Wednesday, December 11, 2013

(HR) Unwelcome encore: managing investigations to survive ensuing litigation



The classic Yogi-ism―”It ain’t over ’til it’s over”―has special significance for employment investigations. An investigation can lead not only to discipline against a perpetrator but also to litigation by the victim―or even the perpetrator―against the investigator or the employer. In either of those unsavory situations, the investigator or HR manager may be called on―often by subpoena and sometimes by being named as a defendant in the lawsuit―to defend the investigative report and the process that led to it.

As part of that process, the employer is usually required to produce all the records the investigator or the company generated or received in connection with the investigation. At that point, the investigation is no longer about the perpetrator or the victim. Instead, the investigator and the HR manager who oversaw the investigation are the ones who are on trial.

Investigators, HR managers can become targets in litigation
Litigation can ensue after an investigation in one of four main ways. First, alleged victims in discrimination or harassment cases who are unhappy with the investigative results often initiate a lawsuit against the employer and the alleged perpetrator, claiming that the employer didn’t properly remedy discrimination. The victim often will also sue the perpetrator for harassment, assault, battery, and the like.

Second, in a workplace in which employees have “for cause” protection against discipline, employees who were disciplined or terminated as a result of an investigation will often blame the investigator for a flawed investigation, accuse the employer of setting up a biased investigation, or allege that the employer’s decision was simply wrong because the investigator erred in his conclusions. That can lead to an administrative appeal (such as arbitration) and then to litigation.

Finally, perpetrators can initiate their own affirmative lawsuits against the employer, alleging defamation, wrongful termination, or violation of their privacy rights. In that scenario, the investigator or HR manager is often the focus of the attack.

What happens in the ensuing litigation?
Plaintiffs’ attorneys routinely seek the disclosure of all files and records the investigator gathered during the case, including notes, draft reports, e-mails, and personal calendars. Records of any communications between the employer and the investigator are usually fair game. That may include communications between the investigator and the company’s legal counsel or HR contact person. In the hands of an experienced litigator, an investigative report is a fine vehicle for extensive cross-examination about the investigator’s experience, neutrality, motives, competence, comprehensiveness, record keeping, conduct during interviews, and overall investigative method.

But that’s only the beginning. Usually, the next step in litigation is the deposition, in which the plaintiff’s lawyer has the opportunity to grill the investigator or HR manager about the broadest imaginable variety of issues pertinent to the investigation. The rules of discovery (pretrial fact-finding) allow full exploration of the facts. If the questions probe into areas that aren’t relevant to the lawsuit, the most your lawyer can do is object―but the questions still must be answered. For example, in one case in which my deposition was taken, a plaintiff’s attorney spent about four hours asking me questions about my relationship with the employer, suggesting bias toward the employer as well as lack of neutrality.

Some cases end up being resolved before trial, either by an employer’s successful pretrial motion to dismiss the case or by settlement. Absent such a resolution, however, the matter will go to trial (usually before a jury), and the investigator or HR manager will be required to testify. It’s now a trial in both senses of the word, with the plaintiff’s lawyer typically grilling the investigator or HR manager on a broad range of issues, including his qualifications, neutrality, selection, and independence, the process he followed, the witnesses he interviewed, the documents he gathered, and his contact with the employer during the investigation.

In litigation, the factual findings and analyses of the investigative report are deeply probed. For example, a plaintiff’s attorney will routinely seek disclosure of all drafts of the investigator’s report and then probe for inconsistencies in the analysis, the employer’s review and edits of the drafts, and the investigator’s internal deliberative process; flaws in the investigative process; problematic use of noninvestigative personnel in creation of the report; and similar potentially revelatory material.

In sum, litigation often entails a highly intrusive and adversarial retracing of every step of the investigation process, including the investigative report and findings, drafts of the report, and details about the relationship between the investigator and the employer.

Attorney-client privilege usually doesn’t shelter investigation
Do the same perils arise when the investigator is an attorney? Many employers assume that the attorney-client privilege applies to any communications when the investigator is a licensed attorney. Usually, that’s an incorrect assumption because the attorney isn’t giving legal advice in an investigative situation. Thus, the employer and its attorney investigator need to assume that the privilege will not apply.

There’s one exception. Clients, inside counsel, and sometimes investigators themselves use attorneys to get advice about proper investigative processes, review documents the employer must generate as part of the investigation, and review the draft of the investigative report. Assuming the attorney-client privilege is properly maintained, those types of activities are ordinarily privileged against disclosure.

Checklist to avoid being the target
What preventive steps can an HR manager take in connection with investigations? Here’s a checklist of precautions:

    Perform due diligence when selecting the investigator.
    Take appropriate steps to maintain confidentiality.
    Ensure that the investigator was afforded independence in conducting the investigation.
    Be aware of federal, state, and local laws pertaining to how investigations are conducted.
Always remember that any and all communications about the case (written, oral, and electronic), whether they’re made within the organization or with the investigator (including attorney investigators), are likely subject to disclosure in litigation.

The investigator should keep the following points in mind:

    Don’t take cases outside your expertise.
    Maintain your independence as the investigator.
    Keep copies of all documents and statements gathered during the investigation.
    Keep a log of all contacts made during the investigation.
    Abide by special procedural requirements imposed by federal, state, and local law.
Be aware that any and all contact with the employer during the investigation is fair game in litigation.

Bottom line
As long as there are lawsuits, there will always be a risk that completed investigations won’t truly be “over” and that litigation will lay bare the entire investigatory process. Employers and investigators can find hope in another Yogi-ism, however: “You can observe a lot by watching.” Take proper preventive steps to avoid the unwelcome encore of litigation
Source: HR Hero Line

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