Internal or external investigator? What you need to know for a successful employment investigation

I regularly carry out employment investigations, representing employees and employers in the investigation process, and I know that as an employer you want an investigation that is set up in the most efficient and cost-effective way, that provides the best possible outcome for the organisation and its people, and that minimises risks. 

However, investigations can be disruptive, costly, and potentially damaging to the reputations of organisations and individuals.

While there is no presumption by the courts that an external investigator is required, one of the key questions that employers need to consider before embarking on an investigation is “should I appoint an external investigator or keep it internal?”

So let’s look at three key considerations.

  1. Do you have the skill set and capacity?

First, consider if you have the skills or capacity internally to take on this investigation. To help you with this, consider these questions:

  • How serious are the allegations?
  • How complex is the evidence?
  • Are there potential issues with credibility? Are there serious allegations but no independent witnesses, say to a sexual harassment claim. You will need an investigator who understands the tests the courts regard as acceptable to determine relative credibility. 
  • Do you have the trust and confidence of all parties?
  • Are you able to deliver an investigation in a timely manner?

It’s also important to note that there are two phases to employment investigations: the investigation of the facts and then – if required – the disciplinary process. You determine the facts first. Only then do you move on to decide whether some disciplinary step is justified. You need to ensure the process resulting in  a disciplinary step (for example, dismissal) complies with employment law requirements from start to finish.

  1. Is there bias?

If the complaints are complex or sensitive and relate to harassment or bullying, you will want an external person to give assurance of objectivity. A biased investigation will not withstand attack.

As an employer you have obligations both to complainants, and to the subject of complaint. There is a specific duty in s117 of the Employment Relations Act 2000 to enquire into harassment complaints.

  1. The status of the investigator

If you decide on an external investigator, they must not be in a solicitor/client relationship with you as the employer, or an advisor to the employer. They must be truly independent

Furthermore, the external investigator can’t be given ‘instructions’ by you/the employer. The Terms of Reference control the scope and process. Once the Terms of Reference are agreed the investigator carries out the investigation according to the Terms of Reference. The employer must not interfere with or try to direct the course of the investigation.

Finally, the investigator is not an advisor to the employer. The investigator finds the facts. The employer then, taking advice from their lawyers or other advisors as required, decides on the outcome.


Engaging an external investigator can be a useful step in resolving contentious workplace issues where there are contested allegations, in particular where the allegations are sensitive.

But investigations can be costly and disruptive, and can  consume enormous amounts of time. They need to be tailored to the particular situation. The drafting of appropriate terms of reference is a key step, as is the decision to appoint an external investigator as opposed to carrying out the investigation internally.