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Discovery of human resources consultant communications in litigation

By April 10, 2023Uncategorized

Employers may be unwittingly helping their courtroom adversaries make their case when communicating with non-attorney advisors

Most people are familiar with the concept that confidential communications between a client and their attorney,  when made for the purpose of giving and receiving legal advice, are privileged against disclosure, under a legal rule of evidence recognized in both federal and state courts known as the attorney-client communications privilege. Under the attorney-client privilege, a courtroom adversary cannot compel the client to divulge the substance of those communications with rare few exceptions (like when the communications are for commission of a crime or fraud). But what about similar communications between a client and a non-attorney consultant, such as a human resources advisor? Many are surprised to learn those kinds of seemingly confidential communications with non-attorney consultants are fully discoverable and can be used against the client in civil and administrative disputes. And the non-attorney advisor can be called testify at deposition and trial as a percipient witness in the case.

To illustrate this point and why it matters, let’s examine the unfortunate tale of an employer against whom I was involved in litigation while representing an employee early in my legal career, nearly 20 years ago.  The employer erroneously classified a long-term employee as exempt from overtime pay even though the employee met only some—but not all—the requirements to be legitimately exempt.

The employee had worked for the employer for many years, regularly worked an average of 60 hours per week according to the timesheets she maintained, and would have been eligible for roughly 20 hours of daily or weekly overtime pay, on average, looking backward during the four-year statute of limitations period. Because the employee was highly compensated, the effective hourly rate of pay was large, and the potential exposure totaled in the six figures for just one employee, even before accounting for attorney fees and litigation expenses.

Through Internet research, the employee discovered the employer’s misclassification of her overtime-exempt status, reported the error to the employer, and asked for unpaid overtime, interest, and penalties totaling six figures.

The employer, astonished and outraged by what seemed to be an audacious demand, promptly fired the employee, then successfully prevented the employee from getting another job in the same industry.

The employee sued in court for unpaid overtime wages, wrongful termination, and interference.

During the civil discovery phase of the lawsuit (which is when the parties exchange written questions to be answered under oath, demand production of documents, and take depositions of witnesses) the employer was forced to divulge and provide copies of all communications with the employer’s non-attorney human resources consultant. These communications would never have been discoverable had they been with an attorney. These non-privileged communications were a treasure trove of damaging information against the employer in the lawsuit, helping assure the employer’s eventual and expensive loss.

Unfortunately for this employer, not only were the consultant’s communications discoverable, but the advice the consultant gave wasn’t very good. That consultant possessed some theoretical knowledge but no practical, real-life experience actually prosecuting and defending employment lawsuits, which showed through obvious blind spots to important (missed) opportunities at several critical moments before the employee filed her lawsuit that likely could have significantly reduced the damage, or avoided the lawsuit entirely.

Non-attorney human resources consultants have a vital and indispensable role in the employment ecosystem. They can cost-effectively assist an employer with payroll and benefits administration, general policy development, compliance training, and routine onboarding or off-boarding procedures, for example.  When facing high-risk employee issues or disputes, however, the best practice for employers is to consult with an experienced employment attorney—ideally one who already knows the employer’s business, has a preexisting and established professional relationship with the employer, and is readily available on short notice whenever a crisis erupts, even on weekends or after usual business hours. Savvy employers plan ahead by having a trusted labor and employment lawyer on retainer so they don’t find themselves in the unenviable position of frantically searching around for an attorney after trouble hits.