A Fact Investigation Conducted by Outside Counsel in response to an Employee’s claim of Harassment and Discrimination is Privileged

Author: Wendy Hillger

The California Court of Appeal recently held that outside counsel’s fact investigation of an employee’s harassment and discrimination claims conducted prior to litigation was protected by the attorney-client privilege and work product doctrine.

It has long been California law that when there is a claim of discrimination, harassment or retaliation, the employer must inves­tigate.  This investigation must be thorough, objective and complete.  To help assist with these requirements, some companies have hired outside legal counsel.  This ruling resolves the issue about whether outside legal counsel’s work and communications were privileged.  Companies now should not hesitate to investigate an employee claim with outside counsel.

The Court also ruled that assertion of the “avoidable consequences” defense (the employer took reasonable steps to prevent and correct harassment, but the employee failed to use those measures) in the subsequent lawsuit did not waive the privilege as to a post-employment investigation.

[City of Petaluma v. Superior Court (Andrea Waters), Case No. A145437]

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