When a California employer hires an outside attorney to conduct a workplace investigation, California Business and Professions Code section 7522(e) mandates that the attorney act as “an attorney at law in performing his or her duties as an attorney at law.” California attorney-investigators initially establish their role as an attorney for the organization through limited scope engagement agreements. The engagement agreement limits the engagement to conducting an impartial workplace investigation and providing advice only on narrow issues surrounding the investigation itself.
After engagement, the investigator’s communications with the client are protected by the attorney-client privilege. Unlike an attorney who is engaged to provide a broad scope of legal services, such as the organization’s employment litigation counsel, there is a possibility the client will waive the privilege with the attorney-investigator. This occurs most frequently when an organization waives the privilege over an investigation in subsequent litigation or an administrative proceeding. As a result, attorney-investigators must carefully control who they talk to about the investigation and what they share.
An attorney-investigator’s conversations with an organization’s executive are protected by the attorney-client privilege. However, the investigator should remind the executive of the potential future waver and avoid discussing matters that should only be shared with litigation counsel. Discussions about the organization’s legal exposure, for example, are not only outside the scope of the attorney-investigator’s retention, but could be disclosed at the time of litigation if the organization waived the investigator’s privilege.
Organizations that retain attorneys are wise to identify specific individuals authorized to have privileged conversations with the attorney. Likewise, attorney-investigators should advise the organization to identify one or two employees, who are not parties to the investigation, with whom the investigator can discuss technical or procedural issues relating to the investigation.
On the flip side, an attorney-investigator must inform all other individuals during an investigation that she represents the organization and not the employee, regardless of the employee’s role in the organization. If an employee reasonably believes his statements made during an investigative interview are privileged, the investigator may be precluded from relying on them in making investigation findings. Most attorney-investigators have a standard introduction they use in all interviews describing their role as the attorney for the organization and alerting the witness to the fact that there is no privilege between them.
Organizations and attorney-investigators also need to be cautious about the role of outside counsel during an investigation. Over-involvement might later extend the waiver to communications between outside counsel and the attorney-investigator. In one case, an organization relied on an investigation conducted by an external attorney-investigator as a defense in litigation, and waived the attorney-client privilege. The court found that the organization’s regular outside counsel was so closely involved in managing the investigation as to be “intimately connected to” if not “controlling” the investigation and ruled that the waiver of the privilege extended to outside counsel’s files relating to the investigation. Koss v. Palmer Water Dept., 977 F.Supp. 2d 28 (D. Mass. 2013)
The case is not binding in California, but provides a note of caution to organizations and investigators – pay close attention to the role of other attorneys and the risk that a waiver down the line might be broader than expected.