Posted on September 13, 2024 by Jennifer Coburn 9

Internal Agency Investigations: Some Basic Legal Principles

Introduction

This article discusses some principles relevant to internal investigations carried out by NSW Government agencies, or by local government authorities where the investigation is conducted outside the Model Code of Conduct framework.  We won’t cover employment or industrial law aspects here but please keep an eye out for future posts on those exciting topics!

As our readers probably know, most public sector agencies will need to carry out internal investigations from time to time, usually into matters involving the conduct of an employee. They may be wide-ranging investigations into the most serious allegations that could involve criminal conduct, or they may be narrow and confined largely to allegations of policy breaches. In either case, those involved in the investigation should be aware of the legislative framework in which they are operating and the source and limits of any statutory powers they may be exercising (such as the Workplace Surveillance Act 2005 or the Government Sector Employment (General) Rules 2014 (the GSE Rules)).

Key principles

Larger agencies may have an internal special investigations or anti-corruption team who carry out this work, but whether or not the work is done in-house, there are some basic principles of procedural fairness that apply to all internal investigations:

1. The bias rule – investigators and decision makers must be free from real or apprehended bias. This does not mean that there has to be a total disconnection between an investigator or decision maker and a respondent (often difficult if both are employed within the same organisation) but rather that they should not be immediate colleagues or have a close relationship (see a helpful discussion of this in the Independent Commission Against Corruption Factfinder: A guide to conducting internal investigations, April 2022). This is one reason why an internal investigations team can be so valuable to an agency, usually being removed from these relationships by way of the organisational structure.

2. The hearing rule – this is arguably the primary consideration and involves the right to a fair hearing with a reasonable opportunity to respond to allegations. A respondent is informed of the allegations and evidence against them, given an opportunity to review and challenge information being relied upon and the opportunity to respond before a final report is made that could impact the person’s interests.

3. The evidence rule – any decision made following an investigation must be based on evidence not speculation. The rules of evidence won’t generally apply during an internal investigation but most investigators will keep the basic principles of evidence in mind, with a view to both fairness to a respondent and the admissibility of evidence/reliability of reports in any later legal proceedings. This includes things like admissibility, direct or circumstantial evidence (noting here that as most agencies would be well aware, the key case of Briginshaw v Briginshaw (1938) 60 CLR 336 is authority for the principle that the more serious the allegation, the stronger the evidence must be), relevance and hearsay.

An agency may also have processes or policies in place about investigations, dealing with matters such as granting a respondent time away from work to respond to allegations, supporting a respondent and witnesses, and the discretion to interview or not. It will be important to adhere to these processes and policies, as well as the rules discussed above, to minimise the risk of challenges to findings, overturning of findings by a court or criticism of the agency (for example in unfair dismissal proceedings).

Some common issues that arise 

Two common issues that public sector agencies often have to consider are firstly, whether and when to give notice to a respondent of an investigation and secondly, whether draft investigation reports and witness statements must be disclosed to a respondent.

In relation to investigations into misconduct (and relevantly to our NSW Government readers) Rule 38 of the GSE Rules provides for the giving of notice to an employee where the matter will proceed. Practically, it is difficult to conduct an investigation, especially a serious one, beyond more than its initial stages without the respondent at least becoming aware that an investigatory process in underway. In addition, the requirement to give a respondent a reasonable opportunity to respond cannot be complied with, without a respondent also being given notice that an investigation into allegations against them/their conduct is underway. In smaller or less serious investigations, it may be possible to make inquiries and continue an investigation to a further stage without a respondent being aware those steps were taken, especially if it is likely that the matter will not proceed further.

In relation to misconduct, Rule 38(3)(a) GSE Rules provides that a respondent is to be advised “of the details of the allegation of misconduct”. When working out what “details of the allegation” might mean and how to give a respondent the opportunity to respond, recent case law has helpfully clarified that “In most cases…it would be expected that a reasonable opportunity to respond to that evidentiary material will be afforded by proffering a reasonable opportunity to respond to the substance or gravamen of that material, which will usually involve a full account of its essential content” (AB( a pseudonym) v Independent Broad Based Anti-Corruption Commission [2024] HCA 10).

Some agencies may already adopt the practice of providing draft reports to a respondent (say with confidential information redacted), but usually the hearing rule will be satisfied by giving a respondent a reasonable opportunity to respond to the “substance or gravamen” of the evidentiary material. Giving details of allegations and of the “substance or gravamen” of evidentiary material is often done by an investigations team, or perhaps a representative from the agency’s People and Culture team, when informing a respondent about the allegations that have been made against them and their options for responding to those.

A good approach for agencies would be to build procedural fairness into their investigations processes and focus on evidence gathering and the rules of evidence when conducting an internal investigation.

Please leave a comment or contact Jennifer Coburn on 8235 9712 if you would like further information about anything in this article.