Should employees interviewed in internal investigations be provided counsel?

In my last article I discussed some of the considerations that should go into a decision of when to self-report potential enforceable misconduct to government authorities. The government claims to provide significant benefits to companies who do so.

The government also claims that it grants leniency to companies that “cooperate” with its investigations into corporate conduct. “Cooperation” in this context essentially means giving the government information related to employee misconduct. The DOJ’s FAQ’s say: “a company must turn over all non-privileged relevant information about the individuals involved in the misconduct in order to receive any consideration for cooperation.” The ethics of this has always bothered me.

Whenever internal counsel interviews employees about potential misconduct, they provide what’s known as an “Upjohn warning” that makes clear to the employees that the company’s lawyers do not represent them and that anything they say during the interview can be used against them by the company and may be turned over to government prosecutors. Employees typically are not warned that they may face criminal liability for the conduct being investigated. I have rarely, if ever, heard of an employee who requested to delay the interview so they could seek the advice of counsel before answering questions.

This has always raised the ethical question for me as to whether the investigators should proactively recommend that employees suspected of misconduct seek counsel, or whether the company should proactively provide counsel to such employees. Inside and outside counsel have strenuously advised me against doing so because the government could interpret that as an effort by the company to prevent evidence of misconduct from being discovered. While I understand the advice, it has always bothered me.

The mere act of inside and/or outside counsel requesting an interview with an employee is coercive. Most employees will feel they have no choice but to answer questions put to them at a time chosen by the company. They likely fear losing their jobs as much or more than any criminal liability they may face, if they even realize they are in legal jeopardy. Only the most courageous and/or sophisticated employees are likely to ask for counsel.  

Consider for a moment an employee who completes his interview, and, in the course of doing so, provides incriminating evidence about his conduct. The company now has interview transcripts from an employee who has essentially confessed to a crime. The company can trade that evidence for cooperation credit and leniency for the corporation. This puts the company’s and the employee’s interests in direct conflict and only one side is typically sophisticated enough to know and understand it.

Hasn’t the company in this situation just deprived the employee of his or her 5th amendment right against self-incrimination (or at least jeopardized them?)? If counsel for the employee had been present they surely would have advised the employee not to incriminate themselves in their answers. But they weren’t, so the employee incriminated himself. You can argue employees have no Fifth Amendment right to invoke in private company investigations. But when that private company plans to deliver evidence of criminal conduct to a government prosecutor, that argument gets pretty murky legally and ethically. The employee probably can’t unring the bell.

I really resented the government pitting companies against their employees in this manner. While I certainly want to catch, stop and punish misconduct, I don’t want to do it by potentially depriving employees of their rights. The government, internal and external counsel, and state bar associations need to seriously wrestle with this issue.  

In my opinion, the ethical rules should require that employees be provided counsel when companies anticipate being placed in the position of receiving cooperation credit in exchange for self-incriminating evidence from their unrepresented employees. This would protect employees, while at the same time alleviating valid concerns about the government’s potential negative response to companies providing counsel to their employees.