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

Posts Tagged ‘investigation’

Employer Loses Disability Discrimination Claim Due to Medical Opinion Based on Failure to Investigate

Thursday, April 1st, 2010

In an unpublished decision by the New Jersey Appellate Division today, the court affirmed a finding that a school district unlawfully failed to reinstate a teacher who took a psychological disability leave after he was accused of improper comments and behavior.  Ponsi v. Cliffside Park Board of Education, Docket No. A-5902-07T2 (Apr. 1, 2010).  On May 23, 2003, John Ponsi, a teacher at Cliffside Park High School, was unexpectedly called into the principal’s office for a meeting with two students, who accused him of making racial and lewd remarks earlier that week.  Another teacher was also at that meeting, who accused Ponsi of pushing her that same week.  Four days later, the Board of Education notified Ponsi that he was suspended with pay, pending the outcome of an investigation and psychological examination.

Contrary to the notice, the Board did not conduct an investigation.  Ponsi did, however, see his physician, who referred him to a psychiatrist due to depression and anxiety resulting from the accusations and suspension. In September 2003, Ponsi was also evaluated by Dr. Meyerhoff, a psychiatrist appointed by the Board, who concluded that Ponsi was unable to teach for the foreseeable future.  As a result of that examination, the Board notified Ponsi that he was ineligible to teach until he provided proof of recovery and that, if his absence exceeded two years, his employment would be terminated.

On January 31, 2005, Ponsi’s psychiatrist provided a written report, finding that Ponsi’s depression and anxiety had sufficiently abated and that that he could return to teaching.  The Board then had their initial psychiatrist  re-examine Ponsi.  The psychiatrist agreed that Ponsi’s depression and anxiety had abated, but found that Ponsi should not return to work, because he showed no repentance or remorse over the alleged lewd and racial remarks, or the pushing incident.  Dr. Meyerhoff wrote:

Though Mr. Ponsi is ready to return to work and, in theory is less overtly troubled and distraught than previously, he is not repentant about the previous school problem, offers no additional information which would logically explain why a teacher and two students, in effect, conspired against him, and conveys an astonishingly comfortable, serene and tolerant attitude as he, veritably, would accept reinstatement in school, without care or concern. Probably, with the aforementioned sense of self righteousness he could stand before  a classroom for days or even weeks, but it is likely he would unravel, at some point. If the Cliffside Park Board of Education seriously wishes to reinstate him, it is not unreasonable that he be re-interviewed, as a “returning” employee, by the same administrators he suggests have been incompetent.

Although the Board had conducted no investigation, its psychiatrist accepted all allegations against Ponsi as if they were true and, based on this assumption, decided that the Board should not reinstate Ponsi.  The Board, knowing that it had conducted no investigation, and that the allegations had not been proven, agreed with its psychiatrist’’s evaluation, and decided not to reinstate Ponsi.

Ponsi then retained a second psychiatrist.  This psychiatrist disagreed with Dr. Meyerhoff, who

diagnosed a delusional disorder, because Mr. Ponsi was not repentant, offering no additional information to logically explain why a teacher and two students would have conspired against him . . . Mr. Ponsi does not use the term, “conspiracy,” with me. I do not discern any paranoid delusions. His account of the accusations made against him is plausible and does not appear to be delusional. He raises reasonable doubts as to the validity of such allegations for which he cannot honestly express remorse or logically explain. In my view, this cannot be held against him. Since he is not delusional, I cannot agree with Dr. Meyerhoff that he will “unravel” at some point when teaching in a classroom.

The Board nevertheless decided not to reinstate Ponsi, and still did not investigate the underlying accusations against him.

After an evidentiary hearing, the Division on Civil Rights found that the Board violated that Law Against Discrimination by failing to offer a reasonable accommodation for Ponsi’s disability.  The Appellate Division affirmed this ruling.  The court noted that it was clear that Ponsi had a disability.  Further, as the Division on Civil Rights found that Ponsi’s experts were more credible than Dr. Meyerhoff, the court found that Ponsi established that he was qualified to return to work.  The court also reasoned that, once Ponsi claimed that he was entitled to reinstatement, the Board was obligated to engage in an interactive process, to determine whether Ponsi could return and, if so, whether Ponsi needed any reasonable accommodation.  As the court observed, the Board did not even bother investigating the allegations, even though itknew that its psychiatrist’s opinion was based entirely on the assumption that the allegations were true.  The court summarized, “If Dr. Meyerhoff’s assumption that the allegations against Ponsi were true is discounted, his diagnosis supports Ponsi’s reinstatement. Furthermore, the Board did not even follow Dr. Meyerhoff’s recommendation that Ponsi be interviewed, a clear signal that they had no intention to reinstate him.”

There are several lessons to be learned from Ponsi.  First, depression and anxiety may be considered protected disabilities, even if they are caused by job-related stressors.  Second, while it is understandable that the Board might have been reluctant to call Ponsi in for an investigation while he was on leave suffering from depression — and may have had difficulty conducting an investigation into a few remarks two years later, when Ponsi was able to return — employers that do not investigation allegations, and who rush to judgment, do so at their own peril.  Third, employers that retain their own doctors to examine employees should take care to ensure that accurate and objective information is being provided.  Fourth, if there are clear factual errors, or internal inconsistences, in an examination, the employers should not blindly accept the report and its recommendations. 

A copy of the decision is on file with the author, and is available on request.

New Jersey Court Reaffirms that Internal Investigations May Be Discoverable

Tuesday, March 30th, 2010

A few weeks ago, I posted tips for conducting an effective investigation, noting that a good investigation can be an employer’s best friend, but that an improperly conducted investigation — and lack of follow up — can be a nightmare for an organization.   See here for more information.  A recent New Jersey trial court decision, Shanahan v. New Jersey Transit Corporation, reaffirms that such investigations are discoverable, such that employee litigants, and possibly juries, may have the opportunity to review and criticize the employer’s investigation and follow up.

In Shanahan, the plaintiff alleged that her employer, New Jersey Transit Corporation (NJT), subjected her to a hostile work environment based on her sexual orientation, and then retaliated against her when she complained about the harassment.  To support her claims, the plaintiff demanded that NJT turn over four documents that contained a discussion, analysis and recommendations regarding the rise in discrimination complaints under the tenure of plaintiff’s supervisor, as well as data comparing disciplinary actions against white males and minority members, and data regarding trends in hiring of female officers.  The court held that that these documents were clearly relevant, as the documents may have a tendency to prove or disprove that plaintiff’s supervisor had discriminatory motives, as well as to disprove the employer’s reasons for its actions against plaintiff.

After finding that the documents were relevant, the court then held that the documents were not privileged.  More specifically, NJT argued that the documents were protected by the “deliberative process privilege,” which allows governmental agencies to withold documents that reflect advisory opinions, recommendations, and deliberations to help the agency formulate policies and decisions.  The court rejected this argument, ruling that the deliberative privilege does not apply in employment discrimination cases.  In reaching this result, the court cited Payton v. New Jersey Turnpike Authority, 148 N.J. 524 (1997), in which the New Jersey Supreme Court specifically held that investigations of  discrimination complaints are not privileged, noting that “we particularly disfavor privileges in the employment-discrimination context.”  Id.at 545.  The Shanahan court further noted that, for the deliberative privilege to apply, the documents must contain opinions, recommendations or advice to help make decisions, and not just facts.  Here, the court observed that the disputed documents contained only high level and general recommendation (e.g., “we do need to remain diligent in … insuring that their HR practices minimize the filing of complaints”) or recommended further review and analysis.

Finally, the court noted that at least one of the documents was never used in any deliberations.  According to the court: 

Ms. Illescas [the author of one of the reports] testified at her deposition that no action/no decision was ever made by Defendants in response to the T&J Associates report or her report. In fact the testimony of Ms. Illescas demonstrates that Defendants were dismissing these reports and findings and took no action whatsoever on them. Ms. Illescas testimony reveals that at least one of these reports (Ms. Illescas’ report) may have been used in a retaliatory fashion by Defendants.

In other words, not only was the document not protected by the deliberative process, the court found that it may support the plaintiff’s allegation of retaliation.

It would be a mistake for an employer to assume from this case that it should not investigate and/or document any potential areas for improvement.  It is axiomatic that ann organization should not put its head in the sand, in the hopes that everything is fine, or that no one will find out that there are any issues if they do not document them.  Rather, I have found that issues go to litigation precisely because they fester under an employer’s neglectful or unrealistic watch.  Moreover, while juries may understand that no organization is perfect, they tend not to be sympathetic to employers that turn a blind eye to potentially unjust treatment, or that engage in “blame the victim and shoot the messenger” when issues are raised.  Rather, a prudent employer should learn from this case that any investigation or issue may be discoverable, and that they should act as though all of their decisions and actions will see the light of day, and do the right thing.

This case is also a good reminder that there are numerous “investigative” records, besides formal investigations, that may document potential issues and recommendations, and which may be discoverable.  Many companies have HR issue software, which track investigations and issues, and may include the ability to run various analyses.  Following Sarbanes-Oxley, many companies routinely report audits and other issues to the  Board of Directors and/or Audit Committee.  The Federal Sentencing Guidelines recommends that organizations adopt compliance programs, which includes issue tracking asd part of risk assessments, as well as regular reports to compliance committees and senior management of issues and trends.  Many companies have also implemented hotline reporting systems, from which different analytics can be run regarding trends and statistics, including rise or decline or various issues, as well as statistics regarding the company’s response, which may or may not demonstrate that the company took these complaints seriously, as well as whether employees felt comfortable raising concerns.  Prudent employers would be wise to periodically review all of these documents to determine whether there are issues that need to be addressed.  Depending on the specific facts, plaintiffs might also be wise to consider including these documents in their discovery requests.

A copy of the Shanahan decision is on file with the author, and can be provided on request.

 

Tips for Conducting an Effective Investigation

Monday, March 15th, 2010

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.