Employers must be vigilant to protect attorney-client privilege
Tuesday, February 06, 2018
Communications between a client and its attorney(s) for the purpose of obtaining legal advice are considered privileged communications. The privilege belongs to the client, not to the attorney, and the burden rests with the client to show that the privilege was not waived.
In employment cases, where the employer-client may include numerous individuals, it is important that all of those individuals know how to protect the privilege and to guard against inadvertent or unintended waiver of the privilege. Otherwise, if the privilege is waived, disclosure of such communications can be devastating to the employer's interests.
What communications are privileged?
Privileged attorney-client communications in employment cases may include requests by the attorney or inside representatives of the employer on behalf of the attorney for facts, communications or information needed to provide legal advice; the actual or purported facts, communications or information; and legal advice provided by in-house or outside counsel. But keep in mind that the underlying facts in a given situation may not be privileged.
The Supreme Court of the United States established the following guidelines more than 30 years ago for determining when the privilege applies to corporate employees:
- Were the communications made by a corporate employee at the direction of superiors for purpose of obtaining legal advice?
- Did the communications contain information necessary for counsel?
- Were the matters being communicated within scope of the employee’s corporate duties?
- Did the employee know that the communications were for the purpose of the corporation obtaining legal advice?
- Were the communications ordered to be kept confidential by the employee’s superiors?
Whether the privilege applies to a particular situation depends on the facts in a particular situation.
How can the privilege be waived?
Common situations creating a waiver of the privilege may include, among others:
- Intentional disclosure of otherwise privileged information or documents to more people than only those who need to know or have such information;
- Inadvertent dissemination, such as by combining privileged communications with business or other non-legal matters in one communication; or
- Disclosure by the employer to establish a defense in legal proceedings.
What can an employer do to protect the privilege?
To avoid the risk of waiving the privilege, employers should:
- Anticipate potential types of legal claims and have a plan for protecting relevant information or communications;
- Create and implement internal policies and procedures for preserving and managing documents, data and communications with attorneys;
- Develop a specific team of people responsible for being involved in each type of legal matter;
- Minimize the number of internal employees on the team privy to information regarding legal matters;
- Limit privileged communications to just the designated team;
- Be careful about sharing information with third parties;
- Preserve confidentiality of emails and other written communications by clearly marking them as "confidential and privileged attorney-client communications;"
- Do not overuse the privileged marking, as that may actually weaken your ability to protect truly privileged communications;
- Memorialize in the communication that legal advice was requested (for example, the subject line could read "Request for Legal Advice" or the message could begin "I need your legal advice on ..." The lawyer should then reply "In response to your request for legal advice ...");
- limit communications to just one subject and do not intermingle privileged matters with purely business matters;
- Keep communications from your lawyer segregated and not in employees’ personnel files;
- When conducting internal investigations, include a reference that the investigation is being undertaken for the purpose of obtaining legal advice on the situation;
- If you have an employee hotline or reporting procedure, include language to the effect that any investigations will be at the direction of either in-house or outside counsel and for the purpose of providing legal advice to the company;
- Train and educate managers and employees on the important concepts of privilege;
- Include language in your document retention policy about how the employer intends to protect its attorney-client privileged communications;
- Make decisions with regard to legal matters or those that may result in legal action at the management level;
- Direct questions about protecting the privilege to counsel; and
- Remember that international laws governing the privilege may differ (for example, there is no in-house counsel privilege in most of the EU countries).
The attorney-client privilege will be construed narrowly. It can protect many communications between an employer and its counsel but only if the employer understands the scope of the privilege and how to protect it, as outlined in this article.
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