Employment Investigations: When Should We Hire an Outside Investigator?

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Christy K. Monson

From our Spring 2015 e-newsletter

Most employers understand that they have a duty to promptly and fairly investigate employee complaints, especially where discrimination, harassment or retaliation is alleged. However, even sophisticated employers may not have given much thought to when they should hire an outside investigator as compared to handling the investigation themselves. The purpose of this article is to provide you with some factors to consider when deciding whether to use an outside investigator or whether to handle the investigation in house.

Should Our HR Staff Handle this Issue? If you are lucky enough to have an HR staff, you should weigh whether they can or should investigate the particular matter. Many times, if not most, a properly trained HR staff can handle workplace investigations. To determine if your HR staff should handle an investigation, ask yourself the following questions:

  • Do they have experience doing internal investigations?
  • Do they have at least some experience handling the particular type of matter being investigated?
  • Have you provided them with access to your legal counsel so they can get good advice regarding the investigation?
  • Have they been trained in investigation techniques and process?
  • What is their present workload?
  • Does the particular situation require specialized knowledge of certain employment laws or other laws?
  • Does your HR staff have the necessary personal characteristics to neutrally and dispassionately investigate?
  • Does your HR staff have any conflicts of interest or bias regarding this particular situation?
  • Does the particular situation place your HR staff in the awkward position of investigating a superior?
  • Is there any other reason to believe that your existing HR staff may be biased or unable to fairly investigate the matter?
  • Are Other State or Federal Agencies Involved?

Another factor employers should consider is whether other levels of government are involved in the particular matter. For example, some employment complaints also involve federal or state government agencies such as the Equal Employment Opportunities Commission, the Department of Labor, Oregon’s Bureau of Labor and Industry, or Ethics Commission. If other government agencies are involved, you may want to consider using an outside investigator with experience handling similar allegations and a working knowledge of the agencies’ processes. It’s often beneficial if such investigators are also employment lawyers.

Is Litigation Likely to Occur? Is there already a tort claim notice filed or a lawsuit in progress regarding the matter? If there is, you should consult with the attorney handling the lawsuit and with your insurance counsel to determine the best way to proceed. Often insurance counsel or an outside attorney will recommend another outside investigator to alleviate the risk of a retaliation lawsuit. If complaining employees have already hired a lawyer, you may also want to consider using an outside attorney/investigator. (When selecting outside attorney/investigators, keep in mind that an investigator may be called to serve as a witness at a trial, so should not be closely involved in your employment decisions.)

What types of complaints have been made? If more than one employee complains about the same serious problem or about systematic institutional problems, you may want to consider an outside investigator. However, it is important to evaluate the nature of the complaints. Are the employees merely complaining about a particular staff member’s work habits or supervisory skills or about illegal discrimination or retaliation? Are they complaining about ingrained institutionalized problems (such as racism or sexism) throughout all levels of your government? If the complaints are merely about an individual’s work habits or office communication breakdowns, the situation may be better handled by your HR staff. If they pertain to individual acts of discrimination, longstanding institutional discrimination, or other serious matters, an outside investigator may be warranted.

Who Is Alleged to Have Committed Misconduct? Governments often hire an outside investigator if the allegations are against a high-ranking employee or public official. In such circumstances it can be difficult for in-house HR staff to conduct the investigations due to political pressure, increased media attention, or anxiety about keeping one’s job. Hiring an outside investigator in such situations is also evidence that your government is making a good faith, unbiased effort to determine the facts.

What Type of Misconduct is Alleged? If the allegations are extreme, your government may want to use an outside investigator. Allegations of rape, assault, threats on an employee’s life or theft often require outside investigations because it can be difficult for in-house HR staff to remain impartial in such situations. A good rule of thumb is that any time the allegations require a heightened need for objectivity, neutrality or impartiality, it is wise to consider an outside investigator.

Lastly, if you’ve decided to work with an outside investigator, you should also consider the following:

  1. Outside investigator prices vary greatly depending on their background and the demand for the investigator. Meet with potential investigators and ask them about their rates, background and experiences with this particular type of investigation. Ask for references from other employers and about their interview techniques, approximate time estimates, availability, and length and level of detail in their reports. Ask to view a sample report. Consider whether the investigator would be a good witness at a trial.
  2. Do you want the outside investigator’s work and report to remain confidential? If so, you must discuss this with the investigator prior to commencing work and you must include your City Attorney in this discussion.
  3. Be absolutely clear with your investigator regarding the limited scope of the investigation. You should also provide clear directions about what the investigator should do if he/she discovers new violations.

If you would like more information about employment investigations, please feel free to call our offices.

Conducting a 360-Degree Review for Local Government Upper-Level Managers/Supervisors

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Diana Moffat

From our Fall 2015 e-newsletter

As we enter a new fiscal year, have you given thought to conducting a performance evaluation on your upper-level managers, supervisors, department heads?

Getting performance feedback benefits our upper level management staff, just as it benefits our other employees. For upper level management, other than City Managers, County Administrators or Fire Chiefs, a variation of the traditional employee performance evaluation is often recommended. In such instances a 360-degree (multi source) assessment can be employed. A 360-degree evaluation is contrasted with upward feedback, where managers are given feedback only by their direct reports, or a traditional performance appraisal where the employees are most often reviewed only by their managers. Those types of reviews involve the manager receiving feedback from a single perspective.

In contrast, a 360-degree type of assessment provides feedback from members of a manager’s immediate work circle. Most often, 360-degree feedback will include direct feedback from an employee’s subordinates, peers, and supervisors, including the CEO (City Manager, Fire Chief, County Administrator, etc.), members of the City Council/County Commission/Board of Directors, as well as a self-evaluation. It can also include feedback from external sources, such as customers/clients and vendors or other interested stakeholders, such as Chamber of Commerce, inter-agency law enforcement teams, dispatch centers, etc. This type of assessment can better lead to the professional development of the manager. The results from a 360-degree evaluation are often used by the person receiving the feedback to plan and map specific paths in their development as an effective manager. Results are also used in making administrative decisions related to pay and promotions. The use of 360-degree feedback helps to improve employee performance because it helps the evaluated see different perspectives of their performance and management style.

When employing these types of assessments it is often recommended to use an outside consultant. This allows for an objective assessment of the performance and goals, as well as opening a path to frank and open discussions with both the evaluated and the persons providing the input and feedback.

My 360-degree assessments may include the following dimensions:

  1. Customer Focus – involves the delivery of high quality services and a commitment to continuous improvement.
  2. Effective Communication – is the art of sharing information, with the ability to gain understanding, by means of oral or written communication and the use of technical resources for conveying and receiving messages to meet the needs of all.
  3. Job Knowledge and Role Understanding – involves the demonstration of proficiency in technical and job knowledge aspects of the position to achieve a high level of performance, along with the possession of an ability and desire to learn.
  4. Decision Making, Problem Solving and Innovative Thinking – analyzing information is fundamental to making effective work-related decisions so that actions are based on sound understanding of the organization.
  5. Leadership and Teamwork – leadership positively influences people and events; leaders align, define and communicate goals and objectives throughout the organization.
  6. Accountability – is the obligation to deliver specific defined results in a measurable way.
  7. Accomplishments.
  8. Areas of performance that need more attention or improvement.
  9. Goals for the coming year.

During the process the evaluator works with the governing body and the manager/supervisor to define evaluation criteria, including relevant documents such as past reviews, job description, definition of the circle, Council/Commission/Board goals and directives, etc. Once completed, the evaluation results and recommendations are presented to the governing body and the manager/supervisor, coupled with any needed follow-up. From my experience, the interested stakeholders are brought into alignment of assessment and future goals which provides for a great roadmap for the coming year!

Note: This update is informational only and is not intended as legal advice. If you have questions about any of the information in this update, please contact your legal counsel.

Marijuana Issues for Local Governments

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Lauren Sommers

From our Fall 2015 e-newsletter

On July 1st recreational marijuana became legal in Oregon. Folks 21 and over are allowed to grow up to four plants, and to possess 8 ounces of useable marijuana, 16 ounces of solid marijuana products and 72 ounces of liquid marijuana products per household. Those 21 and over can also give (but not sell) up to one ounce of homegrown marijuana, 16 ounces of solid homemade marijuana products and 72 ounces of liquid marijuana products to another person who is at least 21. Marijuana still may not be grown or consumed in public. OLCC will begin accepting applications for recreational marijuana facilities (growers, processors, wholesalers and retailers) in January of 2016, but OLCC does not anticipate issuing recreational marijuana licenses until sometime in the second half of 2016.

Now that recreational marijuana is legal in Oregon there are a few issues for local governments to consider.

CITIES AND DISTRICTS:

Now is a good time to review your drug use and testing policies. Given the changes to the legal landscape surrounding marijuana, it is time to think about what your city or district is willing to allow in the workplace. Measure 91 does not automatically allow marijuana or marijuana use in the workplace, nor does it require employers to allow employees to come to work impaired or with marijuana in their systems. However, it is worth noting that marijuana may remain in a user’s system for a considerable amount of time even though the user is no longer impaired.

We recommend you think about whether your city or district wants to impose a zero-tolerance policy, or simply wants to prohibit employees from working while impaired. Under a zero tolerance policy, an employee could be disciplined or terminated for having marijuana in his or her system, even if the employee was not impaired at work and the marijuana in the employee’s system is the result of lawful off-duty marijuana use.

On the other hand, if a local government’s policy simply prohibits an employee from being impaired at work, an employee could report to work with residual marijuana in his or her system as long as the employee is not impaired while in the workplace. Local governments generally have the freedom to choose a zero-tolerance policy or a no-impairment policy (except that certain employees, such as those employees who hold commercial driving licenses, may have to comply with zero-tolerance under applicable federal regulations).

We encourage you to review your current policies to make sure that they still work for your entity and to make sure you understand how they apply to recreational marijuana. Remember that if you have unionized employees, changes to drug testing policies will likely need to be bargained.

CITIES:

In addition to a review of your drug policies, there are four big marijuana-related issues that cities should be thinking about: 1) recreational marijuana sales by medical marijuana dispensaries; 2) a ban on marijuana facilities in the city; 3) reasonable regulation of marijuana facilities; and 4) a local tax on sales of recreational marijuana.

Dispensaries Selling Recreational Marijuana: On October 1, 2015, medical marijuana dispensaries will be allowed to sell limited amounts of recreational marijuana unless your city council adopts an ordinance prohibiting those sales. If your city council wants to prohibit medical marijuana dispensaries from selling recreational marijuana, the council should adopt an ordinance prohibiting those sales soon so that the ordinance takes effect before October 1, 2015. If your city council wishes to allow recreational sales by medical marijuana dispensaries, the council does not need to take any action.

Marijuana Facilities Ban: Cities have the ability to ban any or all of the following types of marijuana facilities (recreational marijuana growers, recreational marijuana processors, recreational marijuana wholesalers, recreational marijuana retailers, medical marijuana processors, and medical marijuana dispensaries). Unless 55% of the voters in the county in which your city is located voted against Measure 91, in order for a ban to take effect it must be approved by the voters at the November 2016 general election. However, as soon as your city council adopts an ordinance banning the marijuana facilities, OLCC and OHA will stop issuing licenses for facilities in your city until after the November 2016 election. So even though the actual ban will not take effect unless and until approved by the voters, adoption of the ordinance by the Council creates an effective moratorium between now and then. Pre-existing marijuana facilities are allowed to continue operating – even if the voters approve the ban.

NOTE: if your city bans any category of marijuana facility, the city will not receive any state shared marijuana revenues and will not be able to adopt a local tax.

Reasonable Regulations: If your city council is interested in regulating recreational grows, recreational processors, medical processors, recreational wholesalers, recreational retailers or medical marijuana dispensaries now is the time to start thinking about those regulations. As you know, it takes a while to adopt a land use ordinance, and OLCC will begin accepting license applications for new marijuana facilities in January. As part of the licensing process, OLCC will ask for Land Use Compatibility Statements from cities in which marijuana facilities propose to locate. If the your city wants to regulate the places marijuana facilities can locate, you will want to have your Code updated by the end of this calendar year or very early next year. This means you should start to talk about those regulations sooner rather than later.

Local Tax: Cities can adopt a local tax of up to 3% on sales by recreational retail facilities. The local tax will not take effect unless and until it is approved by the voters at the November 2016 general election. The local tax is in addition to any state-shared marijuana revenues received by the city. If a city bans all or any category of marijuana facilities that city may not impose a local tax.

We encourage you to talk to your attorney if you have questions or would like to take action on any of the issues discussed in this article.

Note: This update is informational only and is not intended as legal advice. If you have questions about any of the information in this update, please contact your legal counsel.

So You Wanna Piggyback?

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Carolyn H. Connelly

From our Fall 2015 e-newsletter

More and more clients are asking about “piggybacking” onto a prior contract for the purchase of some item without going through a formal solicitation process. This authority was clearly granted by the legislature in 2005, with the adoption of joint, permissive and interstate cooperative procurement statutes (ORS 279A.210, 279A.215, and 279A.220, respectively).

While it is true that cooperative procurements can save your local government time and money by avoiding a formal solicitation process, they are not as easy as some vendors might lead you to believe. Rather, each type of cooperative procurement has its own discrete set of requirements. If not met, a cooperative procurement is not legal.

Joint Procurements are the least common, as they require coordination between interested purchasing entities at the outset. In addition to other requirements, the original solicitation and contract must identify the procurement group and/or each participating purchasing contracting agency. Further, it must specify all estimated contract requirements.

In contrast, permissive and interstate cooperative procurements can be used after the original solicitation is issued and the original contract is executed. However, certain technical requirements still must be met under either approach.

Permissive Cooperative Procurement (PCPs) are allowed only if:

  1. The original solicitation and award process was substantially equivalent to a formal procurement conducted under ORS 279B. (i.e. either a formal, published Invitation to Bid or an RFP).
  2. Both the original solicitation and contract must allow other contracting agencies to establish contracts or price agreements under the terms, conditions and prices of the original contract.
  3. The vendor must also agree to extend those terms, conditions and prices to the second purchaser.
  4. “No material changes” are allowed between the terms, conditions and prices of the original contract and those in the tag-on contract. The fewer changes made from the original contract, the more likely your entity will meet this undefined standard of “no material change.” As this standard has yet to be interpreted by any court, it is difficult to know how narrowly or broadly to apply this limitation.
  5. If the tag-on purchase is over $250,000, an advertisement of the intended contract must be published. (See, below).

Interstate Cooperative Procurements (ICPs) require the same elements as 1-3, above. Further, your entity must either: a) be listed in the solicitation of the original agency as a party allowed to piggy back and the original solicitation must have been advertised in Oregon; or b) advertise notice of its intent to establish an ICP.

The notice for both PCPs and ICPs must describe the procurement, its estimated amount and the name of the original contracting agency. It must also provide a time, place and date by which comments may be submitted to your entity regarding the intended contract. Publish notice at least once in at least one newspaper of general circulation in the area where the contract is to be performed, at least seven days prior to the deadline for submission of comments. Additional publication is allowed, but not required. Lastly, notice must also be provided to vendors who otherwise might be interested in responding to your entity’s RFP or Invitation to Bid, if one were issued.

While these requirements are not terribly onerous, it is surprising how few original solicitations and contracts include the required “magic language.” A number of intergovernmental agencies and purchasing cooperatives aim to solve this problem. Their members may piggyback upon various listed contracts which are “guaranteed” to meet all state cooperative procurement requirements. However, always double check that all of Oregon’s statutory requirements have been met before entering into a contract with any particular vendor.

In conclusion, for those of you going out for formal solicitations, especially for large purchases, consider whether you want the resulting contract terms to be available to other entities. If so, be sure to specifically permit piggybacking within the terms of your solicitation and resulting contract. For those of you assured by a vendor that your entity can simply buy its product by piggybacking onto a prior contract, be sure to check with legal counsel before plunging ahead. Lastly, even if all cooperative procurement requirements are met, be sure to carefully review the contract prior to signing on the dotted line. No interstate contract will include all ORS 279B required provisions. Further, the vendor’s terms rarely provide sufficient or appropriate protections to the buyer. Make sure the “back” you’re jumping on is solid enough to catch you!

Note: This update is informational only and is not intended as legal advice. If you have questions about any of the information in this update, please contact your legal counsel.