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Can Lyons v Longford Westmeath Education and Training Board already be distinguished on its facts?

AUTHORs: Bryan Dunne Services: Employment, Pensions and Benefits DATE: 26/07/2017

The recent decision of the High Court in the case of Lyons v Longford Westmeath Education and Training Board is being closely watched by employers about to engage in internal investigations.  In that case, the High Court held that the right to fair procedures and natural justice (which includes the right to legal representation during meetings and the right to cross-examine witnesses) applies at the preliminary investigation stage where the matter is sufficiently serious that it may warrant dismissal.

It has been generally accepted that the principles of fair procedures and natural justice need not apply to investigations that do not involve any findings of fact, but do apply to inquiries which can make formal findings.  In Lyons, a key distinguishing factor may be that the external investigating body issued a report of its findings and formally decided upon the bullying allegation made against Mr Lyons.

Two further decisions of the High Court on the issue of fair procedures during investigations were issued shortly after the Lyons decision.  They do not refer to Lyons, but they do reinforce the generally accepted principle that fair procedures do not apply in full at the preliminary investigation stage, assuming the investigation is not the final decision on the allegations, and may provide some support for distinguishing the Lyons decision on the facts particular to that case.

E.G. v The Society of Actuaries in Ireland

The first is a decision of McDermott J in the High Court made on 16 June 2017 in the case of E.G. v The Society of Actuaries in Ireland.  This was a case involving an allegation of professional misconduct made against the applicant, a member of the Society of Actuaries in Ireland.  An Investigative Committee was appointed by the Society to determine (i) whether there was prima facie evidence of misconduct and (ii) whether to refer the matter to a disciplinary tribunal.

The Investigating Committee found there was prima facie evidence of misconduct by the applicant and referred the matter to a disciplinary tribunal.  The applicant argued that the Investigating Committee's finding of prima facie evidence of misconduct and the investigative process generally was in breach of the principles of natural justice and sought an order to set aside the Committee’s determination.

Reliance was placed on the judgment of Edwards J in the High Court case of O'Sullivan v Law Society of Ireland [2009] IEHC 632, which was upheld by the Supreme Court, in particular his findings that the level of fair procedures and natural justice that applies at investigation stage depends on the actual nature of the investigation.  In that case, Edwards J ruled that if the investigation has the potential to result in the making of an adverse finding and / or the imposition of sanctions against the person under investigation, that person should be afforded fair procedures and natural justice appropriate to a formal disciplinary inquiry.  If, on the other hand, the investigation is a preliminary step and the investigator does not have the power to make findings or impose sanctions upon the subject, but it is merely a fact gathering exercise to determine if there is a basis for a disciplinary inquiry, then less formal procedures may be adequate and appropriate.

McDermott J was satisfied that the Investigating Committee was involved in an information gathering process which went no further than a decision as to whether there was a prima facie case of misconduct, which would then be finally determined by a disciplinary tribunal.  He was therefore satisfied that the full extent of rights, including in particular an opportunity to cross examine witnesses, was not required at the investigation stage and that the decision reached by the Investigating Committee was not in breach of fair procedures or natural justice.

Of relevance to the Court's decision was the fact that the Investigating Committee made no decision of a final nature against the applicant, nor imposed any sanction upon him.  This can be distinguished from Lyons where the bullying allegation was decided by the external investigator.

N.M. v Limerick and Clare Education and Training Board

Similar findings were reached by the High Court in the case of N.M. v Limerick and Clare Education and Training Board, a further judgment of McDermott J delivered on 27 June 2017.

This case concerned an application by a teacher for an injunction to restrain the continuation of any investigation or disciplinary process by the respondent in respect of allegations of sexual harassment and unprofessional conduct made against him.

An external investigator was appointed to conduct the investigation.  The terms of reference circulated outlined that the investigator would prepare a report setting out the findings of the investigation, "including findings of fact".

The case does not consider the applicant's right to legal representation at the investigation as the respondent conceded this at that stage.  It does, however, consider whether the applicant was entitled to the right to cross examine witnesses at the investigation stage.

The Court again considered the judgment of Edwards J in O'Sullivan v Law Society of Ireland and noted that a distinction must be drawn in the standard of fair procedures applicable to an investigation which is an information gathering exercise only.  On that basis, the Court was satisfied in this case that:

(a) the procedure set out in the terms of reference was fair and appropriate and that the applicant was not entitled to an opportunity to cross examine others at the investigation stage; and

(b)  even if it did involve an element of fact finding, the decision to be taken by the investigators could not be regarded as a "final or binding finding of fact" against the applicant.

It noted that the purpose of a disciplinary hearing is to ensure that principles of fair procedures and natural justice are observed in the final determination of the complaints.

Key take-away for employers

A notable difference between the above two cases is that, in the second case (N.M. v Limerick and Clare Education and Training Board), the employer went that bit further than in the first case in that the brief to the investigator was to make findings of fact,  However, it was still able to successfully defend the case on the basis that the investigator did not make any binding findings of fact against the teacher which could lead to the imposition of sanctions.

These two judgments provide further support for the point that where employers wish to avoid the full impact of Lyons,  any initial investigation should very clearly just be a fact gathering exercise to determine if there is a case to answer, before a separate disciplinary hearing that will decide if the allegations are proven or not.  Where, on the other hand, the investigator appointed will reach formal findings, the principles of fair procedures and natural justice will apply during that investigation process, which includes the right to legal representation and the right to cross examine one’s accuser.

These two more recent cases are definitely helpful for employers as they support the view that the Court reached its decision in Lyons because the external investigating body made a formal determination on the bullying allegation at the investigation stage.  The one question, that still casts doubt over this view,  is Judge Eager's general comment in Lyons that even though most employers don’t build fair procedures into the investigation stage, they should be doing so.  Until we have a High Court decision that directly addresses Lyons, we will not know for certain how the High Court will deal with this point going forward.

Helpfully, the Court also reiterated that during an internal investigation, it is inevitable that a decision maker and investigator will have some form of communication about the issues or involvement at the initial stages and that they cannot be "hermetically sealed" which is a useful point for those in senior management and in HR who are involved in overseeing such processes.

For more detail on Lyons and these two judgments, see episodes 26 and 27; episode 27 will follow in the coming days on the Matheson Employment Law Podcast Series.

Authored by Bryan Dunne, Niall Pelly and Geraldine Carr.