Workplace Employment Investigators Require a Licence or Practicing Certificate

There has been a recent, and significant, clarification of the licensing requirements for employment investigators.

Independent employment investigators are often appointed by employers to assist in the investigation of employee misconduct, particularly where there are allegations of bullying or sexual harassment.

There are a range of options for employers looking for someone to undertake an independent employment investigation, including lawyers and specialist investigation firms.

The recent decision of the Private Security Personnel Licensing Authority D, E & C Limited [2020] NZPSLA007 clarifies that those providing employment investigation services are required to be licensed private investigators, unless they hold an appropriate practicing certificate under another Act (which lawyers do, for example).

It was acknowledged within the decision that there was a “widespread belief within the employment investigation industry that they were not private investigators”. However, this widespread belief has been found to be incorrect.

The decision has significant implications for non-lawyers providing employment investigation services. In particular, if the service providers do not fall within one of the exemptions within the Private Security Personnel and Private Investigators Act 2010 (“the Act”), then they will need to become registered to provide Private Investigation services in accordance with the Act.

The application costs $510 for an individual licence, or $616 for a company licence. In the case of a company, their employees will also require a certificate of approval, at a cost of $170 per employee.

In order to be granted a licence, the individual or company must provide proof of their training or skills, and make a number of declarations relating to dishonesty, violence and drugs history.   

The rationale for the capturing of employment investigators within the scope of the Act and the associated licensing regime, is “to ensure that those offering private security services are suitably qualified to carry out the work and do not behave in ways that are contrary to the public interest”. Licensing under the Act also means that there is a clear pathway for complaints, should issues arise relating to the conduct of the investigator.

What does this mean?

This is important both for employment investigators, who will need to consider how best to now address the requirement to be licensed, and for employers looking to appoint an independent investigator.

Employers should be seeking clarification from investigators as to their licensing (or exemption) status.

If an employer engages an investigator who is not licensed or does not hold a practicing certificate, it is now likely that employee will argue that the investigation was flawed and that the report cannot be relied upon. This argument holds some merit in light of the above decision. Further, employment lawyers are likely to rely on this case in attacking the validity of any decisions reached in reliance on a report of this type, the outcome being any steps taken under such a report, disciplinary or otherwise may be held to be substantively unjustified.

An investigator will breach the Act by undertaking an investigation without holding a licence or practicing certificate and commit an offence.  They will be liable to the imposition of a fine of up to $40,000 for an individual or $60,000 for a body corporate.

If you require advice on employment relationship problems or wish to undertake an independent investigation in your workplace please contact Jaesen