Employment Investigations: When Should We Hire an Outside Investigator?

Christy K. Monson

Most employers understand that they have a duty to promptly and fairly investigate employee complaints, especially where discrimination, harassment or retaliation is alleged. However, even sophisticated employers may not have given much thought to when they should hire an outside investigator as compared to handling the investigation themselves. The purpose of this article is to provide you with some factors to consider when deciding whether to use an outside investigator or whether to handle the investigation in house.

Should Our HR Staff Handle this Issue? If you are lucky enough to have an HR staff, you should weigh whether they can or should investigate the particular matter. Many times, if not most, a properly trained HR staff can handle workplace investigations. To determine if your HR staff should handle an investigation, ask yourself the following questions:

  • Do they have experience doing internal investigations?
  • Do they have at least some experience handling the particular type of matter being investigated?
  • Have you provided them with access to your legal counsel so they can get good advice regarding the investigation?
  • Have they been trained in investigation techniques and process?
  • What is their present workload?
  • Does the particular situation require specialized knowledge of certain employment laws or other laws?
  • Does your HR staff have the necessary personal characteristics to neutrally and dispassionately investigate?
  • Does your HR staff have any conflicts of interest or bias regarding this particular situation?
  • Does the particular situation place your HR staff in the awkward position of investigating a superior?
  • Is there any other reason to believe that your existing HR staff may be biased or unable to fairly investigate the matter?
  • Are Other State or Federal Agencies Involved?

Another factor employers should consider is whether other levels of government are involved in the particular matter. For example, some employment complaints also involve federal or state government agencies such as the Equal Employment Opportunities Commission, the Department of Labor, Oregon’s Bureau of Labor and Industry, or Ethics Commission. If other government agencies are involved, you may want to consider using an outside investigator with experience handling similar allegations and a working knowledge of the agencies’ processes. It’s often beneficial if such investigators are also employment lawyers.

Is Litigation Likely to Occur? Is there already a tort claim notice filed or a lawsuit in progress regarding the matter? If there is, you should consult with the attorney handling the lawsuit and with your insurance counsel to determine the best way to proceed. Often insurance counsel or an outside attorney will recommend another outside investigator to alleviate the risk of a retaliation lawsuit. If complaining employees have already hired a lawyer, you may also want to consider using an outside attorney/investigator. (When selecting outside attorney/investigators, keep in mind that an investigator may be called to serve as a witness at a trial, so should not be closely involved in your employment decisions.)

What types of complaints have been made? If more than one employee complains about the same serious problem or about systematic institutional problems, you may want to consider an outside investigator. However, it is important to evaluate the nature of the complaints. Are the employees merely complaining about a particular staff member’s work habits or supervisory skills or about illegal discrimination or retaliation? Are they complaining about ingrained institutionalized problems (such as racism or sexism) throughout all levels of your government? If the complaints are merely about an individual’s work habits or office communication breakdowns, the situation may be better handled by your HR staff. If they pertain to individual acts of discrimination, longstanding institutional discrimination, or other serious matters, an outside investigator may be warranted.

Who Is Alleged to Have Committed Misconduct? Governments often hire an outside investigator if the allegations are against a high-ranking employee or public official. In such circumstances it can be difficult for in-house HR staff to conduct the investigations due to political pressure, increased media attention, or anxiety about keeping one’s job. Hiring an outside investigator in such situations is also evidence that your government is making a good faith, unbiased effort to determine the facts.

What Type of Misconduct is Alleged? If the allegations are extreme, your government may want to use an outside investigator. Allegations of rape, assault, threats on an employee’s life or theft often require outside investigations because it can be difficult for in-house HR staff to remain impartial in such situations. A good rule of thumb is that any time the allegations require a heightened need for objectivity, neutrality or impartiality, it is wise to consider an outside investigator.

Lastly, if you’ve decided to work with an outside investigator, you should also consider the following:

  1. Outside investigator prices vary greatly depending on their background and the demand for the investigator. Meet with potential investigators and ask them about their rates, background and experiences with this particular type of investigation. Ask for references from other employers and about their interview techniques, approximate time estimates, availability, and length and level of detail in their reports. Ask to view a sample report. Consider whether the investigator would be a good witness at a trial.
  2. Do you want the outside investigator’s work and report to remain confidential? If so, you must discuss this with the investigator prior to commencing work and you must include your City Attorney in this discussion.
  3. Be absolutely clear with your investigator regarding the limited scope of the investigation. You should also provide clear directions about what the investigator should do if he/she discovers new violations.

If you would like more information about employment investigations, please feel free to call our offices.

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