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Seven steps to follow when investigating misconduct allegations

It’s a typical day in the office as you go through your normal routine. But then things change abruptly when you receive a report on your company’s ethics hotline that an employee is defrauding the company.

If you are called upon to lead an investigation into such a matter, where do you start? What steps should you take and in what order to ensure you perform this work in a professional and efficient manner? How can you best ensure fairness in the process?

Providing complete answers to these important questions is beyond the scope of this short essay. For this reason, if you are not experienced in performing investigations, I recommend you seek the guidance of a trained investigator to assist you when the need arises. By way of introduction, the following are seven steps you should take every time you are called upon to investigate allegations of workplace misconduct:

Step 1: Review the allegations and preserve evidence
The first step in conducting an investigation is to make sure you understand what is being alleged. Oftentimes, individuals who make reports of misconduct via company ethics hotlines make statements that contain several allegations of misconduct against multiple individuals. Before you take any steps to investigate such allegations, you should read them very carefully to ensure you don’t miss anything.

You should also take stock of what is not being provided. Ideally, reports of misconduct should contain detailed descriptions of who did what when as well as a list of possible witnesses and a collection of associated documents corroborating the allegations. Unfortunately, this is the exception rather than the rule. More often than not, ethics hot-line reports are missing much of this key information. If this is the case, you may have to ask the reporter for more information before you can make any headway in conducting an investigation.

Following this initial review, you should take immediate action, as may be required in the circumstances, to prevent the spoliation of evidence. This may involve seizing electronic equipment, changing locks on office doors, preserving videos, imaging email servers or accounting records. Regardless, don’t wait until you have a perfect investigation plan to save perishable information you’ll likely need to determine what happened.

Step 2: Draft an investigation plan
When you receive an allegation of workplace misconduct, it is important to resist the natural impulse you may have to rush out and launch an investigation. Instead, the smart thing to do is to close your office door and start writing down an investigation plan. This plan should include:

  •  A list of the resources you will require to perform the investigation, including the individuals you may need to work with you. In some cases, this may include law enforcement authorities and/or legal counsel;
  •  The identification and review of relevant company policies and procedures;
  •  A list of possible sources of evidence such as witnesses, physical evidence, photographs, videos, emails, electronic and paper files; and
  •  A table or spreadsheet outlining the steps that will be taken to perform the investigation, the individuals responsible for each activity and target completion dates.

Investigation plans will vary in complexity depending on the nature of the case. But regardless of whether your plan is 10 or 30 steps long, you will never regret taking the time to think through and document what you are going to do and how you are going to get it done.

Step 3: Execute the investigation plan
When putting your plan into action, be sure to:

  •  Keep an open mind rather than jumping to conclusions. Remember, as an investigator, your job is not to prove the allegations are true or false, but simply to determine what happened in an objective and professional manner;
  •  Be mindful of and compliant with applicable legal restrictions on what you can and cannot do in conducting searches; and
  •  Take good notes and keep the evidence you gather well-organized and stored in a secure location.

Step 4: Analyze evidence and reach a conclusion
Once all the evidence is gathered, it is time for you to sort through it and draw conclusions about what you know and what you don’t know. In so doing, it is entirely appropriate to take into account the relative credibility of witnesses who have differing accounts of events and to assign more or less weight to other pieces of evidence based upon their nature and reliability.

Step 5: Record your analysis in a written report
Regardless of whether you conclude that the allegations of misconduct were substantiated, you should take the time to write a formal investigation report that contains the following key elements

  •  A summary of the allegations;
  •  A summary of steps taken to investigate the allegations;
  •  Analysis of the evidence gathered;
  •  Conclusions reached; and
  •  Recommended responsive actions.

Step 6: Update your case management system
If your company’s ethics hotline is like most, it includes a case management system in which you can store your investigation notes, upload your final investigation report and indicate the case status. Once the investigation is completed, it is important to update the case management system so a complete record is kept of the case status and outcome.

Maintaining an accurate and up-to-date case management system will permit you to respond to questions that might arise about the investigation and conclusions reached and also will permit management to run meaningful reports to evaluate possible trends associated with workplace misconduct in your company.

Step 7: Follow up with the reporter
Regardless of your investigation’s outcome, you should get back to the reporter to at least let her know that the investigation has been completed and appropriate steps were taken in response to the findings. It may not be appropriate in some circumstances to share with the reporter details regarding your firm’s response to the investigation findings. However, by letting the reporter know that his report was taken seriously and that an investigation was conducted, you will build confidence in your firm’s ethics hotline and encourage its use.

Jim Nortz is chief compliance officer for Carestream Health Inc. He also is a former board member of the Rochester Area Business Ethics Foundation and the Ethics and Compliance Officer Association. The opinions expressed in this article are his alone and may not reflect those of the RABEF, the ECOA or Carestream Health. Nortz can be reached at jimnortz@gmail.com.

9/4/15 (c) 2015 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email rbj@rbj.net.

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