Unlicensed workplace investigators acting in breach of the law

A decision by the Private Security Personnel Licensing Authority this month, is likely to significantly restrict who can conduct workplace investigations legally; to (1) those who carry a Private Investigator’s Licence; and (2) to lawyers who hold a current Practising Certificate.

The decision

On 4 June 2020, the Private Security Personnel Licensing Authority (PSPLA) issued a decision in an important decision (Re D, E & C Limited [2020] NZPSLA 007) which addressed the issue of whether persons or companies carrying out workplace investigations for employers into employee conduct are carrying out private investigations and therefore, are required to hold a private investigator licence.

The case involved Ms A, who in July 2019 filed a complaint against C Limited about the way in which Ms E carried out a workplace investigation. Ms A had complained:

1. about the way the investigation was conducted; and
2. that the directors of C Limited who conducted the workplace investigation were required to be certified as private investigators.

The process C Limited followed for conducting an investigation was described as:

• Voluntary participation in an interview, where individuals could have a support person or legal representative present.
• The employer could provide the investigator with relevant evidence and the investigator could request additional information from the employer.
• The respondent and the complainant were provided with the opportunity to review and comment on all the evidence collected by the investigator.
• The complainant and respondent were provided with the opportunity to review and comment on the draft investigation report.
• A final investigation report was provided to the employer setting out the investigator’s opinion on whether the factual allegations had occurred and, if so, whether that conduct amounted to a breach of the employer’s relevant policies.

While a significant profession in some overseas jurisdictions, workplace investigations have traditionally remained the domain of a relatively specialised group in New Zealand. However, that group is growing, with no regulation (prior to this decision) required around who can conduct an investigation, and what training/qualification, experience and capability is required. 

The PSPLA accepted that Parliament may not have specifically had employment investigations in mind when the Private Security Personnel and Private Investigators Act 2010 (the Act) was passed. It noted that that this type of work is “a relatively recent feature in the New Zealand market. However, parliament clearly intended the definition of private investigator to cover all people in the business of carrying out investigations into a person’s character, actions or behaviour. This is an integral part of an employment investigators work.”

The PSPLA concluded that by carrying out the business of employment investigators, employment/workplace investigators including C Limited, came within the definition of a private investigator under the Act.

The PSPLA noted that to meet the training and experience qualifications for a security licence in the class of private investigator, an investigator needs to show that they are a trained and experienced investigator. Therefore, competent and experienced investigators would meet the requirements for a licence.

The directors did not have a licence to conduct private investigator work and did not fall within any of the exemptions. These include individuals who hold a current Practising Certificate and are therefore entitled to practise as a Barrister and Solicitor. Accordingly, the investigators of C Limited were in breach of the Act.

Implications of the decision

The PSPLA’s decision significantly restricts who can carry out employment/workplace investigations in New Zealand legally. Although the PSPLA acknowledged that the breach was unintentional, external HR consultants or workplace investigators who do not hold the requisite licence and are not practising lawyers, will not be able to conduct workplace investigations without being likely to be found to be in breach of the Act. The decision may bring an important quality standard to a growing profession.

For employers who require employment/workplace investigations to be undertaken:

• Employers may continue to conduct their own internal investigations;
• Employment/Workplace investigators who hold a Private Investigator’s licence may continue to conduct external employment/workplace investigations;
• Law firms and individual lawyers with current Practising Certificates may continue to conduct employment/workplace investigations;
• When engaging an investigator, employers should confirm that the investigator holds the appropriate legal requirements. Further, that they are appropriately trained, and capable of performing the required work. Ask about the investigations they have conducted previously to ensure that they have the requisite experience. The AWI-CH certificate in Workplace Investigations is the international standard for best practice in workplace investigations and is a good guide to whether or not an investigator has the requisite expertise to conduct a fair, impartial investigation.

At DTI Lawyers, our Director holds the AWI-CH certificate, and is a member of the Association of Workplace Investigators. Our specialist team of employment lawyers hold current practising certificates and are well trained and experienced in how to conduct fair and impartial external workplace investigations.

You can contact our specialist employment law team on 07 282 0174.