While not all investigation reports into workplace complaints are intended to be protected by legal professional privilege, there are some key criteria to satisfy if that is in fact the intention. A recent case from the Fair Work Commission (FWC) illustrates that there is no issue at all with an external workplace investigation being privileged provided it meets certain tests.

Case facts

In Tainsh and Willner v Co-operative Bulk Handling Ltd [2021] FWC 3381 the FWC examined a claim for privilege over an investigation report into a workplace complaint of bullying undertaken by an external consultant. The findings of that investigation ultimately formed the basis of the reason for the dismissal of the two employees. In a common arrangement, that consultant had been retained by the employer’s external legal advisers to undertake the investigation for the purpose of them providing legal advice to the employer in relation to the complaint.

The employees argued instead that the purpose of the investigation was for the employer to comply with the investigation procedure in the Company’s policies for handling such matters.

The FWC decided that because of the clear terms of reference in the Investigation Protocol provided by the lawyers to the consultant investigator which identified that the dominant purpose of the investigation was to allow the lawyers to provide legal advice and that there had been no departure from those terms in subsequent conduct, the report and ancillary documents were in fact privileged. This decision was consistent with earlier cases.

What are the factors that need to be considered?

It is vitally important to remember that privilege will only attach if the investigation is established correctly.  Further,  just because an investigation starts off as privileged it doesn’t mean that this status cannot be waived by the parties as the process progresses.

Tips for establishing and maintaining privilege

Use a law firm or in-house legal counsel to brief the investigator. Where HR engages an external investigator to undertake an investigation it cannot be privileged unless that investigator is in fact a lawyer and is being retained for the dominant purpose of providing legal advice. The safest means of engaging an investigator is to do so via a lawyer (either internal or external) as the investigation report is then being produced to the lawyer so that the lawyer can provide legal advice to the business.

Be crystal clear on the dominant purpose of the investigation. This should be reflected in all communications including the instructions to the lawyer, the terms of reference or protocol drafted by the lawyer and provided to the investigator.

Terms of reference are key. The terms of reference provided to the investigator by the instructing lawyer have to clearly state that the dominant purpose of the investigation is to allow the lawyer to provide legal advice to the employer about the complaint. The investigation should be limited to findings of fact only as to whether the allegations are in breach of the specified policies or laws.

Once the investigation is underway, the investigator should be communicating through the lawyer only, consistent with the purpose of assisting in the provision of legal advice. There should be no direct liaison between the investigator and the business except for minor logistical matters.

Be careful with communications to employees about the investigation. Ensure that all communication is consistent with the terms of reference of the investigation. Care should be taken with referring to the process as an “independent investigation”. While this may be true, it suggests a dominant purpose other than the provision of legal advice and has been held in the past to be a waiver of privilege.

Always keep processes separate. Ensure that investigation and its findings are separate to any disciplinary procedure which may flow from the advice received about the investigation findings. Remember that the purpose of the investigation is to give the legal adviser information such that they can advise the employer. It is then up to the employer to consider all the factors to come to a decision as to the appropriate action. A decision should not only be based on the investigation findings but the employer’s consideration of those findings when considering the whole picture. This must also be reflected in communications about the decision.

Do not have a policy which dictates how and why an investigation may be conducted. Best practice grievance procedures allow the employer flexibility to choose whether or not to investigate complaints and how those complaints may get investigated.

Do not communicate to employees during an investigation that it is being conducted as part of “company policy” or in accordance with the employee’s wishes. It is acceptable for an investigation to have a dual purpose and still be privileged. For example, the FWC has previously held that an investigation undertaken for the purpose of obtaining legal advice and for the purpose of complying with company policy was still privileged as the former was the dominant, or overriding purpose.

Ensure that the investigation report when provided by the legal adviser is distributed on a “need to know” basis only. It is a confidential document and should be treated as such.

When disclosing the findings of the investigation to the employee involved be careful. Language used should reflect that it must be for the limited purpose of allowing them to respond in relation to the disciplinary process which may result. This should only ever be done by the employer and not the investigator.

 

Alice DeBoos
Managing Partner
+61 2 9169 8444
[email protected]