Conducting Effective Workplace Investigations:

A Step-By-Step Guide

Presented by Jonathan M. Werner, Esq.

August 2013

First, A Little Humor…You think your employees are bad? Look at this company:Of 500 employees,

29 accused of spousal abuse. 7 arrested for fraud. 19 accused of passing bad checks. 117 bankrupted two or more businesses. 3 arrested for assault. 71 can’t get a credit card because of poor credit. 14 arrested on drug-related charges. 84 drunk driving cases in the prior year alone.

What Company is this?

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It’s the United States Congress—Your Tax Dollars at Work!

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Events That Can Trigger An Employer Investigation

• Employee complaints of harassment or discrimination

• Employee complaints of retaliation• Allegations of misconduct, theft, etc.• Attorney demand letters• OSHA/Safety issues, workplace injuries and

accidents• SOX—Whistleblower complaints or reports• Lawsuits or administrative claims

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Why Should Companies Care?• Federal/state discrimination/harassment laws

impose a duty on employers to investigate employee-related complaints

• Federal/state OSHA laws impose a duty on employers to investigate accidents, safety violations

• Various whistleblower statutes impose a duty on employers to investigate

• Provisions in written employment agreements may impose a duty to investigate

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Why Should Companies Care? (Cont’d)

• Failure to promptly investigate may be used as a separate basis of liability

• May create an inference of malice, leading to punitive damages

• Under Federal law, a good investigation can be used by the Company to limit or avoid liability for harassment where the employee suffered no adverse employment action

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Why Should Companies Care? (Cont’d)

• Under state law, the Company is still strictly liable for a supervisor’s harassment, but it can rely on a good investigation to limit the damages recoverable

• Under state law, a good investigation can be used to establish that a Company had a “good faith belief” that an employee engaged in misconduct to justify a termination

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Why Should Companies Care? (Cont’d)

• Finally, plaintiff’s attorneys are focusing on the adequacy of employer investigations to justify additional claims against the employer and to make the employer “look bad”– “Employee complained but the Company did

nothing”

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What Constitutes A “Complaint”?• Easy to recognize

– Written or verbal communication from employee specifically complaining of harassment or other objectionable conduct.

– Employee verbally states he/she has been treated badly or unfairly

– Supervisor reports that inappropriate acts or misconduct have occurred

– DOES NOT HAVE TO BE IN WRITING, AND CANNOT BE REQUIRED TO BE IN WRITING

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What Constitutes A “Complaint”? (Cont’d)

• Harder to Recognize– Statements in exit interview that employee is “fed

up” with something about the Company– Offhand comment from employee directly or

overhead by supervisor about inappropriate conduct in workplace, but no specific “complaint”

– Employee mentions to supervisor that “Jeff and Jill have really been at each other’s throats today”

– NO MAGIC WORDS REQUIRED10

Legitimate Goals Of An Investigation

• To determine if a problem exists• To protect the company• Opportunity to demonstrate fairness by the

Company• To encourage employees to report problems

to management and to use the Company’s internal dispute resolution system.

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Steps In An Effective Investigation

1. Determine and implement necessary immediately action

• Suspensions– With or without pay?– Temporary separation of employees?– Status report to alleged victim

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Steps In An Effective Investigation (Cont’d)

2. Choose the most appropriate investigator• Consider demeanor• Is empathy important? (hint: usually)• What sex should the investigator be?• Who would most likely be impartial?• Does the most likely candidate have a

conflict of interest?– Is he/she the accused?

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Steps In An Effective Investigation (Cont’d)

3. Review personnel files4. Review company policies and other relevant

documents5. Review emails and other electronic

documents and files6. Conduct thorough, probing employee

interviews

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Should You Use An Attorney?• Pros:

– Knows law and has a variety of experiences– Skilled and impartial investigator– Good option if HR resources are thin or facts are

particularly complicated– New set of eyes can’t hurt– Privilege arguments

• Cons:– May preclude representation by that attorney in litigation– Timing and cost issues

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Conducting Employee Interviews

• Determine the order of witnesses– Case by case determination– Ideally, we want to be able to fully confront the accused– Are there any witness tampering issues?– Are there confidentiality issues?– Is the element of surprise important?

• Usual order of witnesses:– Complainant (victim), witnesses, the accused, additional

witnesses

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Conducting Employee Interviews• Interview Techniques

– Use a new page for each witness– Keep notes on separate paper regarding the witness’

credibility (body language, gestures, eye contact, etc.• Basics

– Date– Location– People present– Interviewers identity and initials– Items for follow up

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Conducting Employee Interviews• Suggested Script

– Why interview is taking place– Seriousness of investigation– Role interviewee plays in investigation– Truthful cooperation and completeness required– How information relayed may be used by the

Company– Confidentiality will be maintained, to the extent

possible consistent with the Company’s obligation to conduct a thorough investigation

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Conducting Employee Interviews• Suggested Script (Cont’d)

– Interviewee should not discuss interview or events leading to investigation with others, without advance direction from the Company

– Explain that there will be no retaliation for the interviewee’s good faith reports and statements

– If asked, the Company is unsure about the final outcome of the investigation at this point

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Conducting Employee Interviews• Interview Techniques

– Slow the interviewee down– Use direct quotes sparingly– If the interviewee reports something as rumor or

speculation, note it as such– Avoid compound questions (K.I.S.S. Rule)– Easy questions first, hard questions later– Avoid legalese and legal jargon – Try to get a chronological explanation of events– Re-tell the story, and confirm chronology as necessary

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Conducting Employee Interviews• Interview Techniques (Cont’d)

– Record objective observations, not conclusions• YES: “Blushed,” “raised voice,” “no eye contact”• NO: “Appears to be lying” or “evasive”

– Do not make legal conclusions (that’s my job)• YES: “Inappropriate” or “unprofessional”• NO: “Harassment” or “discrimination”

– Tape recorders are usually a bad idea, and illegal in California without both parties’ consent

– Don’t discuss theories or speculation with interviewee

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Conducting Employee Interviews• Things to watch out for

– “Do I need a lawyer”– “I do not want to be involved”– “What will happen next?”– Follow up emails and statements by interviewees that

their comments are “off the record”• Tip: NOTHING is “off the record”

• Concluding the interview– Always carefully review your notes before ending the

interview and ask, “Is there anything else I should know?”

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Interviewing the Complainant• Who, what, when, where, why, how• Details, details, details• Consider obtaining a signed statement, prepared

by the Company• Identify specific conduct involved• Are there others with similar complaints?• Has the complainant complained to anyone else?• Remember, this could be your future plaintiff

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Interviewing the Complainant (Cont’d)

• Does the conduct occur at any particular time or location so that you could observe it?

• Frequency of conduct (especially important for harassment complaints)

• Identity of witnesses• “Anything else I should know?”

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Interviewing Other Witnesses

• Interview every single witness identified by the Complainant

• Challenge responses that are too agreeable• If witnesses are former employees, make

whatever efforts necessary to reach out to them (meet at Starbucks, after hours, etc.)

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Interviewing The Accused

• Who, what, when, where, why, how• Get a response to each and every individual

allegation• Details, details, details• “Any reason for Sally/Bob to lie or exaggerate?”• Identify any witnesses who support the

accused, and interview them• “Anything else I should know?”

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Interview the Complainant’s Supervisor

• What did he/she know about Complainant’s complaint?

• If he/she did know about it, what, if anything, did the supervisor do about it.– If nothing, consider discipline for the supervisor

• Does the Complainant have any discipline or performance problems

• Has Complainant recently been put on notice regarding his/her performance?

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Developing The Right Conclusion

• Look for common threads of credibility– Believability, as objectively measurable as possible– Is story vague or consistent?– Bias?– Motives?– Demeanor and attitude?

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Make Decision and Write a Final Report

• Avoid creating causes of action for the accused (i.e., defamation)– Keep all related conversations private and

confidential• Destroy all drafts and proofread carefully• If attorney involved, label “attorney-client

privileged/attorney work product”• Have another executive review• This report will end up in court

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Post-Investigation Steps

• Take Appropriate Corrective Action– Make it PROMPT– Make it APPROPRIATE– Make it REASONABLE

• What is reasonable corrective action?– Consider severity, frequency and duration of conduct– Corrective action should stop the offensive behavior– Should be proportionate to the offense

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Post-Investigation Steps (Cont’d)

• Reasonable corrective action may include:– Termination– Discipline (suspension without pay, written

warning, etc.)– Transfer of Accused, demotion, loss of promotion

or bonus, reduction in pay, etc.– Training – Counseling

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Post-Investigation Steps (Cont’d)• Remedies for the Complainant may include:

– Offering paid leave– Offering Company-paid counseling– Offering transfer (be careful)– If employee confirms he/she wishes to leave Company,

negotiate severance package (with complete release)– Paying for any costs incurred (such as for counseling,

medical costs, loss of benefits, loss of any pay or accrued leave for absences caused by harassment, etc.)

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Post-Investigation Steps (Cont’d)

• Meet with the Complainant and provide him/her with memo summarizing results– Under California law, the Complainant must be

advised of conclusions reached and actions to be taken

– Memo should confirm prohibition against retaliation and encourage immediate reporting of retaliation

– Memo should remind Complainant of open-door policy or other process if he/she is dissatisfied with results and action taken

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Post-Investigation Steps (Cont’d)• Meet with the Accused and provide him/her with

memo summarizing conclusion(s) of investigation and any action, if any, to be taken– Memo should remind Accused of prohibition of

harassment and retaliation– Memo should remind Accused of open-door policy or

other process if he/she is dissatisfied with results and action taken

– If termination results, at least two witnesses should be present with final paycheck

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Maintaining Documentation

• Keep all investigation files, including interview notes, witness statements, correspondence and documents gathered in the course of the investigation, in a separate file—not in a personnel file

• All investigation documents should be marked as such

• Keep all investigation files confidential and under lock and key, and limit access

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Maintaining Documentation

• Keep all investigation files, including interview notes, witness statements, correspondence and documents gathered in the course of the investigation, in a separate file—not in a personnel file

• All investigation documents should be marked as such

• Keep all investigation files confidential and under lock and key, and limit access

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Expected (and Unexpected) Issues• The uncooperative Complainant, Accused or

witness– Remind them of obligation to cooperation (and in some

cases, potential for discipline for failure to cooperate)– Assure them of confidentiality (within limits) and non-

retaliation– Remind them that the Company can only take action

based on what information it is able to obtain; if information is withheld, the Company cannot consider it.

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Expected (and Unexpected) Issues (Cont’d)

• The uncooperative Complainant, Accused or witness– Refusal by Complainant to cooperate may cause the

Company to doubt his/her credibility– Refusal by Accused to cooperate may cause the

Company to conclude he/she engaged in wrongdoing

– Interview notes should confirm refusal to cooperate and that disclosures were made to confirm consequences of non-cooperation

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Expected (and Unexpected) Issues (Cont’d)

• Complainant/Accused/Witness refuses to submit to interview without presence of counsel– Confirm to employee that counsel may become a

witness and cannot interfere with investigation– Refusal to permit counsel may affect reasonableness

of investigation• Bottom line: better to allow attorney presence than to

refuse– If attorney present, have Company attorney also

present

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Common Investigation Mistakes• Taking the side of one of the parties involved

– Remember to remain neutral• Promising complete confidentiality to a party or

witness• Failing to properly document the investigation• “Lazy” Investigators

– Do not simply ask for written accounts of what happened.– Make the interviews interactive

• Failing to reach a conclusion

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Common Investigation Mistakes (Cont’d)

• Failing to interview the Accused prior to reaching a conclusion– Need for due process– Accused may admit guilt or give false statements

during interview that can be used as a basis to terminate or discipline him/her.

• Failing to promptly begin the investigation• Not having a reporting structure in place

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Any Questions?

Jonathan M. Wernerjwerner@jdtplaw.com

T: 949.851.7422F: 949.752.0597

www.jdtplaw.com42