INDIA Law and Practice Contributed by: Preetha Soman, Madhur Khandelwal, Aishwarya Maria Manjooran and Rebecca Thomas, JSA Advocates & Solicitors
Employers may engage specialised agencies or lawyers. While external agencies/counsels are not involved in routine internal investigations, it is quite common to rely on their expertise in matters that may be critical, complex, or sensitive. In such situations, depending on the nature of allegations, employers may engage experts such as auditors, compliance personnel, external lawyers, or forensic/accounting firms. The key advantage of engaging external counsels is the client–attorney privilege, which would be limited in the case of engagement of in-house counsels. If external counsels are being engaged to run HR investigations, it is advisable to ensure that such engagement begins from the commencement of the investigation. However, from a practical perspective, there could be instances wherein external counsels are approached after the preliminary investigation has been completed, owing to complexities that are dis - covered during the course of such investigation. 1.5 Obligation to Carry Out an HR Internal Investigation Circumstances Mandating an Investigation In India, certain laws mandate investigations in spe - cific contexts. The IR Code requires an employer to investigate into grievances arising from a “worker” (non-managerial level employees) through the GRC as set up by the employer. The PoSH Act requires complaints pertaining to sexu - al harassment of women at the workplace to be inves - tigated by the ICC. In cases involving employee misconduct, an employer is required to conduct a disciplinary inquiry before ini - tiating any disciplinary action against an employee, such as termination. This requirement stems from the state-specific Model Standing Orders framed under the erstwhile Standing Orders Act (which will continue to apply unless and until superseded by the new Mod - el Standing Orders to be issued under the IR Code), as well as the state-specific shops and establishments acts.
Further, under laws such as the Disabilities Act and the Transgender Protection Act, although an investigation has not been mandated, compliance with obligations thereunder would often necessitate it. 1.6 Prohibition on Carrying Out an HR Internal Investigation Circumstances Precluding an Employer From Conducting an Investigation There are no fetters from an Indian legal standpoint that prohibit an employer from conducting an HR internal investigation upon recognition of a disruption in the affairs of the company or upon suspicion of a wrongdoing. However, in cases of concerns or allegations where the law specifically provides for an investigation/inquiry mechanism, an employer cannot suo moto initiate an investigation different from the specified forum. For example, in cases of workplace sexual harassment, since there is a specific inquiry mechanism stipulated under the PoSH Act, investigating such a complaint through the HR internal investigation route would not be appropriate, unless the aggrieved woman has her - self chosen not to file the complaint with the ICC and instead proceed with an alternate inquiry/investigation process. 1.7 Other Cases When to Initiate an Internal Investigation If applicable laws or company policies indicate that investigations need to be conducted in certain circum - stances (for example, sexual harassment of women at the workplace), appropriate investigation will need to be initiated. Otherwise, whenever there is a disruption in the normal affairs of the company or any suspicion of a wrongdoing or breach of company policies, an internal investigation may be initiated. In some cases, the claims/complaints received could be serious enough to warrant an immediate investiga - tion such as a claim of harassment, threat to health and safety, or violence at the workplace. Likewise, employers may also opt not to conduct HR investiga - tions for minor or insignificant issues, for example, a
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