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How to Place an Employee on Administrative Leave

Administrative Leave is a common practice used by companies when they are investigating claims that are more severe or emotionally charged. The purpose of an Administrative Leave is to remove the accused party or parties from the workplace, ensuring the safety of the workforce and allowing for a thorough and untainted investigation to occur. The leave protects individuals who may have been victimized by the accused, i.e. a person who has claimed they have been harassed or intimidated. Removing the accused from the workplace also allows the accused to work without fear of retaliation or further harassment. It makes it easier for witnesses to be more forthcoming in their accounts of events that have taken place. Additionally, removal of the accused from the workplace protects the evidence or records from being tampered with or destroyed; especially in the instances of white-collar criminal activity such as embezzlement or insider trading. While there are many reasons to support temporarily removing (with or without pay) the accused from the workplace during an investigation, the accused should never be subjected to a “sloppy” investigation process. Insufficient and ineffective communication with the employee who is being placed on leave can be emotionally devastating. It is important the investigation happen as quickly as possible and that the “water cooler” gossip is kept to a minimum. A delay in investigating the claim could lead to the spreading of false information and prolonged suspension of interaction with clients or accounts which can cause irreparable damage to a professional’s reputation and income.

How do I have a conversation about Administrative Leave?

Conversations aimed at putting an employee Administrative Leave should begin with an outline of what the process will be.  The employee needs to have an explanation as to why the leave is necessary. For example, they are the subject of an investigation into an allegation that has been made, and they will be placed on Administrative Leave until the validity of the allegation can be determined. The employee needs an indication as to whether they will be receiving pay and benefits while they are out and approximately how long you feel the leave will be for. It is also important to let the employee know who within your organization will be contacting them with updates and who they should contact should they have any questions. You will need to instruct the employee that since this is an investigation, they should not be discussing their leave with other employees of the company until such time as the matter has been resolved.

Until you have uncovered enough evidence to terminate the employee, it is important to try to preserve the reputation of the employee within your business as much as possible. Limit discussions regarding the investigation only to the individuals who “need to know”. Remember, until the investigation proves otherwise, there is a chance the employee will need to return to work. It is important that if that happens, the work environment the employee returns to not be hostile or uncomfortable.

What should I prepare for?

Assume that situations that possibly involve criminal activity such as theft, may mean that a smart employee, after being placed on Administrative leave, will be smart enough to hire an attorney. This means as a business owner, you need to be prepared to deal with the attorney’s questions and requests for information. You will also want to go about the investigation in a way that would be supportive of a criminal complaint should the evidence in the investigation indicate theft did occur. The best way to navigate these waters would be for you to utilize an attorney of your own, and I would discourage you from communicating with your employee’s attorney directly – you can inadvertently release information or say something that can be used against you later.

Placing someone on Administrative Leave can be tricky for a business owner. It is always best to have a Human Resources Professional to guide you through the process on informing employees about their Administrative Leave and taking over any necessary investigation for you. Assuming you do not have HR on staff to assist you in these matters, you can consult with a 3rd party HR expert to get you through what could be a difficult and delicate time.

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Law 4 Small Business, P.C. (L4SB). A little law now can save a lot later. A Slingshot company.

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