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American Bar Association

ABA Section of Business Law

Volume 11, Number 3 - January/February 2002

Checking out claims of harassment
How to investigate by the book

    By Anne Buckleitner

Employee allegations of sexual or racial harassment are potentially explosive and require an employer response. If such allegations are handled appropriately, the employer can defuse the workplace and minimize its own liability. If an employer handles an allegation carelessly or half-heartedly, however, the workplace conflagration can be accelerated, and the employer may burn itself in the process.

If a business client consults you in the course of crafting a response to employee allegations, there is much that you can suggest to maximize the response and minimize exposure; for businesses who insist on going it alone, however, there's not much that can be done - except wait for the plaintiffs' bar to give them a wake-up call.

To sensitize your clients to the importance of handling employee complaints with speed and care, consider sharing with your client the essence of these recent cases in which employers' responses shaped their legal destiny.

A recent Eighth Circuit opinion affirmed a hefty judgment against an employer for what was apparently a lethargic or slipshod reaction to employee complaints:

In Madison v IBP Inc., ____ F3d ____ (8th Cir. 2001) (Nos. 99-2859, 99-2853), the circuit court reviewed and affirmed a $1.7 million jury award, much of which was punitive, awarded to a meat packing plant employee who reported to her supervisors severe verbal and physical harassment. Management conducted only limited investigation, including interviewing the alleged perpetrator. The accused denied any such problems. The investigation halted, but the harassment continued. The complainant so informed management, but no further investigation was conducted.

The circuit court was particularly critical of management's failure to take reasonable care to investigate or stop civil rights violations, failure to record on a systematic basis counseling of employees for engaging in harassing conduct, ignoring reports of harassment, relying on unsubstantiated reports, and maintaining policies that the court viewed as punishing victims and discouraging the reporting of civil rights violations.

On the other hand, responsive and alert employers have been able to avoid liability by responding quickly and appropriately to employee allegations:

In Hill v American General Finance, 218 F.3d 639 (7th Cir. 2000), the court approvingly noted that the employer acted with "commendable alacrity in almost a textbook example of what is supposed to happen" in responding to supervisory behavior that was described as "ignorant and loutish." The employer testified that the complainant had been put on notice that the human resources office was responsible for making sure there was no sexual or racial harassment of employees, and the complainant testified that she knew she could complain to H.R. if there was a problem, and that was precisely what she did.

The company conducted an investigation within two days of her complaint. The investigation was conducted by both human resources counsel and outside counsel. Disciplinary actions consisted of demotion, training and a written warning, and the complainant was transferred away from the alleged perpetrator. The Seventh Circuit found that the company's conduct satisfied the standard to avoid vicarious liability for a supervisor's acts as set forth in the landmark companion cases Faragher v City of Boca Raton, 524 U.S. 775, 118 S.Ct. 2275 (1998), and Burlington Indus. Inc. v Ellerth, 524 U.S. 742,118 S. Ct. 2257 (1998).

As the above examples suggest, a "textbook" response to an employee allegation of harassment shows that the employer is taking the allegation seriously.

Of course, an employer must already have in place an adequate anti-harassment policy that tells employees and supervisors that harassment of any sort is prohibited, where to go with problems, and tells employees that they have a duty to alert the company if they perceive problems.

Development and promulgation of an effective anti-harassment policy is a broad topic deserving significant attention and is beyond the scope of this article. (As a point of departure, however, check out the EEOC's Web site at www.eeoc.gov/docs/harassment-Facts.html, for some useful points about policy development.)

Once an allegation of either sexual or racial harassment surfaces, the ideal employer response will involve:

  • making a prompt and thorough investigation;
  • immediately implementing whatever remedial and disciplinary measures are identified as a result of the investigation;
  • letting the complainant know the outcome of the investigation; and
  • protecting the complainant from retaliation, both during the investigation as well as after. (If necessary, consider placing the complainant or alleged perpetrator on nondisciplinary paid leave pending resolution of the matter.)
Some immediate issues that you, as counsel, should raise as the employer gets ready for an investigation are: Who will investigate? When? How? And what kind of documentation should be maintained?

Many employers assign investigative responsibilities to senior staff or to human resources staff. Although not inherently poor choices, it can be difficult and awkward for people to investigate people whom they know, with whom they share a history, and with whom they may hope to share (or hope to avoid sharing) a future. Also, the more salacious the allegations, the more embarrassing it can be for someone who knows the parties involved to ask the necessary questions. In such cases, an independent investigator who is grounded in employment law and investigative fundamentals may be a logical choice.

On the down side, an independent investigator probably won't have the same level of familiarity with your client's organization and mission, compared to an internal staffer's knowledge. As such, an independent investigator will need time to "ramp-up" their familiarity with your client. Designating a point of contact, perhaps someone in the human resources office, to orient - but not to influence - the independent investigator can expedite that process.

Some employers, acting on advice of their counsel or uncertain of their own staff's confidence, neutrality or competence, have successfully used outside counsel to conduct investigations. The paramount reason employers should use counsel other than their own lawyers is that there always is the chance that the investigator will be called to testify as a fact witness in any ensuing litigation, thereby disqualifying that counsel from representing the employer in the litigation under the laws of most (if not all) states.

A lawyer/investigator's relationship to the employer and its regular counsel can be structured in either of two ways: as either a "special counsel," or as an "independent investigator/fact witness." As special counsel, the investigator's work product, including the final report and notes, may be protected from discovery as attorney work product as well as under the attorney-client privilege.

Protection of the investigation using these measures would probably not be the most typical objective, however. The more common objective would be to structure the relationship with the intent of using the investigator's testimony, notes and report to support the employer's affirmative defense. As such, the relationship between the investigator, the employer and counsel for the employer should be established with an eye to reinforcing the investigator's independence and neutrality, as well as having an investigator available to testify as a fact witness without disturbing the attorney-client relationship.

Clearly, employers need to respond to employee allegations quickly and expediently. As important as it is for an employer to act with dispatch, it is equally important to document that timeliness. If there are any delays, the reason for those delays should be documented, particularly if they are beyond the employer's control. The first portion of the investigator's report is a good place for that type of information, and as such should include a chronology of events that led to the investigation, as well as the timing of the initial investigative steps and contact with the investigator.

It is critical that each person interviewed should be told that the investigator is working for the employer and that the purpose of the interview is to gather information that will be passed back to management. I typically advise those interviewed that I'm gathering information at the request of management and for management's review, and that efforts will be made to restrict my report to those who have a need to know its content, but that my objective is to gather information for upper management's consideration and possible action, so confidentiality cannot be guaranteed. I do assure those interviewed, however, that management has promised that no retaliation will occur for sharing information with me.

The success of an investigation can depend on the investigator's interviewing skills. Less seasoned investigators may cling to a script; more experienced interviewers will use sound interrogation techniques, including:
  • demonstrating respect for the speaker;
  • listening closely, focusing on what is being said as well as what is not being said;
  • asking follow-up questions in response to an interviewee's tone and innuendo; and
  • allowing plenty of lingering silence for the interviewee to fill.
It is also useful to summarize the interviewee's important points periodically to see whether he or she agrees with your synopsis or will expound on whatever it is you've said that you heard.

The choice of people to be interviewed also will affect the success of an investigation. I typically interview the complainant first, followed by those identified as witnesses or who may be in a position to corroborate or dispute various points. Then I interview the alleged perpetrator, and swing back to do any necessary follow-up interviews.

In many cases, time and energy will not permit the interview of every employee in an affected work unit, so choices usually must be made. I have also found it useful to watch for and to interview people who have been in a position to observe whatever workplace dynamic is in question, but who are not personally involved in the particular fracas. Testimony from such disinterested and relatively uninvolved witnesses has in my experience provided valuable perspective in corroborating or sorting through conflicting commentary.

Each interviewee's commentary must be considered for bias and motivation, and even the minor details of each person's observations may be useful to corroborate or cast into question the commentary of other witnesses.

In one investigation that I conducted, for example, the outcome was influenced by the fact that the alleged perpetrator adamantly denied having had personal conversations of any sort with his subordinates, yet a former employee mentioned, almost as an aside, that when he had asked her for sexual favors, some were requested as his "birthday gift." This birthday-gift detail fit perfectly with the chronology of events in general, fit with the alleged perpetrator's actual birth date, and contradicted the alleged perpetrator's flat denials of personal conversation with subordinates.

No matter how many people are participating in an interview, only one set of notes should be made for each interview; even slight discrepancies between notes made by different interviewers may be construed to cast doubt over the reliability and credibility of all the notes and recollections of what was said in the interview.

What kind of report should be generated, and what should you and your client do with it?

The investigator's report has only a few appropriate uses. To minimize concern about invasion of privacy and defamation allegations, your client should be counseled to control access to the report and any attachments and to make copies only as absolutely necessary. The report should be captioned as "confidential" and recipients should be advised to handle it in an appropriate manner.

Even still, however, there will be times when you will want to share the report with appropriate but limited parties - including yourself as counsel, selected decision makers, and possibly government agencies. The report may also become evidence in litigation. When reports are presented to an unemployment agency, to a civil rights agency such as the EEOC, or presented as evidence in litigation, counsel should look to the relevant law of qualified immunity to verify the protection that may be afforded.

The employer will benefit from reviewing a detailed summary of each interview to better understand the nuances of what's happening in its workplace. Personal experience suggests that detailed interview information buttresses the report and provides management with greater confidence as it deliberates, and then delivers any necessary sanctions. To protect privacy, while at the same time providing the level of detail that makes a report useful, the body of the report itself can be limited to a chronology of events, a summary of information gathered, assessments of the credibility of the interviewees, and findings of fact and recommendations.

Gritty details can be reserved for an appendix, along with the investigator's observations about each interview. This allows the employer to circulate the more summary report as may be necessary, and also protect the more detailed notes. Sequestering the details in this way should reduce concern about allegations that the employer's investigation or subsequent handling of the report has created an invasion of privacy or has constituted a defamation of character; at the same time such a detailed appendix serves the employer's need for detailed information.

It is important that an employer inform the complainant of the results of the investigation, and that the employer monitor workplace assignments to ensure that no retaliation occurs or is possible. Steps like these constitute a follow-through that, depending on the facts, may be very important in establishing compliance with the Civil Rights Act and similar statutes, as well as being beneficial to workplace morale.

In terms of morale, employees often view the investigation as a tangible expression of their employer's concern about work conditions and the workplace, and they sometimes need to hear from the employer to make closure possible to what in some instances may have been a very traumatic episode.

Telling involved parties what particular action will be taken as a result of an investigation, along with a request for help in controlling unnecessary discussion in the workplace, eliminates the perception that the employer is all talk and no action, and also may help control the rumor mill.

My experience has been that the workplace rumor mill works overtime when allegations are made and when an investigation is conducted. It seems to be impossible to conceal the fact that an allegation has been made, or that an investigation is underway. It may well be more productive to be open with the work force and say that management supports the investigation and seeks its employees' cooperation; communication of this sort has the potential to both clear the air and reinforce a positive managerial image.

A "textbook" employer response to employee allegations of harassment of any sort potentially can limit employer liability. Some employers, under advice of counsel, have begun to retain independent counsel to conduct workplace investigations, while others are ably handled "in house" by the employer's counsel or human resources office.

Regardless of who conducts the investigation, to be effective, an employer must have an appropriate anti-harassment policy in place, and the employer's response must be initiated soon after an allegation is made known. An effective investigation will reflect that the employer has taken the allegations seriously and has subsequently protected the complainant.

The choice of investigator is important. The investigator should be comfortable and grounded in the basics of interviewing, able to ask difficult questions, and be familiar with employment law fundamentals. With the proper investigator to create a good record, a responsive employer can hope to avoid liability, and at a minimum establish a viable affirmative defense to employee allegations of harassment.

Buckleitner practices employment law in St. Joseph, Mich., and conducts workplace investigations. Her e-mail is abuckleitner@cs.com.

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