$1M Arbitration Award for Shoddy Investigation

I am hoping the title of this post got your attention.  I was retained as an expert for the plaintiff in a case that alleged a poor investigation, breach of implied contract and defamation.  Last week the arbitrators awarded the plaintiff  $1M. Yep, one million bucks.

For over 15 years I have been an investigator and have spent considerable time over the years training HR and others how to conduct investigations.  Before that, I was a management side employment attorney.  I feel compelled to share some of the major mistakes made by the employer along with the HR Director who conducted the worst investigation I have ever read or heard about in my career.

Key facts:  Jim (the plaintiff) is accused of concealing facts regarding a co-workers fraudulent expense report. The real wrongdoer, Ed, (hey, I don’t have to be impartial) used Jim and his clients as part of his cover-up for his expensive dinner with his wife.  Jim consistently told his manager and others he was not at the dinner.  The matter is dropped. Months go by and then management starts digging around and does a further investigation into Ed the wrongdoer’s expense report. HR Investigator Mike is now brought in to do a more formal investigation. Let’s go over some of the highlights of the investigation:

1. Investigator Mike spent 7 minutes on the phone with Jim to ask about his version of the facts. (We know this from the phone records.) My position is I would have spent about 7 minutes introducing myself, going over admonitions and then getting into the questions. Oh, right, did I mention the HR Mike didn’t introduce himself? He felt Jim should remember him from when they met on Jim’s first day over a year before.  Oh, right, did I mention at the end of the call Jim asked, “who are you again?” Investigator Mike felt the question was a clear sign of deception.  Huh?

 Tip: I recommend that an investigator introduce himself or herself to the witness. Even if you know the witness, complainant or alleged wrongdoer, explain your current role as the Investigator.

During an investigation interview, many witnesses are nervous and it can be the first time they are learning of the nature of the investigation. In the situation involving the alleged wrongdoer, the interview is often the first time they learn they are the subject of the investigation. 

 Additionally, I am comfortable stating unequivocally that an investigator cannot interview an alleged wrongdoer in seven minutes. Nope, can’t be done.  In California and other states, investigations must be done in good faith. That means giving the alleged wrongdoer an opportunity to answer the allegations against him or her.  Moreover, the investigator must flesh out any inconsistencies, show documents or other evidence for review, dig deep to understand the alleged wrongdoer’s views and assess credibility.

 Finally, if you think the witness is deceptive – you must, yes, you must ask questions to further uncover information to support your conclusions. In other words, just having a “gut” feeling isn’t enough. Without more questions – shoddy investigation.

2.  Investigator Mike only makes cursory notes of the interviews he conducted.  The seven-minute interview was only one-half page of notes.

Tip: Take good notes! You may think you have a good memory. You don’t.  Can you take down every word like a court reporter – of course not. However, you must make an effort to make as accurate a record as possible of the interview responses. Do what you need to do to take better notes: get the witness to talk slower, occasionally read all or part of your notes to the witness to make sure you are as accurate as possible, stop the witness from speaking until you are done writing and make sure you can read your writing.

3.  One of Investigator Mike’s entries from his interview with Jim stated: “Admits he wasn’t at the dinner nor his clients. ‘You can put the rest together.’ Would not come out and say Ed & wife were at the dinner instead.”

Tip: What Investigator Mike wrote is just plain wrong. An investigators role is to ask questions, probe, probe some more and then ask more questions. The notes should have simply reflected what Jim said – not an interpretation of what the investigator thought the witness was saying. Any analysis as to the meaning of what a witness says takes place at the end of the investigation and is included in the verbal or written report. It would have been fine if Investigator Mike wrote, “witness refuses to directly answer if Ed and his wife were at dinner.”

I could go on and on about other egregious errors made by Investigator Mike, but the key teaching point is: conduct a good faith and unbiased investigation by giving the witnesses every opportunity to fairly and completely answer your questions. Do not put your own spin on the facts, do not “read between the lines” when you have no facts to back up your conclusions. Beware: Conduct an investigation like Investigator Mike and I guarantee I will write a blog post about it.


This entry was posted in Investigations. Bookmark the permalink.

One Response to $1M Arbitration Award for Shoddy Investigation

  1. Lisa Gianelloni says:

    Very true response Allison…you have to go through the process. A manual will not give you the “drill down” or the practice required to keep asking till you have exhausted all options. There are always multiple contributing factors.

Leave a Reply

Your email address will not be published. Required fields are marked *