As we enter a new year, one of the biggest challenges facing businesses is how to handle workplace misconduct issues.

Rising misconduct issues are a serious business risk and if not handled correctly, they can lead to decreased revenue, damaged reputation and have a negative effect on long term stability. In 2025, the Equal Employment Opportunity Commission (EEOC) reported its largest publicly disclosed workplace misconduct settlement in nearly two decades! Misconduct in the workplace can also lead to low employee morale, poor working relationships and poor employee performance as it negatively affects corporate culture and creates an unhealthy work environment. Businesses must train managers to spot these issues and also educate their employees about their rights and responsibilities.

Misconduct in the workplace happens more often than we may think. It takes many forms and can be obvious or stealth. It can present as serious behaviors such as harassment or fraud, but it can also be small, but harmful habits, like poor communication or unfair treatment of employees by management or other employees. Essentially, it encompasses any behaviors that violate a business’s workplace standards and often shows up as bullying, harassment, discrimination, racism, fraud, theft and more. These issues can occur in any workplace of any size; they can be obvious or hidden in daily behaviors and are often overlooked as everyday behaviors regardless of how attentive the management team may be. Therefore, it is vital that managers are aware and know the subtle, as well as the obvious signs, and what to do when they discover them. Dealing with misconduct in a timely and proper manner can help to protect your employees, promote teamwork, uphold best practices, and help to avoid employee lawsuits.

In the coming year, workplaces need to become more pro-active towards workplace misconduct. This means developing solid plans for handling behavior issues and knowing how to properly document any incidents. Incorporating sound reporting methods, having appropriate accountability, and utilizing effective investigation processes protect employees as well as the workplace. As a result, many businesses are now developing new reporting systems and incorporating unbiased investigations in order to be able to prove core legal compliance. Leaders must now ask the tough questions, develop strong processes as well as apply fast response and documentation procedures. As a result, there is often an increasing need for external investigation support. When internal teams can’t balance day-to-day responsibilities with the time and energy needed to conduct fair, timely investigations, neutrality comes into question and courts are looking to whether the internal investigation may have had conflicts, assumptions, or lacked the time to conduct a thorough review. Human resources are one area where hiring and firing, employee retention and employee relations, and compensation is conducted on a daily basis. The workload is high and if you add high-stakes investigations to that, questions may arise leading to delays, inconsistent documentation, or credibility issues that place the organization at risk. That is especially true in small businesses where the number of available employees is limited or there may be no actual HR department, leading to the need to use outside help for investigating and dealing with workplace misconduct issues. An external investigation firm can bring objectivity, structure, fairness and compliance to the investigation. It also builds trust for employees that the investigation is being conducted in an honest and fair manner and allows them the freedom to be forthcoming in interviews.

In the coming year, being ready to properly handle workplace misconduct should be paramount in all business plans. Getting ahead of any problems, developing good reporting access, conducting neutral investigations, and utilizing strong documentation will help to reduce workplace exposure and liability.