. What other areas of Division and APA activities should I be aware of for risk management purposes?
They are too numerous to list on a website, but include practice matters (fees, licensing, and modes of practice), publication and copyright matters, confidentiality, ethics, accreditation and approval, specialization and certification, and membership. We encourage all officers and representatives to become conversant with risk management guidelines of the American Psychological Association.
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