Rarely a day goes by without at least one report of workplace misconduct hitting the headlines globally. In a post-#MeToo era, there is an ever-increasing focus from society on how organizations respond to and deal with allegations of abuse and harassment.
In the last few months alone, a vast number of organizations have been the subject of front-page news following reports of serious misbehavior. It is not only the individuals accused of these behaviors that make headline news; these stories also focus on alleged organizational failings to effectively respond to and investigate these behaviors when they are reported.
Inadequate management of sensitive workplace allegations can lead to reputational devastation for companies resulting in damage to the brand, loss of stakeholders, and often, very public litigation. Recent public reports concerning sectors such as financial services, sports, humanitarian, insurance, and media, to name just a few, demonstrate this is a reputational risk facing every single organization.
For most companies, there is some level of investigative framework in place to respond to all aspects of misconduct and for some, a level of investigation may have taken place prior to a story breaking.
So why then, is the risk still so prominent for organizations when presented with these types of issues? This article sets out the common pitfalls for organizations when tackling workplace conduct investigations and what needs to be considered to minimize reputational impact.
Challenge 1: Avenues for Reporting
One of the first and most crucial elements in dealing with harassment and abusive behavior is establishing an appropriate reporting mechanism. Due to the sensitive nature of these issues, people are often reluctant to come forward for fear of reprisals or inaction, especially when reporting avenues are limited in defining behaviors, inaccessible, or lacking impartiality.
Reports of offenses that are sensitive (e.g., sexual in nature) are often traumatic for the complainant to describe. The design of reporting channels needs to consider a safe environment to ensure people feel comfortable reporting sensitive issues. When reporting mechanisms are poorly designed or implemented, reports may go undetected, which can lead to systemic behavioral issues and a poor workplace culture. This also increases the risk that reports will be made public.
Challenge 2: Establishing Responsibilities
Organizations may lack clarity on the internal function responsible for managing behavioral issues when they arise. Most companies consider any issues concerning employee behavior as grievances that would naturally be directed to the HR department. However, where reports require investigation, this may fall to other internal functions responsible for investigating all breaches of company policies (e.g., compliance, general counsel, internal investigations).
We often observe gaps in organizational frameworks to define responsibilities when managing behavioral misconduct reports. When this is not made clear, responses to allegations are not timely or are even missed which can leave reporters feeling neglected, further impacting the organization’s reporting culture.
Designating the management of sensitive allegations to a specific function or case officer as a first point-of-call is advised. This can be, and often is, HR’s responsibility. However, where an investigation is required, there are several factors to consider, such as the risk of retaliation or victimization, the severity of the behavior including whether a criminal offense has occurred, seniority of the individual(s) accused, the period of the alleged behaviors, the number of reporters and/or potential victims, and, for regulated sectors, reporting obligations, all contributing to reputational risk. Workplace investigations often require input from multiple stakeholders, including in-house counsel and compliance functions to ensure the impact of any reputational risk can be appropriately managed.
Challenge 3: Testing In-House Experience
In our experience, most in-house teams have limited exposure to conducting sensitive investigations. Although many large organizations have internal investigation skill sets, these have historically focused on financial or transactional-related misconduct. In contrast, HR functions have relevant experience in dealing with people matters but usually have never conducted an actual investigation into such issues.
Providing internal teams with adequate training and/or engaging experts with experience investigating behavioral misconduct ensures the investigation is approached in the right way, including sensitively interviewing reporters and witnesses. Investigators often face challenges in identifying sources of independent evidence to either corroborate or refute the allegations and there is a substantial reliance on interview testimony as evidence. Without experience, organizations run the risk of obtaining incomplete accounts and may miss opportunities to gather further evidence. This affects the standard of the investigation and can lead to further grievances and legal costs.
Challenge 4: Demonstrating Independence
Even where in-house functions have experience conducting sensitive workplace investigations, the very fact they are working for the company can be perceived as prioritizing the company’s interest instead of the alleged victims. Furthermore, describing such sensitive topics with people working within the organization will be quite uncomfortable for alleged victims and witnesses. The subject of the investigation will also require reassurance that the allegations have been viewed objectively and without any bias.
Depending on the nature of the matter, engaging independent experts may be more appropriate to demonstrate to employees and stakeholders that the organization has firstly, taken the reports seriously and secondly, that there is no bias and the process is fair to all those involved.
Challenge 5: Managing the Fall-Out
Organizations often find themselves in a crisis situation when sensitive workplace issues are at risk of being reported publicly. This is partly due to the extremely high and demanding expectations now set by stakeholders and the public for organizations to tackle undesirable and dangerous behaviors in the workplace.
When an investigation commences, an organization might be expected to report on the progress of that investigation and inform relevant stakeholders of the situation. Even for private companies with limited public exposure, there still remains a collective investment in how these behaviors are managed. This also means, in a governance and regulatory context, that authorities have an increasing willingness to ensure action is taken against individuals and organizations which can be damaging for business operations. Scenario planning and response to such events should, therefore, be engrained within the investigative process.
In our experience, collaboration among independent experts and internal stakeholders is paramount in ensuring the right steps are taken throughout each phase of the process, from grievance to dispute. As independent investigators, we regularly collaborate with other parties to ensure the focus of our investigation considers any anticipated legal outcomes and where media coverage is likely. This ensures reputational impact is considered during the investigation phase and not as an afterthought.
For more information on how your organization can best prepare itself to respond to sensitive misconduct in the workplace, please contact Charli Curran, Senior Director.
© Copyright 2023. The views expressed herein are those of the author(s) and not necessarily the views of Ankura Consulting Group, LLC., its management, its subsidiaries, its affiliates, or its other professionals. Ankura is not a law firm and cannot provide legal advice.