Nestlé’s dismissal of its chief executive Laurent Freixe for an undisclosed affair with a direct report has highlighted the effectiveness of workplace investigations. Kate Kapp, partner at law firm Doyle Clayton, examines how organisations should best scrutinise alleged misconduct.
This week’s dismissal of Nestlé’s CEO, Laurent Freixe, following an “undisclosed romantic relationship”, has once again brought to light the essential role of investigations in the workplace.
While the board seemingly responded effectively once the investigation into Freixe’s relationship with an employee was confirmed to breach its code of business conduct, the process was potentially unnecessarily protracted because of a failed initial internal investigation.
How can organisations manage investigations effectively – to adhere to employment policies, sustain their culture, and ensure that employee trust and customer confidence remain intact?
The rise of workplace investigations
The scrutiny surrounding workplace behaviour is very much on the rise. This follows new employer responsibilities expected within the Employment Rights Bill and greater regulator focus.
Workplace investigations
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As a result, we’re increasingly seeing the benefits of organisations appointing an external investigator for internal allegations at an early stage.
This is particularly key when the allegations are of a serious or sensitive nature, are complex – for example, sexual harassment or allegations of discrimination – or if they involve senior individuals.
An external investigator will ensure that the investigation is conducted impartially and holds integrity. This is particularly important in regulated environments, the public sector and where there is a risk of reputational damage.
Factoring in the current fallout of Freixe’s dismissal – drawing more attention to an already challenging year for the company – means the Nestlé board may currently regret accepting the “unsubstantiated” findings of the initial internal investigation.
Working with external investigators
The benefits of HR teams engaging an external investigator are clear. First off, you have access to the skillset and experience of specialist lawyers who are experts in the potential legal disputes that could arise from the allegations under investigation. This is particularly important should the complaint relate to sexual harassment, where organisations need to demonstrate compliance with the preventative legal duty introduced a year ago.
Because investigators will be skilled in the sensitive, yet robust questioning techniques needed for this level of process, the outcome is inevitably a more rigorous and impartial investigation. Again, this means you can demonstrate organisational compliance to both external regulators and stakeholders. In Nestlé’s case, what’s clear is that the internal investigation wasn’t thorough or independent enough.
An external investigating team will also be able to safeguard the company’s reputation and damage limitation, especially where allegations are likely to attract a lot of media attention.
Communicating investigation outcomes
This is an essential step in effective investigation management. How to communicate the outcome of an investigation will depend on who the outcome is being communicated to.
If someone has raised a formal grievance, they are entitled to receive an outcome letter, detailing the steps of the investigation, the evidence obtained and the findings. They will also have the right to appeal this outcome. Any appeal must be dealt with by someone who has not had any involvement in the original investigation and preferably is someone more senior (or another external investigator).
Communicating investigation outcomes more widely needs to be managed sensitively. There’s the requirement for the company to act cautiously as they will be under a duty to preserve confidentiality in respect of those who raised the complaint, are witnesses to the allegations, and those who are the subject of the investigation.
Companies will want to strike the right balance between ensuring that other stakeholders – employees, investors, shareholders – understand that a robust, impartial investigation took place and that the allegations were taken very seriously, while preserving the confidentiality of those involved. It is recommended that specialist advice is taken to ensure that these communications are appropriate. Again, this is an area investigators can support if you appoint a legal team.
What’s essential here is also communicating your organisation’s response to the investigation – beyond the immediate steps involving those involved.
Leading change
Where wrongdoing has been found on conclusion of an investigation, and perhaps where issues relating to behaviour and culture have been identified, it is important for business leaders to issue clear and transparent communications regarding any shortfalls and the remedial steps that will be taken. Key will be invoking other internal processes based on the outcome of the investigation, for example, the disciplinary process.
In the recent Nestlé case, the board can be seen to have acted quickly, decisively and seemingly with no exceptions, despite Freixe’s 40 years’ service and seniority.
Because investigations can also bring potential cultural or systemic failings to light, it is the perfect time to revisit policies and procedures. For example, do these need updating? Revisit risk assessments and put in place adequate training to ensure that existing employees restore their trust in the organisation – and can see they are part of the change. Company values should also be reinforced.
It is also important that anyone affected by the investigation or the allegations that formed its basis receives adequate and meaningful support.
Every workplace investigation is different, presenting unique sensitivities, dynamics and complexities that must be managed fairly, lawfully and considering the risk of legal complaints and longer-term reputational harm.
They are also incredibly difficult processes to lead, involving deeply personal issues – there’s a lot at stake. For HR, this is about how you can best be supported and guided by specialists to ensure you comply with your legal obligations, support organisational integrity, compliance and create a safe working environment and positive culture for your people.
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