Northern Exposure

Investigations by lawyers: Privileged, or not privileged, that is the question

by Monique Orieux

In Canada, an employer may retain a lawyer to conduct a workplace investigation, particularly where the issue under investigation is of a sensitive nature. One reason for doing so is to attempt to keep the investigator’s notes, supporting documents, and final report from being disclosed to a third party as privileged. However, privilege is not a guarantee.

In two preliminary arbitration decisions from last year—one from Ontario and one from British Columbia—employers were ordered to disclose the investigating lawyer’s report and supporting documents to the union. These decisions illustrate the importance of taking care to preserve solicitor-client and/or litigation privilege at the time a lawyer-investigator is retained, during the investigation process, and thereafter.

Durham Regional Police Association v. Durham Regional Police Services Board (Durham): In Durham, the arbitrator ordered the Durham Regional Police Services Board to disclose an investigation report prepared by a lawyer, as well as the documents obtained and drafted by the lawyer during the investigation, to the Durham Regional Police Association (the local police union) in grievance proceedings.

The Board retained the lawyer, with the participation of the Association, to investigate two civilian members’ harassment allegations. The lawyer’s mandate was to conduct an independent investigation and the retainer letter did not suggest that the lawyer was to assess the Board’s liability or provide legal advice. Given that there was “so little evidence” that the report was prepared for the purpose of providing legal advice, the arbitrator concluded that solicitor-client privilege did not apply to the lawyer’s report and related documents.

The arbitrator also dismissed the Board’s argument that litigation privilege applied. A document will be subject to litigation privilege if its dominant purpose is litigation. However, here, the evidence suggested the dominant purpose was to investigate complaints of harassment as required by statute and a workplace policy. Further, the investigation was initiated when litigation was a mere possibility. The fact that a grievance was filed after the fact does not make the report retroactively privileged.

Greater Vancouver Regional District v. Greater Vancouver Regional District Employees’ Union (GVRD): In GVRD, the employer retained a lawyer to conduct an investigation into a complaint of workplace bullying and harassment against an employee making a grievance. The employer and lawyer agreed to terms of reference regarding the investigation requiring that the lawyer inform all persons interviewed that information supplied or disclosed to the investigator would be kept confidential; all correspondence between the lawyer and employer was to be kept privileged and confidential; and the lawyer would prepare a privileged and confidential report setting out the lawyer’s legal opinion, which would be provided to the employer for the purpose of providing legal advice.

After reviewing the terms of reference and a will-say statement from the manager, the arbitrator found that the lawyer was acting as more than simply an investigator; he was conducting an investigation for the purpose of providing legal advice. Consequently, the report and documents related to the investigation, including the lawyer’s interviews with bargaining unit employees, were prima facie privileged. Solicitor-client privilege cannot be “limited or abrogated because of the labour relations context in which it arises.”

However, despite the finding of privilege, the arbitrator found that the employer waived privilege and ordered the production of the report and related documents to the union. Where solicitor-client privilege exists, the client is the only party that can waive privilege. Waiver requires that the client: (1) know that privilege exists; and (2) voluntarily exhibits an intention to waive privilege. Here, both factors were met. The employer was very well aware that privilege existed. However, the employer implicitly waived privilege when it explicitly referenced and relied upon the lawyer’s factual findings and conclusions in the discipline letter to the employee making the grievance.

Lessons for employers

Before initiating a workplace investigation, Canadian employers and their counsel should carefully consider the dominant purpose of the investigation and if the intention is to assert privilege. If done correctly, an investigation conducted by a lawyer can be protected from disclosure to a third party by solicitor-client privilege. This is in contrast to an investigation conducted by a non-lawyer, which doesn’t typically attract solicitor-client privilege.

Employers should also note that solicitor-client privilege can be waived. If privilege is asserted, an employer should not explicitly reference the content of the investigator’s report when giving reasons or an explanation for the discipline. If uncertainty arises regarding what use may be made of the report, consult counsel.