THE COST OF A FLAWED INVESTIGATION: LESSONS FROM PANCHAL V BULLA MUSHROOMS

Workplace investigations are critical for maintaining fairness, ensuring accountability, and protecting both employees and employers. Yet, when they are rushed, biased, or poorly conducted, they can lead to unjust outcomes, costly disputes, and reputational damage.

One recent case, Panchal v Bulla Mushrooms (Aust Pty Ltd) [2024] FWC 2784, highlights the dangers of flawed investigations and serves as a valuable lesson on the importance of conducting thorough, impartial inquiries before making disciplinary decisions.

How a Poorly Run Investigation Led to an Unfair Dismissal

Vanitaben Panchal, a harvest team leader at Bulla Mushrooms, was dismissed after allegations surfaced that she had engaged in bullying and discrimination against multiple employees over two years. The claims included:

Reducing an employee’s work hours as retaliation;
Raising her voice at workers in an aggressive manner;
Isolating employees from workplace programs and opportunities; and
Engaging in racial and religious discrimination by excluding certain individuals.

While these allegations were serious, Ms. Panchal strongly denied them, providing explanations for her actions. Yet, it was found that during the investigation and inquiries into the allegations, her employer failed to give her adequate time to respond and proceeded with a dismissal based on incomplete and unverified claims. The Fair Work Commission determined that the investigation lacked fairness, the employer had relied on unsubstantiated allegations and failed to ensure procedural fairness, leading to an unfair dismissal ruling.

Why a Proper Investigation is Non-Negotiable

Cases like this emphasise why workplace investigations must be handled with diligence and professionalism. Set out before are five key considerations during workplace investigations:

1. Conduct a Fair, Impartial Process

An investigator must be impartial and objective in their dealings within the process. Further, available evidence needs to be collected, and procedural fairness needs to be followed. This includes but is not limited to allowing the respondent a fair opportunity to respond to the allegations. The Bulla Mushrooms case highlights how rushing to conclusions, relying on one-sided accounts and/or dismissing evidence without merit can lead to procedural unfairness.

2. Follow a Clear and Consistent Procedure

Employers should have a structured investigation process and procedure in place. Not only will this lead to procedurally fair investigations but also assist in ensuring consistency. This is particularly relevant for large organisations where multiple individuals may be conducting workplace investigations. Further, ensuring that investigations are reviewed with the same level of scrutiny from decision-makers can ensure that outcomes will stand the test if ever challenged.

3. Understand Legal Risks and Obligations

Understanding the principles of evidence, legal obligations and company policies ensure fair and robust investigations. Further, by considering what risks exists through proactive identification can ensure that these risks are mitigated from the start of the investigation. As evidenced through the Bulla Mushrooms case, ignoring due process and key principles of evidence can result in wrongful dismissal claims, financial compensation orders, and reputational damage.

4. Ensure Confidentiality & Professionalism

Workplace investigations must be handled discreetly, protecting the privacy of all involved parties and avoiding unnecessary workplace disruptions. This extends to not only the complainant or witnesses but the respondent as well. All parties involved should be made aware of not only the organisation’s responsibilities in relation to confidentiality, but their obligations as well. Setting out these obligations in writing to the respective parties can ensure no ambiguity and a clear record of confidentiality directions exists.

5. Engage Skilled Investigators

Perhaps the most important takeaway: workplace investigations should be conducted by professionals who have experience in handling complex disputes. Subject to the size of the organisation, that may mean needing to engage external investigators. For smaller organisations, tasking a manager to conduct an investigation, because of their ‘seniority’, may seem like a good option, however, can be costly down the road.

Final Thoughts

A poor investigation can result in incorrect procedures, wrongful terminations, reputational damage, financial penalties, not to mention a deteriorating workplace culture. Employers must prioritise fairness and professionalism within investigations, taking time to conduct thorough investigations and ensuring that those handling them have the right expertise.

If you’re an employer, ask yourself: Are my workplace investigations being handled properly? If the answer is not a confident “yes,” it may be time to consider upskilling those who conduct investigations or consider outsourcing your investigations to experienced professionals who can safeguard fairness.

We help organisations uncover the truth and make the right decisions.

What our clients say

Darren, Ian, Dylan and the team at Core Integrity bring a breadth of public and private sector experience to our team. Our staff now have a secure, confidential and safe way to speak up when they see something wrong in the workplace. The integrity hotline provides a vehicle for our staff to come forward in a confidential way should they wish to with the comfort that someone will listen and take the necessary action. Core Integrity have also provided us assistance in strengthening our fraud risk management processes and help us build strong intelligence networks with law enforcement and other agencies.

The team are committed, polished and professional – I would be more than happy to speak with anyone thinking about taking them on to share our experience.

Core Integrity are quite simply fantastic to work with. Darren and the team are incredibly passionate and knowledgeable in their field of expertise, they’ve supported us so well in establishing our Speak Up policy and program – they make it easy to work with them. Thank you!

The Core Integrity team has a passion for creating a safe speak up culture and the desire to get immersed into your business. They don't just provide a cookie cutter solution. They want to understand the people and what drives them. With the Speak Up Integrity Hotline, I knew that our people would be well looked after.

Core Integrity provided our organisation with great support when we implemented our Speakup Hotline and Corethix portal, tailoring their products to our needs and ensuring a collaborative process throughout. Darren and his team have a wealth of expertise in the area of risk and compliance that instils a lot of confidence in our day-to-day dealings and for addressing any issues as they arise.

Utilising Core Integrity and the Corethix platform has been transformative for our organisation. By tailoring Corethix to reflect our industry and organisational needs, we have been able to efficiently streamline our compliance and HR processes. Our staff now have the ability to manage their workplace obligations digitally with little difficulty. The Core Integrity team are always happy to provide support and excel in providing us with expert advice.

I am thrilled to share my experience with Core Integrity. Their team went above and beyond to meet my needs. From the initial consultation to the final delivery and outcomes, every step was handled with professionalism and care. The quality of their service exceeded my expectations, and I would highly recommend them. Thank you, Kim, Darren and Dylan for your outstanding support.

Corethix has been an extremely valuable system for us to implement and use at RMHC VIC & TAS in terms of moving everything across to a digital interface. As a federated business model, we have local policies, national policies and global policies that are frequently updated and distributed, and that all employees must attest / be aware of. Corethix has provided on online distribution and attestation method and finally got rid of paper, scanning and emails – life changing for us! In addition, the certificate module, gives the employees a sense of ownership and pride as they upload their certs. It reduces HR email traffic in this space and gives us a central platform to record T&D. we look forward to exploring more of the modules as we further embed Corethix into the business.

Need the help of the Workplace Investigation Service Experts?
Call now: 1300 020 380

THE COST OF A FLAWED INVESTIGATION: LESSONS FROM PANCHAL V BULLA MUSHROOMS