When Must Employers Launch Investigations?

Employers are increasingly confronted with allegations of misconduct, regulatory breaches or inappropriate workplace behaviour that require careful assessment. Legal obligations to conduct internal investigations vary significantly between jurisdictions: some countries impose statutory duties while others rely on case law or good practice principles.

This overview provides a short guide to the key requirements and common practices in four major European jurisdictions. The different ways in which each of them deal with investigations should provide a useful overview for employers on how to navigate these issues effectively.

Netherlands

There are no statutory rules on conducting investigations, so an employer is never required per se to conduct an investigation. However, in cases of misconduct that may warrant a summary dismissal for cause, it is common practice to conduct an investigation into the alleged misconduct. Misconduct may constitute a reason for dismissal, either following a court procedure or for cause. Case law provides that employers must ensure that all facts of each case are clear before dismissing an employee. Most cases therefore require some form of investigation, and it is strongly advised that the process include hearing the employee to allow them to give their side of the story.

Some cases may require the employer to hire an external investigator. Several specialised business investigation companies in the Netherlands can investigate cases requiring specific expertise, such as alleged fraud or (sexual) harassment.

Employers must ensure that investigations, whether internal or external, are executed adequately and diligently, respecting the positions of both the complainant and the subject of the complaint.

Germany

An obligation to conduct an internal investigation can arise from the employer's general management duties. If there are sufficient factual indications of a compliance violation, management must immediately initiate appropriate measures to investigate and clarify the facts.

Corporate regulations also require the management and supervisory boards of stock corporations to take measures to ensure that developments that could jeopardise the company's continued existence are identified early. German corporate law stipulates that Executive Board members must exercise the due care and diligence of a prudent and conscientious manager. This includes an obligation to initiate investigations in the event of legal breaches. The Supervisory Board, which must monitor the Executive Board, is bound by a similar duty to investigate potential breaches.

Typical subjects of internal investigations include issues relating to accounting law, supervisory law, insider trading law and discrimination law. These investigations can also serve to identify structural or individual misconduct.

Sweden

It is common for employers in Sweden to conduct an investigation whenever an allegation is raised at the workplace. There are also specific occasions when an employer is legally required to investigate, i.e. when the allegation concerns discrimination or work environment issues.

The employer must investigate as soon as it learns that an employee believes they have been subjected to harassment or sexual harassment. Anti‑discrimination legislation and Work Environment Authority regulations require employers to have procedures for preventing and handling sexual harassment and victimisation. These must set out who the victim should contact, what the employer will do upon receiving a complaint, how information will be treated and who is responsible for investigating.

The employer must thoroughly investigate the harassment and prevent it from continuing. The obligation arises regardless of how the employer becomes aware of a suspicion. If someone other than the victim informs the employer, the employer must ask the affected employee whether harassment occurred.

The scope of the investigation depends on the circumstances. It must be conducted discreetly and with consideration for those involved. The employer should speak to the alleged victim, the alleged perpetrator and, where relevant, witnesses, and assess whether protective measures are needed during the investigation.

Another mandatory investigation scenario is when a serious personal injury, death, multi‑worker accident or incident involving serious danger to life or health occurs. The employer must report such events to the Work Environment Authority and investigate what happened and implement measures to prevent recurrence.

France

In France, employers must immediately conduct an investigation when requested by the Social and Economic Committee, especially in cases involving infringement of employee rights, serious danger, or public health issues. Investigations are also strongly recommended for matters such as corruption, fraud, harassment, and discrimination.

Case law requires employers to investigate allegations of workplace discrimination or harassment to assess their seriousness and take remedial action if needed. Failure to investigate can lead to damages for not preventing occupational risks. The French Human Rights Defender advises prompt, impartial, and thorough investigations, especially for complex or disputed cases, and recommends training managers on handling such reports.

Whistleblowing legislation protects whistleblowers and requires employers to follow up on reports, often by opening internal investigations to determine if laws or regulations have been breached. Investigations also support disciplinary proceedings when misconduct is suspected.

There is no detailed legal framework for investigations, but they must be conducted discreetly, respecting confidentiality and privacy, and be proportionate to the facts. Employers must comply with data protection rules and ensure fairness. Labour inspectors or collective agreements may also require investigations.

Overall, while not all investigations are legally mandatory, French law imposes clear duties to investigate in specific situations, and employers are advised to act promptly and fairly.

Takeaway for employers

• Know when investigations are required: some jurisdictions impose clear legal criteria (e.g. France and Sweden), while others rely on general management duties or best practice (Germany and the Netherlands).
• Respond without delay: prompt action is expected everywhere, regardless of the legal framework.
• Ensure fairness and confidentiality: investigations must be impartial, discreet and compliant with data‑protection rules.
• Protect employees during the process: safeguard complainants and consider temporary measures where needed.
• Keep clear documentation: well‑kept records support decisions and reduce legal risk.
• Use external specialists when appropriate : eg. for sensitive or complex cases such as fraud or harassment.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.