Introduction

Chances are good that you picked up this book because you've become aware of a potentially serious problem at your company and you're not quite sure how to handle it. Maybe you've heard a complaint or report of misconduct that sounds something like this:

"Every time I go into John's office, he's looking at porn on the Internet -- it's really starting to offend me and some of the other women in the office."

"We've finished our internal audit, and the numbers just don't add up. I think we may have a thief on our payroll."

"I've been passed over for promotion three times, and each time the job has gone to a younger person who doesn't have my experience or training. I feel like I'm being discriminated against."

"Mark has been really angry lately -- he keeps talking about his gun collection, and yesterday he told me that 'management is about to get what's coming to them.' I'm afraid of what he might do."

Now you're facing some tough decisions: Whom should you believe? What really happened and why? How serious is this problem? What should you do about it? And, can you handle this without creating legal problems for the company?

A complete, impartial, and timely investigation will help you answer these questions and figure out what to do. In fact, a proper investigation is one of the most important tools for maintaining a safe and productive workplace -- and keeping your company out of legal trouble.

This book gives you the tools and information you need to conduct a successful investigation. Part I (Chapters 1 through 4) describes in detail the ten steps to a successful investigation of any kind of workplace problem. Part II (Chapters 5 through 8) takes a closer look at four common workplace problems -- discrimination, harassment, theft, and violence -- and explains how to handle the special investigation challenges posed by each.

This chapter will help you get started. It introduces the benefits and basic components of a proper workplace investigation, including the actions you will have to take -- and decisions you will have to make -- along the way. (Each of these steps is covered in detail in Chapters 2 through 4.) It also covers some common investigation mistakes that can lead to legal trouble -- and tips that will help you avoid them.

The Benefits of an Effective Investigation

Although you might not be happy to learn that you have a workplace problem, investigating and resolving it in the right way can strengthen and protect your company. Among its many benefits, a proper investigation will help you:

• Figure out what happened. The immediate aim of any investigation is to get to the bottom of a problem. You won't know how to handle a situation until you know what really happened. And, acting before you have all the facts could lead you to discipline the wrong employee or allow a workplace problem to continue.
• Deal with employee problems early. An investigation will help you figure out who's behind a workplace problem, so you can take action before things get any worse. If you are dealing with a problem employee, he or she can be disciplined. If you discover that employees are breaking the rules because they don't know what's expected from them, you can implement training programs, work harder to publicize and distribute company policies, and make sure managers are enforcing the rules.
• Enforce company policies. If a company doesn't enforce its own policies, the company's employees quickly realize that they don't have to follow the rules. Showing employees that there are consequences for misconduct will help deter future trouble and keep employees on the right track.
• Encourage reporting. Investigating and dealing with problems quickly will encourage employees to come forward with their issues and concerns. This means that you'll hear about workplace trouble right away, before it has a chance to grow into a more serious problem.
• Avoid or counter bad publicity. A company that ignores complaints and problems gives the impression that it doesn't care about its workers or the law. And if your company's failure to deal with a problem becomes public knowledge -- through a lawsuit, for example -- it could really hurt the company's reputation.
• Protect your company from lawsuits. A solid investigation will help your company avoid or defend against legal challenges in the future. If someone who is injured by workplace misconduct -- an employee who is sexually harassed, for example -- sues your company, you can show that you took action right away, which will protect your company from liability in many cases. If an employee who was disciplined or fired as a result of your investigation files a lawsuit, you will be able to show that you acted reasonably and in good faith, which will undermine the employee's claims.

By the same token, however, a slipshod investigation can lead to employee lawsuits, by giving employees the ammunition they need to demonstrate that your company was careless, discriminated, spread false information, or treated employees poorly, among other things. And failing to investigate at all is even worse -- if an employee can show that company management knew about a problem and didn't do anything about it, the company will be legally responsible for any harm that employee suffered.

So how do you conduct the right kind of investigation? By being fair and thorough and making good-faith efforts to get to the truth. Even if you come to the wrong conclusion, your company should be able to show that it was legally entitled to take action (for example, to discipline or fire an employee) based on the results of your investigation, as long as you investigated properly and your decisions were reasonable based on the information available to you.

Example: Ralph was accused of sexually harassing two female coworkers. The company immediately performed a complete investigation, interviewing the women, Ralph, and a number of witnesses -- including five Ralph suggested. Based on these interviews, the company concluded that Ralph had in fact harassed his coworkers and fired him.

Ralph later sued the company, claiming that he had a consensual affair with both women, no harassment had occurred, and the women were angry with him for two-timing them. (Ralph did not tell any of this to the company's investigator.) The jury found in Ralph's favor. However, an appeals court decided that it didn't matter what really happened. As long as the company conducted a fair and thorough investigation and reached a good-faith conclusion based on the information available to it at the time, it was not liable for firing Ralph based on the investigation's results.

Ten Steps to a Successful Investigation

The best way to tackle an investigation -- like any other project -- is to divide it up into manageable tasks. Fortunately, most workplace investigations follow a similar pattern, although the details can vary considerably. Once you become aware of a problem or complaint, you'll have to follow these ten steps:

1. Decide whether to investigate. Although there are some situations that don't warrant an investigation, you should generally err on the side of investigating. Sometimes, you won't know how serious a problem really is until you start asking questions. Chapter 2 explains how to decide whether to investigate, including how to scale the size of your investigation to the problem.
2. Take immediate action, if necessary. You might have to act right away, before you begin to investigate, to protect employees or the company itself. For example, an employee accused of serious sexual harassment or stealing company trade secrets should be suspended, with pay, until the investigation is complete. For information on taking interim measures -- including tips that will help you avoid legal claims based on your pre-investigation actions -- see Chapter 2.
3. Choose an investigator. If you won't handle the investigation yourself, you'll need to pick someone else to do it. The right investigator is experienced, impartial and perceived as impartial by the employees involved, and capable of acting -- and if necessary, testifying -- professionally about the investigation. Chapter 2 explains these requirements, including when it makes sense to bring in an outside investigator.
4. Plan the investigation. Start by organizing your thoughts and information: What do you know? What do you need to find out to decide what happened? Who might have relevant information? What's the best way to get it? A little careful thought up front can help you avoid wasting time or overlooking important facts as you investigate. Chapter 2 explains how to prepare to investigate, including tips on letting others in the company know your plans.
5. Interview. The heart of any investigation is gathering information -- and the most basic way to do that is by asking people questions. Typically, you'll have to interview the employee accused of wrongdoing, the employee who complained or was the victim, and any witnesses to the incident(s). You'll learn the most by asking open-ended questions that encourage disclosure without giving too much away. Chapter 3 explains how to conduct successful interviews, including whom to interview, what to ask, and how to get the facts you need.
6. Gather documents and other evidence. Documents play a role in many investigations -- and decide the outcome in more than a few. You might have to review personnel files, email messages, personal notes, performance reviews, and other documents to figure out what really happened. You might also have to gather physical evidence, such as a weapon, photographs, or clothing. You'll find information on gathering evidence, including a document checklist, in Chapter 3.
7. Evaluate the evidence. The most challenging part of the investigation -- especially if witnesses disagree or contradict each other -- is figuring out what actually happened. There are some proven methods of figuring out where the truth lies, methods all of us use in our everyday lives. Chapter 4 explains how to sift through the evidence and come to a conclusion -- and what to do if, despite your efforts, you can't get to the bottom of things.
8. Take action. If you conclude that an employee committed serious misconduct, you'll have to act quickly to avoid legal liability for that employee's behavior and to protect other employees from harm. Chapter 4 explains how to decide which actions to take after the investigation, including how to communicate with the employees involved.
9. Document the investigation. Once your investigation is complete, you should write an investigation report that explains what you did and why. This will not only give the company some protection from lawsuits relating to the investigation, but also provide a written record in case of future misconduct by the same employee. Investigation reports are covered in Chapter 4.
10. Follow up. Your last step is to make sure the problem that led to the investigation has been solved. You'll need to follow through with the complaining employee and the accused employee, and you might have to take other steps -- such as training employees or developing new workplace policies -- to deal with systemic workplace problems. Chapter 4 explains how to follow up after the investigation.

Forms, checklists, and more. You'll find all of the forms, checklists, and other tools described in the book in Appendix B and on the CD-ROM inside the back cover. The CD-ROM also includes audio tracks of investigative interviews.

Common Investigation Mistakes -- and How to Avoid Them

There are a number of legal traps waiting for companies that conduct an improper investigation or fail to investigate at all. Generally, these traps come in the form of lawsuits brought either by an employee who was a victim of inappropriate behavior in the workplace or by an employee who was disciplined or fired after being accused of misconduct. In either situation, a company that performed an incomplete, biased, or late investigation -- or that never investigated at all -- begins the lawsuit in a fairly deep hole. Not only has the company ignored its workers' legal rights, but it has also shown a lack of concern for its workers' well-being -- something that many jurors (most of whom are or were employees themselves, not employers) find offensive.

In addition to these legal issues, companies that don't investigate problems or that conduct half-hearted investigations will face practical problems. These employers are sending precisely the wrong signals to employees, managers, and customers: that they don't want to hear about workplace problems, they don't really care what's going on in their company, and they won't enforce their own workplace rules.

Finally, failing to investigate or doing a poor job will exact an emotional cost as well. Wrongly accusing an employee of serious misconduct not only invites a lawsuit, but also ruins that employee's reputation and relationships with coworkers. As if the legal and practical traps described above aren't bad enough, imagine how bad you'll feel if you make the wrong call -- and your mistake brings unhappiness, anxiety, and possibly even career ruin to a blameless employee.

Fortunately, it isn't too hard to avoid these mistakes. By following the strategies outlined in this book -- and using your common sense -- you can keep your investigation on the right side of the law. Here are some common investigation errors, along with tips that will help you avoid them.

Failing to Investigate

If company management is aware of serious misconduct or dangerous activity in the workplace and doesn't do anything about it, the company could have significant legal exposure. Generally, any harm that comes to a company's employees -- and sometimes, to people who aren't on the payroll, such as customers, clients, or bystanders -- after the company has notice of a problem will be the company's legal responsibility. This means, for example, that an employee who suffers sexual harassment after a manager learned about the problem will be able to sue the company for damages.

Your company might also face a lawsuit if it fires an employee for workplace wrongdoing without first conducting an investigation. If that employee has an employment contract -- whether written, oral, or implied -- limiting the company's right to fire, that employee might sue for breach of contract if you don't investigate before terminating his or her employment. The lawsuit would claim that (1) the employee didn't commit the misconduct for which he or she was fired; (2) your company didn't bother to investigate to figure out what really happened; and, therefore, (3) your company didn't have good cause to fire the employee.

Usually, this won't be an issue because most employees don't have employment contracts. Instead, they are "at-will" employees, which means that they can quit at any time, and you can fire them at any time, for any reason that is not illegal (illegal reasons for firing include discrimination and retaliation). However, some employees have employment contracts that limit the employer's right to fire at will. For example, the contract might state that the employee can be fired only for "good cause" -- a common provision -- or for specified reasons (such as "gross misconduct" or "financial malfeasance"). If you fire the employee for reasons other than those stated in the contract, the employee can sue your company for breaching the contract.

An employee might also have a contract that hasn't been reduced to writing. For example, some employees have spoken agreements with the employer (known as oral contracts). Whatever the employer and employee agreed to orally will govern the employer's right to fire. In other cases, an employee might have an implied contract: a contract that was never explicitly reduced to words, whether written or spoken, but arose from the conduct and statements of the employer and employee. For example, if an employer tells a worker "as long as you do a good job, we'll keep you on," that could be interpreted as an implied contract restricting the employer's right to fire the employee unless the employee performs poorly.

To avoid the legal problems that can result from failing to investigate, take workplace problems seriously. Never ignore complaints of wrongdoing. Even if a situation seems simple or straightforward, always do some initial research before deciding that an investigation isn't warranted. And make sure you know all the facts before taking disciplinary action against an employee.

Delay

Even if you eventually decide to investigate and do a good job, your company can get into legal trouble if you wait too long to get started. If an employee suffers harm -- from harassment or workplace violence, for example -- after you learned about the problem but before you took action, your company will usually be legally responsible to that employee. The longer you postpone the investigation, the more serious this legal liability could be.

Example: Kristen worked as a checker at a grocery store. She complained that a coworker harassed her by calling her names, propositioning her, commenting on her appearance, and touching her. Kristen complained to the store's assistant manager several times; each time, the manager confronted the coworker, who denied the allegations. After Kristen's fourth complaint -- two months after her first complaint -- the accused harasser was transferred to a different shift, where he had no further contact with Kristen.

Kristen filed a lawsuit against the grocery store for sexual harassment. The employer tried to have her case thrown out, arguing that it stopped the harassment by transferring the alleged harasser. However, the court found that the store's two-month delay before taking action was too long, even if it eventually did the right thing by moving the alleged harasser to another shift. The court allowed Kristen's lawsuit to go forward.

Postponing the investigation could also lead the complaining employee to claim that he or she was retaliated against -- disciplined or otherwise treated badly for making the complaint. (For more on this issue, see "Retaliation," below.) If the employee is threatened by the wrongdoer, given the cold shoulder by other employees, or even disciplined by a supervisor for coming forward, that could well constitute illegal retaliation for which your company would be legally liable.

Of course, there's a simple solution: Don't delay your investigation. Once you learn of a serious problem or complaint, get moving right away. If you absolutely have to wait a bit before getting started (because the victim is on vacation, for example), document the reasons for the delay. (Chapter 3 explains how to do this.)

Inconsistency

Some companies get into trouble by acting inconsistently -- that is, by handling similar situations differently. In the employment arena, inconsistent treatment can lead to claims of discrimination. An employee who feels that he or she was treated differently because of a protected characteristic -- an inherent quality, such as race or gender, that cannot legally form the basis for an employment decision -- might bring a discrimination lawsuit.

Federal laws prohibit employers from making workplace decisions based on an employee's or applicant's race, color, national origin, sex, religion, age (if the employee is at least 40 years old), or disability. These laws don't apply to smaller employers; only employers with at least 15 employees -- or 20 employees, for age discrimination -- are required to follow them. In addition, almost every state has adopted an antidiscrimination law. Although some of these laws mirror the federal rules, some prohibit additional kinds of discrimination (based on sexual orientation or marital status, for example) and some apply to smaller employers. (For more on discrimination laws and protected characteristics, see Chapter 5. You'll find information on your state's antidiscrimination laws in Appendix D.)

If you aren't even-handed in your investigations, you could risk a discrimination claim. For example, if you decide not to investigate a complaint against a white man for sexual harassment but you do investigate a harassment complaint against an African-American man, you and your company might be accused of race discrimination. Similarly, if you don't investigate a claim of discrimination brought by a Muslim employee, that employee might argue that your decision was based on hostility to his or her religion.

Example: Kwik & Klean, a janitorial company, investigates an incident of sexual harassment. The company concludes that Tom, a white employee on one of the night crews, has been telling X-rated jokes and stories, which have made some of his female coworkers uncomfortable. Tom is given a written warning and is required to attend sexual harassment training.

Several months later, a worker on a different crew complains that Eduardo, a Latino employee, has been making lewd sexual comments to coworkers. The company investigates and concludes that the complaint is valid. The company is concerned that it has had two incidents of harassment in the past few months and decides that it has to take steps to demonstrate its commitment to rooting out the problem, so it decides to fire Eduardo.

Eduardo sues, claiming that he was treated more harshly than Tom because of his race. Even if the company's decision wasn't based on the race of either employee, it will have trouble defending its inconsistency in court. Because the employees committed similar offenses, the best course of action is to impose similar discipline. The company can take other steps -- like requiring sexual harassment training for the entire workforce -- to show employees that harassment won't be tolerated.

Avoid discrimination claims by treating similar problems similarly. If you decide to investigate one claim but not another, make sure you have a valid, business-related reason for doing so. If you punish one employee more harshly than another, be prepared to justify the difference. And always check your motives: Most of us don't want to admit to any prejudice, but we all have preconceptions that can affect our decisions. Inconsistency is sometimes justified, but it can also be a sign of unconscious bias at work.

Retaliation

Your company may not take any negative action against an employee for coming forward with a complaint or participating in an investigation. As the U.S. Supreme Court recently held (in the context of discrimination and harassment complaints), any action that could deter a reasonable worker from coming forward with a complaint might constitute retaliation. ( Burlington Northern & Santa Fe Railway Co. v. White, 126 S. Ct. 2405 (2006).) An employee need not show that he or she was fired or demoted to bring a retaliation claim: Lesser forms of mistreatment might also qualify as retaliation, if they could discourage employees from bringing complaints.

Most conscientious employers realize that punishing an employee for bringing a workplace problem to their attention is a bad idea, for legal and practical reasons. However, even savvy employers sometimes retaliate against an employee without intending do. This comes up most often when employees have to be separated for some reason. For example, if one employee is harassing another, your first instinct might be to move one of the workers to another position, so they won't have to work together. However, if you move the worker who complained, that worker might feel that he or she is being punished for complaining -- especially if the new position, workspace, or shift is less prestigious or desirable.

To protect against retaliation claims, warn everyone involved in an investigation that retaliation won't be tolerated. Ask the complaining employee -- and perhaps his or her manager -- to bring any instances of retaliation to your attention immediately. And if you must separate workers, either move the worker accused of misconduct or make very sure that the worker who complained is in favor of the change you propose.

Retaliation lawsuits can outlive the original complaint. Courts have held that an employee can sue an employer who punishes the employee for making a complaint even if the conduct the employee complains about doesn't violate the law. For example, an employee files a lawsuit, claiming that she was fired for complaining about sexual harassment by a coworker. The court decides that the coworker's conduct, while inappropriate, did not meet the legal standards for sexual harassment. However, the court might still allow the woman to sue for retaliation: Even though she wasn't sexually harassed, it is illegal for the employer to fire her for complaining about it in good faith.

Failing to Be Thorough

Performing an incomplete or sloppy investigation -- by failing to interview key witnesses, neglecting to review important documents, or ignoring issues that come up during the investigation, for example -- can have many of the same negative consequences as failing to investigate at all.

The employee who complained or suffered mistreatment will feel that his or her concerns weren't taken seriously and might sue for retaliation or for harm that continued during and after the investigation. An employee accused of misconduct might believe that your company wasn't interested in his or her side of the story or in finding out what really happened, which could lead to a lawsuit for wrongful termination or discrimination.

And worse, your company won't be able to rely on the results of your investigation in court: If an employee can show that you did an incompetent job, perhaps by hiring an expert witness to testify that you didn't investigate properly, your company will be in an even worse position than if you never investigated in the first place. As great political scandals have shown, the "cover-up" can be more damaging that the underlying problem ever was. If your investigation appears to be inadequate, a jury might well wonder whether you were trying to hide deeper problems or protect someone important at your company, perhaps by making a scapegoat of the employee who was fired.

This is an easy mistake to avoid. Following the simple strategies and steps in this book will ensure that your investigation is thorough and proper -- and will stand up in court.

Compromising Confidentiality

Loose lips do more than sink ships -- they can also torpedo a workplace investigation. From a practical standpoint, talking too much during the investigation -- telling a witness what another witness said, revealing your personal opinion to one of the employees involved, or publicizing the complaint in the workplace, for example -- can lead others to doubt your objectivity. They might believe you have already made up your mind and therefore aren't going to investigate fairly. Employees involved in the investigation might change their statements, either subconsciously or intentionally, based on what you say. And you can bet that if you're talking about the investigation, the entire workplace is talking, too, which will lead to a lot of gossip and lost productivity.

As a legal matter, an employee who believes you have maligned his or her reputation by spreading false information can sue for defamation. These claims are sometimes made by the target of the investigation, who argues that the employer falsely accused him or her of wrongdoing, resulting in unfair discipline and a damaged reputation -- and perhaps even preventing him or her from getting another job.

Example: Tricia was fired from the Reader's Hideaway, a bookstore, after her register drawer was short on several occasions. Tricia claims that she didn't steal any money from the store, and that another employee -- David, the owner's son -- used her register on each day that it was short. David denies taking the money, and the company never talks to other employees about what they've seen or looks into Tricia's claims further. When Tricia applies for other jobs and Reader's Hideaway is called for a reference, the owner says that Tricia was fired for stealing from the company. Tricia sues for defamation.

A defamation claim can also be brought by an employee who makes a workplace complaint, if you conclude that the complaint is false and make this belief public. In this situation, the employee's claim is that he or she was falsely labeled a liar. Even a witness who participated in a workplace investigation could accuse the employer of lying about what he or she said, if the employer's statements damaged the employee's reputation.

Defamation claims start when investigators or employers talk too much, or say things that they don't know to be true. The best way to avoid this mistake is to reveal information on a need-to-know basis only. Don't talk about the investigation, the evidence, or your conclusions with anyone except those who need to be in on the decisions. If you must make a damaging statement about an employee or former employee, stick to the facts and keep it short.

Losing Objectivity

You've probably developed some personal opinions about most of the people you work with. It's human nature to like some people more than others. But you have to put these opinions aside and look objectively at the evidence when you conduct a workplace investigation. If you let your personal feelings and opinions hold sway, you might be accused of discrimination -- and the results of your investigation could be called into question.

It can also be tough to stay objective if you have to investigate -- and recommend discipline against -- people who outrank you on the corporate ladder. But, if you let the offending employee's position in the company dictate the outcome of the investigation, you aren't doing your job properly.

The best antidote for this problem is to remember your role. When you investigate, you are acting on behalf of the company. If you feel unable to put your personal feelings aside, get some help. Ask someone else within the workplace (or hire an outside investigator) to conduct the investigation or get some advice from a lawyer.

You might not like what you discover. You must follow the evidence wherever it leads, even if that means uncovering serious problems at your company or finding that a popular or high-ranking employee committed wrongdoing. You won't do your company any favors by turning a blind eye to these types of problems: Remember, your job is to figure out what's going on, so the company can take effective action to remedy the situation. Although your findings might make you unpopular or unhappy in the short term, you'll be doing the right thing in the long run.

Strong-Arm Interview Tactics

Some investigators are so intent on getting straight answers from the workers they interview that they restrain workers against their will. For example, an investigator might lock the door to the interview room, physically prevent the employee from leaving, or tell the employee something like "nobody's leaving this room until I find out what really happened." Using physical means to restrain an employee, or taking actions that lead the employee to believe that he or she is not free to go, can lead to a legal claim of false imprisonment.

You can avoid false imprisonment lawsuits by avoiding coercive tactics. If an employee indicates that he or she wants to leave the room or stop an interview, let him or her go. Your company is free to take disciplinary action against an employee who refuses to answer legitimate questions or participate in a workplace investigation. However, you can't use physical means or threats to prevent the employee from leaving.

Invading Employee Privacy

Don't become so zealous in your search for the truth that you invade employees' privacy rights. This can be a tough call; after all, conducting an investigation involves a certain amount of poking around, usually into things that someone doesn't want you to know about. However, if you cross the line from legitimate workplace concerns into private employee property or behavior, you could be inviting a lawsuit for invasion of privacy.

If an employee files a lawsuit for invasion of privacy, a judge will look at why both sides acted as they did: why the employee expected privacy and why the employer searched, monitored, or otherwise got into an area the employee felt was private. Then, the judge decides whose side of the argument seems most reasonable, in what is aptly called a "balancing test."

Searches

When investigating certain types of wrongdoing, you may need to search an employee's work area. For example, if an employee is accused of theft, you may want to look in the employee's desk or locker for the stolen items. You will be on safest legal ground if your company has a policy that reserves the right to search employee workspaces -- this type of policy shows that employees should not have expected the contents of their desks or lockers to be private.

The more intrusive the search, the more compelling your reasons for searching must be. For example, if you want to search something an employee brings on company property, such as a lunch pail or backpack, you must have a fairly strong reason to search. And you probably should not undertake this kind of search unless your company has clearly warned employees, in a written policy, that these items are subject to search. If you want to conduct a really intrusive search -- for example, turning out a worker's pockets or searching an employee physically -- you are asking for trouble. If your investigation reaches a point where this type of search seems necessary, talk to a lawyer. (For more on workplace searches, see Chapter 7.)

Electronic Monitoring

As long as your company has a written policy letting workers know that it might monitor their email or use of the Internet, the company generally has the right to read employee email sent on company equipment or monitor which websites employees visit using the company's computer network. During an investigation, email messages often provide crucial proof of misconduct, such as harassment, discrimination, or threats.

Example: Isaac complains that someone is sending him racist cartoons and jokes anonymously, using the office email system. The company has a written policy permitting email monitoring. The investigator reads the email messages and asks for the tech department's help in figuring out where they originated. The employee who sent the offensive messages would have a hard time arguing that the company shouldn't have read the messages or traced them back to their sender.

Monitoring phone calls is another story. An employer is legally allowed to monitor employee conversations with customers or clients for quality control (although some state laws require the employer to inform the parties to the call -- either by announcement or by signal -- that someone is listening in). However, different rules apply to personal calls. Once the person monitoring realizes that a particular call is personal, the monitoring must stop immediately.

Avoiding Privacy Lawsuits

The best way to avoid violating employee's privacy rights is to ask -- or search for -- only what you need to know. Exercise restraint: Don't search or monitor employees without a good reason. The further you stray from the complaint or alleged misconduct, the more likely you are to invade someone's privacy.

You can minimize legal exposure by making sure your company adopts written policies warning employees that it reserves the right to search desks, lockers, and email. If your company has a written policy warning that it might search, employees will have a tough time arguing that they reasonably expected those areas to be private.

Using Polygraphs Improperly

You might believe that the easiest way to get to the bottom of a workplace problem is to require everyone involved to take a lie detector test. In many situations, however, polygraph tests will only lead to trouble. A federal law, the Employee Polygraph Protection Act (29 U.S.C. §§ 2001-2009) strictly limits the circumstances in which an employer can require workers to take a lie detector or polygraph test, and it's not easy to meet the law's requirements.

An employer has to fit within one of the law's narrow exceptions to have the legal right to test. (One of the exceptions applies to theft investigations; see Chapter 7 for more information.) And even then, the employer has to meet a long list of technical requirements before it can use the results of the test to make a disciplinary decision about an employee. For example, the employee must receive a variety of written notices, must receive the test questions in advance, cannot be asked certain types of questions, and must receive a copy of the test results, among other things. In addition, the employer may only use a polygraph examiner who meets certain qualifications and reports the results of the test in a particular form.

It can be pretty tough to conduct a legal polygraph test under this law. Even if your company can meet the legal requirements, you'll have to decide how much weight to give the test results. Experts disagree about how easy (or difficult) it is to "beat" the test. Because of these legal and practical problems, most employers should probably just skip the polygraph testing altogether. If you are still inclined to test, make sure the situation falls within one of the law's exceptions -- and hire a polygraph examiner who is properly certified and understands the law.