When HR breaks bad

A recent case of an HR manager accused of misappropriating over $180,000 in company funds for her own use underscores a critical vulnerability for organizations: the catastrophic fallout when HR professionals breach the trust placed in them. 

The HR manager was employed with a company in Nebraska, where she used a company credit card and transferred money from company accounts to make purchases on Amazon, DoorDash — and even a five-day stay in Hawaii through Airbnb. She was charged with theft greater than $5,000, which is a felony in that state. 

More famously, at a July 2025 Coldplay concert in Boston, the CEO and CHRO of AI company Astronomer were caught cuddling by the concert’s “kiss cam,” projected onto the stadium’s big screen for all to see. After it was discovered who they were, both resigned from their positions. 

Although these circumstances happened south of the border, it serves as a stark reminder that HR departments anywhere, long positioned as guardians of workplace ethics and policy enforcement, have elevated accountability standards. When that role is compromised by misconduct, the damage can extend far beyond the individual involved. 

HR holds a unique position 

HR professionals occupy a distinctive position within organizations — as the internal face of policy implementation and employee governance, HR leaders are expected to embody and enforce the very standards that guide organizational conduct, says Catherine Connelly, professor of human resources and management at McMaster University. “Any leader would have a certain expectation of behaviour and they’re the external face of the company, so the standard would always be higher for them,” says Connelly. “But HR is often the internal face of the company — they’re the embodiment of every policy and are frequently tasked with enforcing the policies."  

This dual responsibility creates heightened expectations, according to Connelly. She says that employees interact with HR regularly through recruitment, onboarding, benefits administration, and leave requests, which differs markedly from other business functions. Most employees understand HR's role in their working lives, meaning any missteps receive proportionally greater scrutiny than lapses in less-visible departments. 

“There's an expectation that [HR] will be able to at least follow the policy that they’re assumed to responsible for,” says Connelly. 

Cascading organizational fallout 

When HR leaders breach ethical boundaries — whether through financial misconduct, abuse of power, or mishandling confidential information — the consequences for organizational culture can be significant, as the damage strikes at the foundation of employee trust and psychological safety, according to Cynthia Miller, Director General of People and Culture at the National Film Board of Canada. 

“[HR] is the backbone of an institution or of an organization, so if you're not able to trust the body that’s supposed to uphold a policy or standard, all of these processes and directives where it’s the owner, then who can you turn to — you go to your manager, then HR handles the complaint,” says Miller. “A culture of trust becomes a culture of distress.” 

Miller believes that when trust in HR erodes, employees lose confidence in reporting mechanisms designed to protect them, which creates a reporting vacuum. Employees with legitimate concerns about harassment, discrimination, or misconduct have nowhere safe to turn when the institution responsible for handling such complaints has itself become suspect, she says. 

The cost of perceived double standards 

The damage intensifies when organizations appear to apply different standards to HR leaders and their teams than to other employees, says Connelly. She believes employees are acutely sensitive to fairness in disciplinary processes, and inconsistency breeds cynicism. 

"If misconduct is widely known, and it's reported and then nothing happens, or it's a lighter penalty than most people would experience, then that's when people have this sense that it's different rules depending on who you are,” says Connelly. “It's this feeling of uneven justice that you can’t trust the outcome, you can’t trust the process, or even that there's a superficial kind of performative policy that's really just for show and isn’t designed to protect people who aren’t in the ‘in’ group — and so therefore why would you ever report anything ever?”  

As a result, the organization loses visibility into workplace problems until they escalate into lawsuits, human rights complaints, or public scandals, adds Connelly. 

Mitigating damage with decisive action and transparency 

Organizations can mitigate damage through two parallel strategies: consistent disciplinary action and transparent communication, according to Connelly. “To fail to take action just sends the message that either the company doesn't actually take this seriously, so everybody should be misusing company credit cards, or that there are only certain rules for certain people. And that's also just so demoralizing for all the employees who follow the rules.” 

Connelly suggests that an external investigation, or at least someone investigating with expertise who operates at arms length, and a resolution should happen quickly so the organization isn’t seen as dragging their feet. 

Equally critical is communicating the process and outcome to the broader workforce. Organizations often err toward excessive discretion, attempting to protect the dignity of involved parties, but this creates a vacuum that employees fill with speculation, says Connelly. 

“People will just invent their own story just to make sense of their place in the world, what the world is like, what their organization is like, and how things will be handled in the future,” she says. “And their own story may or may not be realistic.”  

While acknowledging that confidentiality is important, employees need sufficient information to understand what policy was breached, what action was taken, and what would happen in similar scenarios, adds Connelly. 

Establish accountability standards 

For HR leaders and their teams to restore and maintain trust, they must embrace higher accountability, says Miller. “We have to be able to uphold higher standards, obviously, be able to show what needs to be done ethically, and talk about those boundaries,” she says. 

Miller believes that organizations can strengthen accountability through formal governance structures that prevent unchecked authority, such as what happened with the Nebraska HR manager who had unfettered access to company finances. Multiple layers of approval, segregation of financial duties, and oversight committees ensure that no single HR leader or individual can unilaterally circumvent policy, she says.