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Risk Free Workplace Investigations

Workplace investigations are a critical risk management tool, but they don’t come without risks of their own.

Most employers understand the critical importance of conducting internal investigations when confronted with evidence of possible employee misconduct. But many are surprised to learn that a delayed or poorly performed workplace investigation can form the basis for corporate liability.

To avoid corporate liability for workplace investigations, employers need to (i) initiate internal investigations at the first sign of trouble, (ii) ensure the investigationn is properly conducted, and (iii) act decisively when the investigation reveals evidence of workplace misconduct.

A leading federal case illustrates the risk. In Amirmokri v. Baltimore Gas and Electric, 60 F.3d 1126 (4th Cir. 1995), an employee complained of workplace mistreatment motivated by his colleagues’ animosity towards his Iranian heritage. In particular, the employee alleged failure to promote, harassment, and constructive discharge. The harassment consisted of derogatory references to his national origin, such as calling him “the local terrorist.” While the employer conducted a workplace investigation, it was delayed, cursory, and ultimately ineffective.

Noting that proof of constructive discharge would require that the employer deliberately made the employee’s working conditions intolerable, the Fourth Circuit concluded that a shoddy investigation could constitute this proof. In particular, the Court said a jury could find the company’s investigation was insufficient because it was initiated too late, poorly conducted, and did not end the harassment. And the insufficiency of the investigation could be considered in deciding whether the company had acted intentionally against its employee.

Properly conducted workplace investigations are among the most powerful risk management tools available. Companies can minimize the risk of liability associated with conducting workplace investigations by reacting immediately, effectively, and decisively at the first signs of employee misconduct.