A recent ruling from the Alberta Court of King's Bench examined an alleged workplace harassment complaint filed against an employee. After receiving the complaint, the employer initiated an internal investigation as required by their “Respectful Workplace Policy”, retained legal counsel, and tasked an external investigator (who was not a lawyer) with conducting the investigation. While the investigation was occurring, a second complainant made allegations of harassment against the employee, which was also investigated. As a result of the investigation, the employee’s employment was terminated with cause.

The employee initiated a wrongful dismissal action and sought disclosure of the information and records obtained in the investigation, including records relating to both complainants’ interviews, the second complainant’s identity, particulars of the allegations, and the employee’s own interview. The employer refused to disclose those records, claiming that they were privileged, by either litigation privilege or solicitor-client privilege.

What the Court Said

The employer bears the onus to prove its privilege claims. The Court explained that litigation and solicitor-client privilege were distinct from each other and served different purposes, and went on to discuss the differences between them. The Court reviewed applicable case law relating to privilege in the context of workplace investigations, key principles of which are as follows:

• In order for information to be captured by litigation privilege, it must have been created for the dominant purpose of being used in contemplated or pending litigation (this is known as the “dominant purpose test”). The Court looks at the purpose behind the creation or preparation of documents, not the reason the documents were obtained.
• In order for information to fall under solicitor-client privilege, communication must be between a solicitor and client, given in the context of seeking or giving legal advice, and intended by the parties to be confidential. Some communication between solicitor and client is not privileged, particularly if the lawyer is conducting factual investigation or providing non-legal advice.
• Solicitor-client privilege can apply to third-party communications and records where the third party serves as a channel of communication between the client and solicitor, enabling the solicitor to provide the client with legal advice. In other words, third party information would be captured by this type of privilege so long as it is essential for the operation of the existing solicitor-client privilege.

In applying those principles, the Court found that in this case, the third-party investigation was not privileged as it was also conducted for operational purposes pursuant to the Respectful Workplace Policy. The Policy did not mention investigations being subject to privilege, but instead provided that the investigation may be disclosed as required by law.

There was no suggestion in the evidence submitted by the employer that the records in question were created for the dominant purpose of litigation, or for obtaining legal advice. In any event, even if the records were privileged, that privilege had been waived as the employer had, in its pleadings, disclosed and relied on the information at issue to defend its actions. Although the investigation report was not at issue in this case, the Court commented that it was most likely privileged, as it had been created for the purpose of obtaining legal advice.

The Court held that it was reasonable for the employee to be able to have access to the case against them in the event they wished to challenge their termination, and ordered the employer to disclose the name of the second complainant and their allegations, as well as copies of the investigation materials (not the investigation report).

Takeaways

When relying on investigation materials to assert cause, an employer should turn its mind to the issues of privilege early in the process. An employer should not necessarily expect an “absolute assurance of confidentiality” when it comes to workplace investigations, especially when conducting investigations in compliance with internal operational policies.

This does not mean that investigation materials can never be subject to privilege. The Court’s conclusion on solicitor-client privilege might have been different had the third party possessed special expertise needed for the lawyer to be able to provide advice, or that the lawyer needed that third party to be able to interpret or acquire relevant client information directly. The Court will review the circumstances of the creation of the third-party records, such as investigation materials, and assess the privilege claim over them accordingly. Nevertheless, where there may be a legitimate claim to privilege, an employer must be cautious in how it uses the information or documentation to avoid waiving the privilege.

Workplace investigations are often necessary to ensure a respectful and compliant work environment. These investigations can involve complex legal issues, including privilege concerns, and can be difficult to navigate effectively. Contact Francesca Ghossein in Edmonton, Steve Eichler in Calgary, or any member of our Workplace Investigations team for tailored advice and support on managing workplace investigations and safeguarding your organization against potential legal risks.

Link to decision: Prosser v Industrial Alliance Insurance, 2024 ABKB 87

Special thanks to Emilie Allen, Field Law Summer Student, for assistance authoring this article.