Politics & Law
HR investigations rising in importance
By John Eastwood, Heather Hsiao and Nathan Snyder
In the aftermath of the Covid-era economic concerns and travel restrictions, many multinationals are taking a closer look at what’s been happening in their overseas operations. In some cases, that may mean a deep dive into the conduct of executives based here. In some cases, such as those involving sexual-harassment allegations, there can be specific legal requirements that the company needs to follow. However, global companies often need to balance the importance of keeping their local business operations running while making sure that they run operations in a fair, above board and legal manner.
The importance of efficiency
Companies will often become aware of potential or actual wrongdoing via whistleblowers or other evidence. It is important to run investigations ethically, professionally, and swiftly, before evidence disappears or memories fade. An investigation needs to be run neutrally and fairly, without a pre-planned result or conclusion, but it must also be done efficiently. An investigation that drags on and becomes a “fishing expedition” can interfere with business objectives and create unnecessary animosities within the workplace.
In the course of investigating one aspect of conduct, it is likely that an investigator may come into contact with additional issues or problems. Most companies have rules requiring employees to cooperate and be truthful regarding investigations, so the simplest versions of this stem directly from the course of the investigation:
- a complaining employee, witness, or investigation target has lied and fabricated evidence; or
- a manager or employee has attempted to interfere with the investigation.
We have sometimes found that the efforts to impede an investigation were more actionable than the original issue ever would have been. One of our most memorable cases involved a multinational company’s Taiwan in-house counsel who sent an email to warn his country manager that he was under investigation, and that the corporate IT staff were reviewing his email communications! Another case involved a country manager who emailed investigation interview participants to tell them not to discuss the investigation with any colleagues – but then privately briefed them on what she wanted them to say. We caught onto this when the first few employees used identical phrasing within the first 10 minutes of each interview. In our work with many multinationals, we have seen many senior executives terminated for lies and coverups for conduct that would not itself have led to discipline.
It is important to maintain an investigation’s focus. It is common for personnel who face investigations to raise allegations of wrongdoing by others. If the allegation is directly related to the current investigation, then of course this is not a diversion, and may warrant a follow-up. However, unrelated matters cannot be allowed to derail an investigation. If something unrelated is raised which may give rise to legal liabilities or other problems for the company, then these matters should be reported onwards for the company’s consideration as to whether to open a separate review or investigation, but they should not become the focus of the current one.
Correctness is essential
An office under investigation often cannot heal and return to productivity if an incomplete investigation is done. Reaching the correct result in these situations requires approaching the work without a preset agenda. The result of an investigation should be a report that demonstrates enough fairness, truth, and contextual understanding that all persons reading it can see the essential correctness of its conclusions. In our casework experience, we have sometimes been able to clear executives of wrongdoing by unravelling misunderstandings, or confirming that a complaint was made in bad faith. In other cases, an investigation into one employee’s potential misconduct can uncover a range of unhealthy management practices. In many cases, the investigation can never get the complete truth of what happened, but at least we can come close to knowing what most likely occurred.
Companies are sometimes guided in the wrong way. We were once brought in to provide a second opinion on a matter in which a male senior executive, who was having an extramarital affair with a female personal assistant, beat the assistant so badly she had to be treated in hospital. The previous advisors to this company had suggested that, instead of focusing on the appropriate redress for this woman, the company instead focus on the consensual nature of the original relationship, and the fact that the beating happened outside of the office, in order to leave the senior executive alone while punishing the assistant for using the company e-mail system to send an angry message to her abuser. Obviously a second opinion was warranted there.
Sexual harassment investigations
Sexual harassment in the workplace can be divided into two types under the Gender Equality in Employment Act (GEEA). The first type is hostile-workplace sexual harassment, which occurs when an employee is at work and an employer, co-worker, or customer uses sexual advances, or sexually explicit or sexist words or behaviours to create a hostile, intimidating, or offensive work environment, which infringes or interferes with the employee's personal dignity and personal freedom or affects the employee’s work performance.
The second type in the workplace emphasizes the role of a power dynamic (namely the relationship between superiors and subordinates). In this type, an employer uses the power of their position to make explicit or implicit sexual demands, makes sexually explicit or gender-discriminatory remarks, or uses any other verbal or physical conduct of a sexual or gender discriminatory nature towards employees or job applicants as an exchange for some employment-related benefits.
In order to prevent employees from suffering continuous sexual harassment, the following three situations are also included in the enforcement scope of the GEEA:
- Suffering from continuous sexual harassment by the same person in the company during non-working hours;
- Suffering from continuous sexual harassment during non-working hours by the same person within other entities which the company works with or has business relationships with;
- Suffering sexual harassment from the top responsible person or employer during non-working hours.
Upon becoming aware of any incident of sexual harassment, GEEA Article 13 requires employers to undertake corrective action and remedial measures while caring for the safety and privacy of victims. The law positions employers to be on the side of the victims. Employers are required to help victims with filing a grievance and preserving evidence and notifying police if necessary. Employers must also review the safety of the place where an incident has occurred. Under Article 36 of the GEEA, during the course of investigating and reviewing a reported incident, an employer must not act in any discriminatory or retributory manner toward the complainant or any employee who assists others in filing complaints.
Similar provisions are also found in the Sexual Harassment Prevention Act.
Don’t “BYOD”
In recent years, it has been fashionable for companies to let employees “bring your own device.” The reason is ostensibly because the employees will be happier using the brand of phone, tablet or computer they prefer. The problem with this arises during an investigation of wrongdoing or in the aftermath of a termination: employers have little to no control over these devices. An employer may be able to shut off intranet and email access to ex-employees, but it is difficult, to the point of impossibility, to get timely access to any electronic device that does not explicitly belong to the company.
A few years back, a European company used monitoring software to confirm that one of its Taiwan employees was leaking their trade secrets – future product plans, specs, designs, etc. – by copy/pasting them into private emails sent from his work computer. In another matter, a European company discovered that a recently fired employee’s still-powered-up Apple phone was displaying new messages in which secrets were being offered between the ex-employee and a competitor’s manager in the People’s Republic of China. These cases turned out well, but their results hinged on the company owning the devices and having full access to them.
Messaging Apps in the office
A lot of managers wrongly think that just because they used WhatsApp or Line to send horrible messages to employees, it is “private” and can’t be reviewed by a court. We’ve seen aggrieved employees pull out binders filled with hundreds of pages of messaging screenshot printouts, all of which could be produced at trial. Conversely, we have seen employees present very thorough defences against misconduct allegations with similar messaging screenshots to demonstrate context and timing. Within many offices, there are informal messaging groups that, when abused, can be filled with content that can be defamatory and poisonous to a good working environment.
What to do if you’re in an investigation
In addition to our work for multinationals, we have sometimes been hired by senior managers to counsel them on how to respond to an investigation. It is important to be honest, not to lie, to provide documents and information that will shed light on what happened, and to engage with the process in a good-faith manner. Establishing a chronological timeline is important, and organizing email copies and message screenshots to allow an appropriate and clear explanation is essential.
We have cleared a significant number of managers from allegations of wrongdoing, both in our role as investigators acting on behalf of the company or in our work as advocates for the executives. In these cases, the managers engaged with the investigation in an open and forthcoming manner, provided context, and did not hide or mischaracterize evidence.
From the complainant's side, it is important to speak up when something wrong happens, and it’s important to be fair and accurate in characterizing the actions and communications, both in the complaint and in the investigation process afterwards. The global policies used by multinationals and Taiwan’s laws have gradually evolved to support an environment where employees can speak up and be heard.
John Eastwood and Heather Hsiao are partners and Nathan Snyder is an associate at Eiger, the Taipei-based law firm, with extensive experience in employment law matters.
