It is perhaps not surprising that, at one point or another, a need will arise at the workplace for an investigation – formal or informal – regarding a complaint or grievance about a work related matter. For many employers, conducting workplace investigations is not only daunting but often mishandled.
An investigation carries with it the concept of discovering the truth through an impartial information gathering process. In a workplace setting, it requires a careful examination of acts, omissions and events in order to make objective factual findings that assist in the implementation of appropriate outcomes. Not all workplace matters require investigation. In fact, conducting an investigation in circumstances where it is not warranted will create significant difficulties for the employer, and may irreparably harm the workplace culture. However, the failure to conduct a proper investigation when the circumstances require one, can likewise be extremely damaging, and may result in liability for the employer.
It is important to assess quickly, when confronted with a workplace matter, whether an investigation is appropriate and, if so, by whom it should be done. Carrying out investigations internally can not only tie up considerable management time and resources but can create legitimacy issues impacting on downstream legal considerations such as standards of proof, privacy protection, reporting criminal offences and maintaining confidentiality and legal professional privilege. In many circumstances, insisting that serious complaints or allegations be resolved at the workplace level through a private or conciliatory approach is not always appropriate nor legally sensible. Often an evidence-based process with substantial investigative rigour can be far more protective of the business interests and of all persons concerned.
Equally, there are risks in incorrectly deciding to not investigate (or in not investigating because no decision was made at all). A claim of sexual harassment, for example, that is not investigated, may eventually lead to litigation where one likely issue will be the company’s failure to take all reasonable steps to prevent the sexual harassment from occurring. Worse still, failing to investigate may itself be discriminatory.
From a cultural perspective, an un-investigated complaint may leave the complainant feeling disheartened, and if the complaint was justified, may simply result in the person at fault increasing the level of improper activity, putting the company at increased legal risk. For that reason alone, it is good practice to take care when exercising the discretion to investigate or not. The decision to investigate should take into account the following considerations:
- How serious is the matter or conduct in question? The more serious the matter, the more likely a formal investigation is warranted;
- Can the issue be properly resolved without investigation, such that each party feels the issue has been dealt with appropriately;
- How many people have been impacted (or may be impacted by the conduct/ issue under consideration; and
- Will the failure to investigate the matter create legal liability.
Once a decision has been made to conduct an investigation, there still needs to be consideration given to who will conduct the investigation. One of the central hallmarks of a proper investigation is independence. If an independent investigation can be performed in-house by the employer, then there is no reason to outsource the investigation. However, if this is not possible, the matter is very serious or the issue concerns an employee at a very senior level in the organization, it is best that the investigation be conducted by an external third party, usually under the auspices of legal advice, so that legal professional privilege will attach to the investigation findings and outcomes.
While the need for an investigation is often apparent, the steps involved are often less so, especially as no two investigations will ever be the same. Some important key tips to structuring an investigation process include:
- Understanding the issue or issues;
- Planning carefully;
- Obtaining the evidence;
- Reviewing the evidence;
- Testing the evidence and making findings;
- Writing an investigation report;
- Determining appropriate outcomes; and
- Keeping proper records.
In some circumstances, an employee may raise a workplace issue casually with their employer, or make an “informal” complaint but does not wish for any formal action to be taken. This was the case in Swan v Monash Law Book Co-Operative  VSC 326 (“Swan”) where Ms Swan disclosed to her employer a pattern of serious bullying by her manager, but indicated she could not “cope” with an investigation. Consequently, nothing was done with Ms Swan’s complaint and the employer when the matter reached the Courts, tried to rely on the assertion by the employee that she could not “cope”, in failing to take any remedial action at all.
In Swan, the Supreme Court of Victoria awarded the employee almost $600,000 in damages for severe psychological injuries resulting from the bullying behaviours Ms Swan was subjected to by her manager, on the basis that her employer failed to take reasonable care for her safety and did not provide a safe system of work.
In Richardson v Oracle Corporation Australia Pty Limited  FCAFC 82 found that the employer failed to comply with its policies and obligations to investigate a serious complaint of sexual harassment, and that the employer had not taken all reasonable steps to prevent the sexual harassment. As a result, Ms Richardson was awarded $130,000 in damages, a portion of which was characterised as a tax-free general damages amount in recognition of the pain and suffering, hurt and humiliation suffered by Ms Richardson as a result of the harassment and bungled investigation.
Finally, in Emery v City of Stirling  FWC 6853, the Fair work Commission determined that the significant deficiencies in a purported investigation into an employee’s conduct was sufficient to render the termination unfair. Commissioner Bissett stated that “While it is true that procedural defects will not necessarily render a dismissal unfair, in this case I am satisfied that the lack of an appropriate investigation and the involvement of [the supervisor] in the investigation means little confidence can be had in the investigation process (as it was)”. Commissioner Bisset went on to say that she was not convinced that the outcome may have been different for the employee had a proper and thorough investigation been undertaken.
We recommend that employers should have comprehensive and flexible policies, which deal with different workplace issues that may require an investigation, and set out a procedurally fair process for the conduct of a workplace investigation. Once those policies and procedures are in place, it is essential that employers ensure that they are properly communicated to employees, and understood by, employees, and are appropriately followed when the need for a workplace investigation arises. Where it would be inappropriate to conduct an investigation internally, employers should consider the benefits of engaging an expert.
In certain instances, an employer may have no say in who conducts an investigation (for example the Workplace Ombudsman, or WorkCover). When, however, an issue presents itself it is imperative to consider the advantages of using an external investigation service. The benefits of external investigators may include:
- They can be viewed as more neutral by employees;
- They have particular skills and expertise gained through experience;
- They provide completely impartial and objective assistance;
- Employees will feel that the Company is taking the issue seriously;
- If conducted by lawyers will be protected by legal professional privilege; and
- It may be easier to convince a court of tribunal about the integrity of an investigation when it has been independently conducted.
For more information about our complete investigation solutions, or to discuss an issue that requires investigation, please do not hesitate to contact our office for specialist advice or assistance.
This alert is not intended to constitute, and should not be treated as, legal advice.
This article is for general information purposes only and does not constitute legal or professional advice. It should not be used as a substitute for legal advice relating to your particular circumstances. Please note that the law may have changed since the date of this article