The Deep Water Horizon explosion and the massive oil spill into the Gulf of Mexico, made it clear that BP- and the rest of the oil industry, have a lot to learn. Almost six months after the spill, BP has issued a report for the U.S. Bureau of Ocean Energy Management, Regulation and Enforcement. The report is titled “Deepwater Horizon Containment and Response: Capabilities and Lessons Learned,” and describes what went down during the Deep Horizon incident and what is being done to ensure an event like that doesn’t happen again. This morning, BP released another report. The new report is based on findings from the internal investigation at BP that was launched to determine the causes of the explosion and spill.

The thing I like the most about these reports is that BP is taking a step in the right direction and finally sharing information about the April 20th events and the actions taken since then.

Placing the Blame

BP continues to face a lot of scrutiny for the way the company initially responded to the disaster in the Gulf. BP has been criticized for reacting too slowly, being unprepared to deal with the crisis and downplaying the amount of oil leaked into the Gulf. In the report released this morning, BP states that a number of judgment and equipment failures from a number of different parties- including Transocean, Halliburton and BP itself;  are to blame for the disaster in the Gulf. The Wall Street Journal article “BP to Take Some, Not All, Blame in Gulf-Spill Report,” discusses the latest report release from BP:

“The report finds BP facing a tricky balancing act. BP risks opening itself up to greater legal liability if it takes a large part of the blame for the disaster, but if it doesn’t do this it will likely be accused of evading responsibility.”

No company wants to serve as an example of what not to do. Just as lessons have been learned from faults at Tyco, Siemens, Xerox and a number of other companies, BP hopes that their findings will lead to new developments in preventing oil spills and related catastrophes. Some say recent efforts and transparency demonstrated by BP is “too little too late”, but I’d like to think of it as “better late then never.” Interestingly enough, after the internal investigation report was released this morning, BP stock went up 2%. In a press release from BP, Chairman of the Board Carl-Henric Svanberg stated:

“I believe this report will be of significant value in helping the overall understanding of how this tragedy occurred. It is of the utmost importance to the Board to ensure that BP learns from this and further enhances the safety of its operations for the future.”

Here’s a link to download the investigation report in full, as well as watch a video prepared by BP in which the company discusses the investigation findings.

Advancements and Lessons Learned at BP

The “Lessons Learned” document from BP provides companies and industry regulators with planning and response solutions based on the company’s experiences with the oil spill in the Gulf. From preventative measures for avoiding spills to what to do if a spill occurs, BP is sharing the knowledge it has gained to implement safety and process changes. Here’s an overview of the lessons learned according to BP:

1. Collaboration- One single company would never be able to handle all of the challenges presented by the Gulf oil spill. BP has learned that collaboration with government, regulators, the public and countless other stakeholders is mandatory in order to provide the necessary resources and response to the Gulf disaster.

2. Systemization- Systems and procedures require continuous updating to address changing risks. Multiple methods were used when trying to stop the oil leak, providing BP with the challenge of developing a better solution to block the oil. Existing methods were questioned, expanded upon and redesigned to develop a new wave of solutions that allow for faster response and a clearer direction in the event of a disaster.

3. Information- Transparency and communication both internally and externally are essential in addressing public concern. Information assists in stronger decision making, clearing up misconceptions and coordinating activities. Hopefully this lesson is applied throughout the oil industry so that all groups can work together to prevent future disasters.

4. Innovation- In the areas of containment and response, processes and techniques have been redesigned to better prepare BP for future incidents. Using technology, BP has developed ways to implement systems in shorter periods of time. The BP report recognizes the overwhelming unpreparedness of both the company and oil industry in dealing with such a major accident. In the Wall Street Journal article “BP Provides Lessons Learned From Gulf Spill,” the author writes:

“‘It would have been extremely difficult for any one company to address the challenges resulting from Deepwater Horizon alone,’ BP said. Still, the company said, major advances were made in the major response that followed the April 20 blast. For instance, the team charged with containing the oil spill built and installed a subsea manifold system—to help remove hydrocarbons from the leaking wellhead—in just two weeks compared with the 18 to 24 months it usually takes to construct and deploy under normal circumstances.”

On Friday, HP CEO Mark Hurd was asked by the company’s board of directors to submit his resignation. As reported in the TechCrunch Article “HP CEO Mark Hurd Resigns, This Looks Messy,” the outcome of an investigation into sexual harassment allegations against Hurd “concluded that there was no sexual harassment violation, however it did find that Hurd violated HP’s ‘Standards of Business Conduct.‘” When news broke about his departure, Hurd claimed he himself hadn’t lived up to his own standards regarding integrity and respect. Therefore, if he wasn’t able to live up to these standards himself, what message does that send to the rest of the employees at HP?

Numerous reports state that the board’s decision to ask Hurd to resign was based solely on the lack of judgment he had demonstrated in violating the company’s code of conduct. This case is another example of how the unethical acts of a single individual lead to consequences that must be paid for by an entire organization. However, hopefully HP can use this event as an opportunity to rebuild and focus on ethics and compliance throughout the company.

Investigation Findings

An investigation was launched at the end of June as a response to allegations of sexual harassment that had been filed against Hurd. The woman who brought forward the complaint was a marketing consultant hired by HP for certain projects, but was never an employee at HP. During the investigation, investigators came across inaccurately documented expenses that were claimed to have been paid to the marketing consultant for her services. Falsifying the use of company funds violates HP’s Standards of Business Conduct, therefore, resulting in the demand for Hurd’s resignation. I give the board at HP a lot of credit for holding Hurd accountable for his actions and not accepting his offer to simply pay the company back the sum of the expenses he falsely claimed.

Hurd’s resignation raised many questions about the financial future of the company, as Hurd’s time at HP was marked with the success of increasing the company’s performance and value. However, in a press release issued by HP, they focus on the issue of the company’s financial sustainability, assuring investors and the public that the decision to ask Hurd to leave was due to the fact that his actions deemed him unfit to continue as the company’s leader.

The Wall Street Journal published an article, “Text of H-P Memo From Interim CEO,” which features the memo sent to all HP staff by interim CEO and HP CFO Cathie Lesjak, regarding Hurd’s departure:

“This is to advise you that Mark Hurd, Chairman and CEO of HP, has resigned from the company effective immediately. Mark’s resignation was submitted at the request of the company’s Board of Directors as a result of inappropriate behavior in which he engaged that violated HP’s Standards of Business Conduct and undermined his ability to continue to lead the company.”

Consequences

Anytime a company’s CEO falls under investigation, the entire company pays the price. Many begin to question the credibility of a company whose leader demonstrates unethical acts and the inability to make responsible decisions. HP has already started suffering the consequences of their former CEO’s unethical decisions. The New York Times article, “Boss’s Stumble May Also Trip Hewlett-Packard,” stated:

“But turning the page on the scandal will not be easy. While Ms. Lesjak maintained that investors remained confident in the company, H.P.’s share price tumbled 10 percent on Friday as word of Mr. Hurd’s departure rippled through Wall Street.”

As of yesterday, HP stocks have rebounded. However, it’s still too early to determine the full impact of Hurd’s actions on HP.

Opportunities

Unfortunately, it usually takes an event such as this for a company to learn from its mistakes and make positive changes within the workplace. A New York Times article, “Division of Roles Could Help H.P,” suggests that this event has opened up the opportunity for HP to divide the roles of Chairman and CEO. There is no word on whether or not HP plans on splitting up the job, however, it might be a wise decision to make based on some of the situations the company has found itself in recently. The division of these two roles has been gaining in popularity amongst corporate America, and is already common in many other countries.

The division of roles aids in increasing the accountability of those at the top. While some feel the division of roles leads to confusion over who is in charge, I feel that the separation of duties puts a system of checks in place on the CEO, making it difficult to get away with unethical acts, such as falsifying expense reports. For some companies, managing both the board of directors and the company can strain the CEO, creating an imbalance in the attention given to either side. When the CEO and chairman roles are divided between to two different individuals, there is someone present who can question the CEO on their decisions, rather than the CEO simply reporting to themselves.

In the blog post, “The FCPA – Tone at the Top and in the Middle,” by Thomas Fox, Fox raises a very good point about the importance of the tone at the top in relation to the HP case. The tone at the top sets the stage for the overall direction and culture within an organization. HP must carefully select a new CEO who will successfully lead the company with integrity and uphold their ethical commitments in order to avoid future blemishes to the company’s reputation.

In order for a workplace investigation to be credible, investigators must deploy certain tactics to verify the accuracy of interview responses. In a previous post, Investigation Interview Questions to Determine Credibility, we reviewed the EEOC’s 5 factors to consider when determining statement credibility during investigation interviews. One of the toughest challenges to overcome during investigation interviews is the fact that witnesses may withhold or modify their responses to protect the subject- or the complainant and possibly even themselves. As investigators are often pressed for time when conducting internal investigations, they cannot afford to get hung up on determining who is correct in the “my story vs. their story” battle. We have compiled a list of simple tips and techniques investigators can use to determine investigation interview credibility.

Please note: It’s unlikely that the occurrence of a single deception indicator means that the interviewee is lying. Therefore, investigators should carefully observe for multiple deception indicators during interviews when determining statement credibility.

1. Consistent Statements

When asking questions related to the timeline of events involved in an incident, watch for inconsistencies or vague responses. This can be done by asking the interviewee to repeat or recall the order of events at different times throughout the investigation. Ask interviewees to go into greater detail about the incident-related events.  In the “Black Book of Lie Detection,” author Martin Soorjoo states that “when digging deeper, do so in an ‘interested’ manner rather than accusatory. Lying about detail requires a lot of thought and concentration.”

2. Body Language

Controlling physical actions is extremely difficult- hence the phrase “actions speak louder than words”. Pay attention to the physical tendencies displayed throughout the interview. Observe facial expressions and listen to the variations of pitch and tone in their voice. Body language that signifies lying varies across different cultures. Some of the common physical gestures exhibited by someone who is lying include: nail biting, touching their face- usually rubbing nose or covering mouth, avoiding eye contact, stroking the back of their neck, sweating, turning red in the face and fidgeting. In the “Black Book of Lie Detection,” author Martin Soorjoo states that “if an investigator believes the interviewee to be lying, don’t let on about it. Innocent people may become defensive if accused of lying and will demonstrate signs of stress through nonverbal and vocal cues- which can be mistaken as lying.”

3. Consider Your Own Bias

Investigators must remain neutral and refrain from making prior judgments in any investigation. Biases not only shape the attitude an investigator has towards the individual being interviewed, but can also influence the types of questions asked during investigation interviews. In the Business Management Daily article “Assessing Witness Credibility in Workplace Investigations,” they recommend bringing an additional investigator into the interview so that there’s an extra person to compare impressions and notes with. If personal bias is too difficult to overcome, consider asking an investigation manager to reassign the case to someone else to avoid sacrificing the accuracy of the investigation.

4. In the Eyes

Martin Soorjoo, author of the “Black Book of Lie Detection,” provides great insight into how an interviewee’s eyes can give them away. According to Soorjoo, an increased blink rate is often consistent with telling lies. Looking away and avoiding eye contact is tricky, as it may not always signal a lie is being told. When people lie, their pupils tend to dilate, which can be a useful indicator, as the body has no control over pupil dilation.

The free guide below includes an interesting “eye” test that can be used to decipher whether or not a lie is being told.

5. Incorporate Background Questions Into Interviews

At the beginning of an investigation interview, it’s beneficial to ask general background questions as a way to ease the interviewee into the environment. It’s likely that the person being interviewed will expect the questions to be based solely on the incident, therefore, background questions can be used to gauge the ‘normal’ responses and physical tendencies of the respondent. When investigators begin asking difficult, case-related questions it’ll be easier to accurately measure and monitor behavioral changes that indicate lying.

Investigators must be cautious during investigation interviews. People often mistake physical manifestations of stress as being indicators of lies being told. This sometimes happens to innocent people standing trial in a criminal case for a crime they didn’t commit. The irony is, the guilty defendant will have had plenty of time- sometimes years, to rehearse their lie. The innocent person will not have rehearsed because they are telling the truth and are scared because they have a lot to lose. Take this advice into consideration throughout ALL investigation interviews.

i-Sight Investigation Software Overview

i-Sight Investigation Software is a customizable, centralized case management solution developed to help investigators, HR personnel and other members of a company’s investigative unit effectively manage case files. The above video provides a verbal and visual overview of how i-Sight Software works and the benefits it has to offer. Here are some of the topics discussed in the short video:

• Centralized, Web-based Case Management- As investigators are sometimes located around the world, collaboration and case access become issues that increase the time spent on an investigation. i-Sight centrally stores cases so that they can be accessed from anywhere, as they are stored and accessible through a web-browser. This allows investigators to work on cases from any location, at any time, therefore reducing the amount of time spent on investigations.
• Case Access- In i-Sight, case access can be restricted down to the field level. For security reasons, there may be sensitive case information that cannot be shared even within the investigative team. Therefore, investigators may only be granted permission to see cases and tasks assigned to them. Access can be determined by a number of factors- location, allegation type, department and other factors unique to any company’s business processes.
• Investigation Managers- When using i-Sight, investigation managers can control who views which case files. New cases are held in queue, where managers can assign cases to the appropriate investigator. Managers can review the work completed by investigators, and can issue reminders for tasks that are overdue. Reports to measure performance and identify trends can be quickly created through the use of dashboard reporting.
• Alerts- Reminders, notes, expense tracking, attaching exhibits and evidence management can all be done effectively within i-Sight. In order to complete investigations on time, automatic alerts are sent as new cases are entered, to insure the case receives attention immediately. Throughout the investigation process, alerts are sent if a task is overdue, in order to bring attention back to the case. As time is a critical factor in the success of an investigation, alerts make it easier to ensure no case is forgotten.
• Reporting- With many home-grown case management solutions, reports must be manually assembled, which is extremely time consuming in ineffective. With i-Sight, reports are created in minutes, as case information is extracted from the case file and compiled into a customized report template. This feature significantly reduces reporting time, improves report consistency and allows for remedial action to be taken sooner.
• Hosting, Support and System Updates- i-Sight is a hosted solution, which means there is no need to install and manage server hardware or an in-house system. Our staff builds, implements and updates systems as required, therefore, no IT resources are required on our client’s behalf. If a system requires an update- for example, workplace policies are amended or investigators enter or leave the workplace- i-Sight can be updated to reflect these developments.

Demo Request:

For many organizations, situations involving workplace bullying remain a growing concern. Whether the situation involves peers or superiors, all matters involving physical or mental bullying must be investigated promptly, with appropriate punishment administered. Like many forms of workplace harassment or discrimination, movements are being made to hold employers responsible for protecting employees from workplace bullying.

In May, the Wall Street Journal published an article that discussed the signing of a bipartisan measure in the state of New York that would allow employees who have been abused in any form within the workplace, to place charges against their employer in a civil court. Following in the footsteps of the UK Bribery Act and US FCPA, the anti-bullying legislation proposed in New York states that employers may not be held liable in a workplace bullying case if they can provide sufficient evidence that a program is in place to prevent such incidents from occurring. 

A number of other states in the US have developed legislation to help fight workplace bullying, however, according to the article “For Businesses, Bully Lawsuits May Pose New Threat ,” none have become law. If a bill such as this were to become law, there would be significant implications for employers. The number of complaints related to bullying situations would likely increase, resulting in an increase of the number of investigations conducted.

Complaint Handling

Workplace bullying situations vary both in nature and the effect of the actions on each individual. By definition from the “Healthy Workplace Bill,” workplace bullying is:

“Repeated, health-harming mistreatment of one or more persons (the targets) by one or more perpetrators that takes one or more of the following forms:

Offensive conduct/behaviors (including nonverbal) which are threatening, humiliating or intimidating

Verbal abuse.

Work interference – sabotage – which prevents work from getting done.  

All incoming complaints should be treated with equal importance, subject to a pre-screening process before the decision is made to launch a full-out investigation. Upon receiving a complaint regarding workplace bullying, investigators must respond promptly. As previously discussed in this post, workplace bullying isn’t illegal. However, bullying situations, if ignored, can lead to illegal workplace acts, such as discrimination or harassment. In order to respond to and conduct an investigation in a timely manner, investigative units should consider implementing a case management software solution.

i-Sight Case Management Software assists investigators in managing cases through the use of workflow rules and automatic alerts. When a new case is entered into the system, an investigative manager can either assign the case to a member of the investigation team, or the case can be automatically routed to an investigator based on case information. To remain on task throughout the investigation, alerts are sent to bring attention back to overdue assignments to complete the investigation on time. The time it takes to complete an investigation is important. Should the case end up in court, employers can be held responsible for negligence if an investigation is completed improperly or takes too long.

Determining Credibility

Determining the credibility of the complaint is a key success factor in any internal investigation involving bullying. As mentioned above, incoming complaints should be put through a “pre-investigation” process before allocating the resources required for a complete investigation. Certain incidents can be resolved without an investigation, therefore, save some money and investigate when appropriate. Assessing the credibility of an initial bullying complaint is important, as mentioned in the Bloomberg Businessweek article “Employers Can’t Ignore Workplace Bullies,” everyone has a different interpretation of what bullying is:

“What is bullying to me might not be bullying to you. A manager may have to tell you something that hurts your feelings to help you do your job. If your boss screams at you for being late, for instance, you might think that’s horrible… Most commonly, bullying consists of repeated verbal harassment. If it becomes physical there are existing legal tools to deal with it, such as assault and battery. Bullying behavior typically comes from somebody in a position of authority at a company. A bully can be a co-worker, but it’s more commonly associated with a boss and particularly with an immediate boss, as opposed to someone running the company.”

Other areas where credibility must be determined include investigation interview statements. Once it has been decided that a complaint warrants an investigation, it will be important to determine the credibility of statements made by the complainant, subject (the accused) and any witnesses. During investigation interviews, investigators must take note of physical and vocal indicators, as well as any relationships between employees, in order to determine if any bias exists that could be influencing their statements. We cover this topic in greater detail in our post “Investigation Interview Questions to Determine Credibility.”

Every organization faces a variety of factors that put their company at risk. Risks may vary between industries, however, one thing remains the same- employers are responsible for protecting their employees and providing them with a safe workplace by mitigating these risks. In some cases, accidents still happen, employees choose not to follow proper procedures and misconduct ensues. In these types of situations, companies will want to ensure they have an effective reporting system in place, as well as proper tools for conducting top notch internal investigations.

Our Story

At i-Sight, we understand the different pressures organizations are under to comply with regulations and conduct timely investigations. We developed i-Sight Investigation Software to meet a need we recognized within our own workplaces eleven years ago. Since then, we have continued to enhance our understanding of the issues companies face through speaking with our clients and prospects in order to create a solution that makes their job easier.

Closing the Gap

When an individual or company comes to us requesting more information, or a demonstration of i-Sight, many have identified gaps in their current systems, and are looking for a solution that can be built around the processes they already have in place. For example, at Underwriters Laboratories (UL), wanted a system that could handle large volumes of cases, was accessible from any location due to traveling investigators and would allow their current investigations team to handle increasing case volumes without having to add additional members to the team.

At UL, the ability to build a criminally enforceable case requires detailed tracking of information and coordination with law enforcement agencies. UL originally utilized a simple database; however, the application was not capable of capturing e-mails or attachments and didn’t provide investigators with a comprehensive “visual” of each case.

According to Judith Lykins, manager, Anti-Counterfeiting Operations at UL:

“Our goal is to keep dangerous products out of the hands of consumers. In order to put together a successful investigation for criminal enforcement, we needed a more effective way to collect, analyze and output our data.

In order to make it easier for members of the Anti-Counterfeiting Operations team to adopt i-Sight, it was designed to include the same terminology and categories used throughout the process at UL. Now, all members of the Anti-Counterfeiting Operations team have the ability to manage large case loads, while meeting deadlines and submitting consistent reports. i-Sight is a web based system, which makes it easy for traveling investigators to work on cases from any location with an Internet connection.

Increasing Enforcement

Organizations can lose thousands, even millions of dollars if investigations are not completed properly. For example, failure to investigate an employee complaint may result in a costly lawsuit, while taking too long to complete an investigation may result in money lost due to ongoing fraudulent actions. In 2003, the State of West Virginia launched a major reform of its workers’ compensation system, which was then heavily in debt and losing close to $1 million a day. A key goal of the initiative was to reduce the occurrence of fraud and abuse, by stepping up enforcement and by ensuring greater coordination among the state officials who were responsible for overseeing the system.

“‘First, we found that the reporting features within i-Sight were excellent,’ said Chris Bailes, Director of Operations at the Office of the Inspector General. ‘That is really key, because without good data we can’t make good decisions. And second, we appreciated the flexibility that i-Sight gave us. We liked the fact that if we wanted to change our internal procedures six months down the road, i-Sight would allow us to do that.’”

Since implementing i-Sight, the Office of the Inspector General (for the first time ever) has a convenient way of tracking and monitoring court-ordered restitution and repayments. Prior to implementing i-Sight, Bailes stated they  ”had over $6 million dollars in restitution and repayment agreements, and a little over 10% of that had been paid. We needed a way to monitor that situation the same way a bank monitors its loan repayments, with automatic alerts when people are missing their payments. i-Sight case management software does that for us, which is a fantastic feature.”

Chemring Halts Deal on Corruption Probe- Telegraph.co.uk

Chemring has decided to renegotiate plans to takeover Allied Defense Group due to a bribery related investigation the company is undergoing in the United States. This article demonstrates another risk companies face when employees engage in illegal, corrupt acts. As demonstrated by the halt in acquisition by Chemring, businesses don’t want to partners with others who have tarnished reputations.

Lawmakers Assail Minerals Management Service- The Washington Post

The investigation into the BP oil spill in the Gulf of Mexico continues to bring forward several indicators signaling something was wrong with the pipes leading up to the explosion. The investigations raise questions of the procedures and maintenance of the pipes, as well as where to place accountability for the explosion. This disaster demonstrates the importance of developing proper procedures and an ethical corporate culture.

Investigator selection is a crucial component of any successful investigation. In smaller companies where employees frequently interact and know each other on a more personal level, investigator selection is a very difficult task. Depending on the size of an organization, companies may use third party investigators, while others use internal staff. There are pros and cons to both, as internal employees are fully versed in company policy and procedures, whereas third party investigators are able to maintain neutrality, as it’s unlikely they have any personal interests vested in the outcome of the investigation. When selecting investigators, focus making decisions to reduce personal bias and increase investigator neutrality.

What to Look For:

According to guidance offered by the EEOC through their “Enforcement Guidance: Vicarious Employer Responsibility for Unlawful Harassment by Supervisors,” they conclude investigators should be selected based on their ability to objectively gather and consider  relevant facts pertaining to the investigation. Investigators should be well trained in all areas covered by the investigation, including evidence preservation, interviewing, determining statement credibility and areas of employment law. The EEOC also suggests the “harasser” shouldn’t be in a supervisory position to the individual conducting the investigation, as this could potentially impact the conclusions drawn from the investigation. In the Mediation Blog post, “Neutral Investigations of Workplace Disputes,” author Roger Benson writes:

“Here are some critical things to look for when evaluating candidates:

• In-depth understanding of the law of the workplace and the alternatives to a negotiated settlement.
• Experience, skill and personality to quickly establish trust and confidence in the integrity of the investigation process.
• Insight to gather all of the facts necessary to develop a coherent, thorough and accurate assessment of the dispute.
• Expertise to provide recommendations for a practical, cost-effective and durable resolution.”

The Strategichrlawyer.com article by Diane M. Pfadenhauer, “Workplace Investigations: Rethinking the traditional paradigm and advocating the use of third party investigators,” provides a list of some additional skills to look for when selecting investigators:

1. Knowledge of the industry- If special skills or experience are required for an investigation to be conducted properly, select an investigator who meets the particular requirements. Familiarity with the industry the investigation occurrs in is ideal, as the investigator already has an idea of what questions to ask, the evidence to look for and can add value to the investigation with their experience.

2. Knowledge of the workplace- Understanding workplace policies makes it easier for an investigator to conduct a thorough investigation into workplace misconduct. Knowledge of company operations and culture contribute to a stronger understanding of why company policies are designed the way they are.

3. An understanding of the legal process- Knowledge of the litigation process and laws governing companies in various industries increases the effectiveness of an investigation. This is particularly important in planning the investigation and anticipating where to locate evidence, resulting in a complete investigation.

4. Knowledge of the subject matter in question- When selecting an investigator, consider their area of expertise. If the investigation involves accounting or finance, have someone who is an expert in that field carry out the investigation. They will be better at understanding the misconduct and will know what questions to ask and evidence to look for.

5. Ensure attorney client privilege is preserved- During the planning stages of the investigation, determine if outside counsel will be used. If so, make it very clear who the counsel represents.

The Importance of Neutrality

When it comes to deciding between using internal or external investigators, there are many conflicting views as to which group properly maintains neutrality throughout the investigation. There is no right or wrong answer. Organizations need to evaluate and determine which source best suits their investigative needs. In Benson’s blog post, “Neutral Investigations of Workplace Disputes,” he discusses neutrality when using a third party investigator:

“People are more likely to cooperate and offer candid information if they see the investigator as someone interested in the truth and without a hidden agenda or pre-conceived ideas. They also see a neutral investigator as an indication of the employer’s good faith commitment to conducting a legitimate investigation.

In contrast to Benson’s opinion, others feel an investigator from within earns the trust of the employees involved in the investigation, as the investigator is a familiar face. Some employees are more likely to open up to someone they know and feel comfortable talking to, contributing to the success of the investigation. Internal investigators are already familiar with the culture, policies, and laws governing the organization, reducing the time spend educating an external investigator on these matters.  The decision to use internal or external investigators depends on a variety of factors, including the issue under investigation, the employees involved, corporate culture, company size and skill sets of internal employees.

Successful investigations contribute positively to corporate reputations. On their corporate website, PricewaterhouseCoopers provides advice for selecting an internal investigator, stating:

“The company needs to ensure investigators are fully independent in forming their opinion. The measures taken to guarantee their independence must be explicitly documented. Given the complexity of most investigations, we recommend seeking expert advice from the very beginning of the process. We advise you to select parties not only with extensive experience and a wide range of applicable skills, but also with an impeccable reputation: corporate image is often a crucial factor in these investigations.”

Maintaining confidentiality during internal investigations is complex. If a company plans to bring in outside council, they must carefully plan out the investigation in order to uphold attorney-client privilege. To reduce confusion during investigation interviews, companies need to ensure “Upjohn warnings” are worded properly.

In order to preserve attorney-client privilege, evidence collected during the investigation needs to be labeled confidential, interviews must be well documented, the names of those in attendance during interviews must be recorded and limit the number of people granted access to investigation information.

Pre-Interview Warnings

As stated by Doug Cornelius in his blog article “Attorney-Client Privilege and Internal Investigations,” a “conflict of interest could arise when an attorney or law firm simultaneously represents an organization and one or more of its officers or directors.” These conflicts have become a growing concern, resulting in a ruling requiring lawyers to tell employees they represent the company, not the individual.

In the blog post “Miranda Warnings for Lawyers? Recent Rulings Highlight the Possibility,” on WSJOnline:

“Lawyers say it already is widespread practice to give some kind of notice in contacts with employees that the lawyer represents the company or its board of directors, not the employee. The Broadcom ruling is likely to make that warning even more precise. ‘We’re going to see the interview warnings turn into something akin to the Miranda warning the police give to suspects,’ said Steve Crimmins, a former SEC lawyer now at Mayer Brown.”

Upjohn and other similar warnings demonstrate best practices both in the US and internationally. To help protect the privacy of information related to the investigation, take this time to tell interviewees not to discuss the case with others. In the article “Supreme Internal Investigations: Important Lessons From Aguilar and Computer Associates,” they elaborate on the importance of Upjohn-style warnings at the beginning of investigation interviews. The article also emphasizes the importance placed on the wording of such warnings:

“In particular, it’s important to carefully consider the standard Upjohn warning given by company counsel at the commencement of an employee interview. The warning informs the employee that (a) counsel represents the company, not the employee; (b) the interview is covered by the attorney-client privilege; (c) the privilege belongs to the company; and (d) the privilege is therefore the company’s, and not the employee’s to waive. What is important, is that companies and their counsel realize the legal significance of the phrasing of warnings, and carefully consider the interests at stake in deciding how to approach this delicate issue.”

Legal Representation

Clarifying a lawyer’s representation helps avoid future lawsuits and accusations of unethical practices. In order to maintain fairness and conduct a bias free investigation, those who are interviewed need to know the facts before divulging information. In some states or countries, it’s required that lawyers receive written consent from both parties, should the lawyer represent both the employee and the corporation. Where there is potential for conflict of interest, written consent demonstrates each party’s acknowledgement of the lawyer’s representation.  If either group has an issue with being represented by the same lawyer, one party will have to seek a different legal counsel.

As discussed in the Ethisphere article “Traun’s Ten Commandments for Conducting Internal Investigations“:

“Ethical rules require counsel to make clear who they represent at the outset of interviews. While the warning may cause employees to refuse to talk (and to thus face discharge for refusing to meet and discuss company business), counsel must still give the Upjohn warning. If a company is cooperating with law enforcement authorities and there’s an agreement or expectation the company will share the substance of internal investigation interviews with them or the memoranda of interviews themselves, then counsel should advise employees that waiver of the privilege is likely, probable or near certain.”

When planning out the investigation, corporations should consider whether or not they plan on waiving the rights to attorney-client privilege, as they are the only ones with the authority to do so.