Legal Issues and Recent Developments, Published by the Lurie Law Firm LLC

Tips for Conducting an Effective Investigation

In my experience representing both employers and employees, as well as having conducted numerous investigation, I have found that litigation often arises when employees feel that their employer does not — or will not — take their complaints seriously, and that a court of law is their only recourse.  In addition, our courts have held that employers may avoid liability for sexual harassment and other complaints if they conduct a good faith, prompt and thorough investigation. Put simply, a prompt and thorough investigation is good business and good law.

While the need for conducting an investigation is clear, a poorly executed investigation can be disastrous.  Rather than address the problem, it may exacerbate it if the employee feels that his or her concerns was not taken seriously.  If the complainant feels that they have somehow been punished for raising these concerns, this may also lead to a claim of retaliation.  Moreover, an inadequate investigation may chill other employees from complaining, resulting in long-festering problems and additional lawsuits.  Finally, a jury might regard an inadequate investigation as a “whitewash,” leading to potential significant liability.

Here are some tips in how to conduct an effective investigation.

  1. Plan for an Investigation Before a Complaint is Raised.  Make sure that your employees know that they can complain and how to do so.  Make sure that your anti-harassment and discrimination policies provide contacts for complaints; for organization of any significant size, there should be multiple individuals, and not just supervisors, who can receive complaints.  Employers should also make sure that this information is covered in training.  If you have a hotline or helpline, this information should also be conspicuously posted.  (It should also be noted that New Jersey employers are also required to post, and annually distribute, information about employee’s rights under the Conscientious Employee Protection Act.)   Employers may also want to consider developing an investigation policy and procedure, including types of issues to be investigations, sources of complaints, identification of investigation leads, the conduct and method of an investigation, when to notify management of the investigation, responsibilities for corrective action, and other issues.
  2. Determine Whether to Conduct an Investigation.  Employees may raise issues, and then ask that you do nothing.  Or you may believe that an employee is simply venting, rather than asking for assistance.  Other times, you may believe that the employee is simply disgruntled, and that they are just trying to raise issues to salvage their job.  You might also think “I’ve heard all of this before, and I’m not going to waste my time on investigating this.”   In each case, you should carefully consider — and re-consider — any decision not to investigate.  It is usually more prudent to investigation than to try to explain why an investigation was not conducted.  Further, as noted above, a prudent employer might want to consider adopting policies identifying who should ultimately make the decision as to whether or not to investigate. 
  3. Decide Whether Any Action is Necessary While the Investigation Proceeds.  Depending on the nature of the allegation, and the anticipated time to complete the investigation, you might want, or need, to take some interim action.  For example, an employer may need to immediately address an allegation of unsafe working conditions, embezzlement or employee violence.  Similarly, a prudent employer might want to take some immediate (albeit temporary) action if there are egregious claims of sexual harassment by an employee against his or her supervisor.   
  4. Decide who Should Conduct the Investigation.  Clearly, an investigator should be impartial; targets of the investigation, and witnesses, should not be involved in conducting or overseeing the investigation.  Employers might also consider hiring an outside investigator, particularly where the allegations concern senior management or are politically sensitive.  In any event, in addition to being impartial, the investigator should have an open demeanor and be able to put the complainant and witnesses at ease; investigations should rarely be conducted as cross-examinations, and should certainly never signal that the investigator has already reached a conclusion, and is merely trying to uncover evidence to support that conclusion.  In addition, the investigator may be called as a witness, and employers may want to ensure that the investigator is articulate and credible.  It is also often a good idea to have two people present during the investigation, as this will allow one person to focus on the questions and answers, while the other documents the conversation.  It is also often helpful to have a second set of eyes and ears, both to observe the credibility of witnesses and to make sure that all appropriate ground is covered, as well as to corroborate what was said in the event of a later dispute.
  5. Consider Conducting the Investigation under Attorney-Client Privilege. The complaint should be reviewed carefully to determine if there are any potential legal issues or liability lurking.  If so, employers may want to consider having the investigation, at the outset, conducted at the request of an attorney, to try to protect the investigation to the fullest extent possible, as it may be difficult to assert the privilege later.  Regardless of whether or not it is conducted under privilege, however, I have found that every investigation should be conducted with the understanding that it might see the light of day, and the investigator should feel comfortable defending the investigation and its conduct.  
  6. Plan the Investigation.  Sloppy, haphazard investigations should be avoided.  The investigator should have a relatively clear grasp of the allegations, and should plan the investigation accordingly.  It is usually wise to start with the complainant, and delve further into the facts, including identification of documents and witnesses.  Witnesses should be prioritized, based on their level of involvement and claimed knowledge of the facts.   
  7. Obtain, Review and Preserve  all Relevant Documents. Investigators should make sure that they ask for, and obtain, any relevant or supporting documents, including handwritten notes, diaries, calendars, e-mails, expense reports, tape recordings and personnel documents.  It is always better to discover all facts during an investigation than to be surprised by additional evidence at litigation. It is also critical to preserve all documents and information, in the event of a litigation or the results of the investigation are questioned.
  8. Remind the Complainant and all Witnesses of the Non-Retaliation Policy.  The law generally prohibits retaliation against employees who complain of discrimination or harassment, or who participate in such complaints.  Prudent employers will likewise have a strong non-retaliation policy, stating that there will be no retaliation against anyone for raising a complaint in good faith.  At the beginning of the interview, complainants and witnesses should be re-assured that the company takes the non-retaliation policy seriously, and they should be encouraged at the end to let the investigator know if they believe, at any time, that they have suffered any retaliation.  Supervisors should likewise be reminded that the company will not tolerate any retaliation against the complainant or witness.
  9. Remind Employees of Confidentiality, and do not Promise Anonymity.  Complainants and witnesses should be reminded that, in order for the investigation to be conducted appropriately, everything must remain confidential; neither the complainant nor any witness (particularly the subject of the investigation) should tell anyone else what was said during the investigation, and they should certainly not ask anyone to corroborate or support them.  Complainants and witnesses should also be informed that, while the company will try to keep their identity anonymous (if they so choose), this cannot be guaranteed, as this information may be discernible or may need to be divulged in order for the investigation to proceed.
  10. Follow the Investigation Where It Leads, But Beware of Scope Creep.  During the course of an investigation, new facts and allegations may be discovered.  Employers ignore these at their peril.  Once an employer is put on notice of potential claims, it may not simply ignore them because they were not part of the initial complaint or investigation.  On the other hand, too often investigations are never completed because of investigation of tangential or unrelated issues.  If new, but unrelated issues need to be investigated, employers may want to consider instituting a second investigation. 
  11. Prepare a Written Investigation Report.  At the conclusion of the investigation, the investigator should prepare a written report, summarizing the allegations (including the date the complaint was raised), how the investigation was conducted, relevant policies and procedures, key factual findings, and a notation of inconsistent or conflicting information.  Employers should bear in mind that the written report, as well as all documents collected or created during the investigation, may be subject to discovery in the event of a lawsuit.  Accordingly, all documents and drafts should be maintained in accordance with the employer’s record retention policies.
  12. Keep the Complainant Informed.  The complainant should be kept informed of the progress during the course of the investigation, should be notified shortly before the investigation is concluded (and asked if there are any additional facts that they wish to bring forward) and then again at its conclusion to let him or her know that the investigation is concluded and that appropriate action will be taken.  Depending on the specific facts, the company may want to give the complainant more or less details about the corrective action.
  13. Take Appropriate Corrective Action. Corrective action needed should be tailored to the specific situation, including a root cause analysis of the problem. Appropriate action can range from no action, to training, discipline (up to and including termination), and creation or revision of policies.
  14. Touch Base with the Complainant.  Depending on the situation and resolution, the employer might consider touching back periodically with the complainant, to make sure that there has been no retaliation and that the corrective action has been effective. 
  15. Track for Trends.  Companies should periodically track for trends, including trends concerning a department, a geographic location or type of issue.  If trends emerge, the employer should consider further corrective action, including additional training, monitoring or policy creation.

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