The University of Michigan Football Coach case proves that “we have a policy” means nothing if you’re not willing to enforce it.
As an employment law attorney with over 25 years watching small businesses navigate workplace disasters, I can tell you the most expensive three words in business: “Everyone already knew.”
That’s the phrase that turns manageable HR situations into legal nightmares. It’s what transforms a policy violation into evidence of institutional negligence. And it’s exactly what happened at the University of Michigan when head football coach Sherrone Moore was terminated in December 2025 for an undisclosed relationship with a staff member—a relationship that, according to reports, was widely known within the program.
The university had policies. They had reporting mechanisms. They even had rumors and hotline reports. What they didn’t have was timely, decisive action until the situation exploded into criminal charges and a very public termination.
For small business owners, this case offers a stark lesson: Your complaint procedures are only as valuable as your willingness to act on them.
The Anatomy of an “Open Secret”
Here’s how it typically unfolds in small businesses:
Your top salesperson is dating someone on their team. Your operations manager has an obvious relationship with a subordinate. Your best technician and the office coordinator are clearly involved. People talk. Everyone notices. Someone might even mention it to HR or management.
And then… nothing happens.
Why? Because they’re good at their jobs. Because you’re worried about losing them. Because investigating feels uncomfortable. Because maybe they’ll just work it out themselves. Because you convince yourself that if it were really a problem, someone would file a formal complaint.
Sound familiar?
According to the Michigan case details, the relationship between Moore and his executive assistant went on for years. Sources indicated it was widely known within the football program. The university reportedly received hotline reports about Moore’s conduct. Yet decisive action didn’t come until the staff member herself came forward with proof after Moore allegedly fired her when told to “distance himself” from her.
By then, the damage was catastrophic: a for-cause termination, criminal charges, and a very public scandal that called into question the university’s entire approach to workplace accountability.
Why “Having a Policy” Isn’t Enough
Many small business owners fall into the trap of believing that having an employee handbook with complaint procedures alone provides legal protection. It doesn’t.
Courts and regulatory agencies don’t just ask “Did you have a policy?” They ask:
➤ Did employees know about the policy and how to use it?
➤ When complaints were made—formally or informally—did you investigate promptly?
➤ Was your investigation thorough and impartial?
➤ Did you take appropriate corrective action based on your findings?
➤ Did you protect the complainant from retaliation?
The Michigan case demonstrates what happens when the answer to any of these questions is “no” or “not really” or “eventually.”
What “Adequate Investigation” Actually Requires
Small business owners often ask me: “Do I really need to investigate every rumor?” The answer is more nuanced than yes or no, but here’s the framework:
When You Must Investigate
You have a legal obligation to investigate when you become aware of potential:
- Harassment or discrimination
- Safety violations
- Policy violations involving supervisory relationships
- Retaliation
- Other conduct that could create legal liability
Critical point: “Aware” doesn’t just mean formal written complaints. It includes rumors you overhear, patterns you observe, anonymous tips, or concerns raised by other employees—even casually.
What Makes an Investigation “Adequate”
Timeliness Matters Investigation should begin within days, not weeks or months. Waiting until you have “enough evidence” to justify investigating is backward. You investigate to gather evidence, not the other way around.
Thoroughness Is Non-Negotiable Interview all relevant parties, review documentation, and follow the evidence where it leads—even if it’s uncomfortable. In the Moore case, had Michigan acted on earlier rumors or hotline reports with thorough investigation, they might have addressed the situation before it escalated to termination and criminal charges.
Impartiality Is Everything If the person accused is your top performer, your best friend, or a family member, you need outside help. Small businesses can’t afford to have investigations compromised by the appearance of bias.
Documentation Protects You Every step of your investigation should be documented: who you spoke with, what they said, what evidence you reviewed, and how you reached your conclusions.
Action Must Follow Findings The biggest mistake organizations make is conducting an investigation and then doing nothing with the results because the findings are inconvenient. If your investigation confirms policy violations, you must take appropriate action—regardless of the employee’s value to your organization.
The Real Cost of Doing Nothing
When you know about problematic situations but fail to act, you’re not avoiding problems—you’re multiplying them:
Legal Exposure Compounds Every day you delay addressing known issues, you’re potentially building evidence of negligence, creating hostile work environment claims, and increasing your exposure to retaliation claims when you finally do act.
Your Culture Takes the Hit When employees see problematic behavior tolerated, they learn that your policies are just words. Your best employees start questioning whether speaking up matters. Your workplace culture erodes from the inside out.
You Lose Good People Talented employees don’t stick around to watch rules apply differently to different people. They quietly update their resumes and take their skills elsewhere, leaving you with the very problems you were trying to avoid by not rocking the boat.
The Explosion Is Inevitable “Open secrets” don’t stay secret forever. They eventually explode—often at the worst possible moment, in the most public way, causing maximum damage to your business reputation and bottom line.
Practical Steps for Small Business Owners
Create Real Reporting Mechanisms
Your employees need multiple ways to raise concerns:
- Direct supervisor (when appropriate)
- HR or owner
- Anonymous hotline or email
- Written complaint process
Make sure everyone knows these options exist and how to use them.
Establish Investigation Protocols
Even small businesses need clear processes:
- Who conducts investigations?
- What’s the timeline?
- How do you document findings?
- When do you bring in outside help?
Having this framework before you need it makes responding to complaints faster and more effective.
Train Your Management Team
Your supervisors and managers need to understand:
- What constitutes a complaint (hint: it’s not just formal written grievances)
- Their obligation to report concerns up the chain
- How to avoid retaliation
- Why “handling it themselves” isn’t an option
Enforce Policies Consistently
This is where most small businesses fail. Your star performer gets the same consequences as everyone else. Your longest-tenured employee follows the same rules as the newest hire. Your family member adheres to the same policies as outside employees.
Consistency is your best legal defense and your strongest cultural statement.
Don’t Wait for “Proof”
If you’re hearing rumors, seeing patterns, or getting informal complaints about supervisory relationships or potential policy violations, investigate. You don’t need a smoking gun to justify looking into concerns—you need reasonable belief that something might be wrong.
The Michigan Lesson: Act Before You Have To
The University of Michigan waited until they had undeniable proof delivered directly by the affected employee. By then, the situation had evolved from a policy violation into a termination, criminal charges, and national headlines.
Your small business can’t afford to wait that long.
The question isn’t whether investigating uncomfortable situations is hard—it is. The question is whether it’s harder than explaining to a jury why you knew about a problem for months or years but did nothing until it became a legal disaster.
Moving Forward: From Checkbox Compliance to Real Accountability
Remember: Your true culture isn’t defined by the policies in your employee handbook. It’s defined by the worst behavior you’re willing to tolerate and how quickly you address it when you become aware of it.
Having reporting mechanisms means nothing if employees don’t trust you’ll actually use them. Having investigation procedures means nothing if you only deploy them when you have no other choice. Having workplace policies means nothing if they don’t apply to everyone equally.
The most expensive lawsuit is the one that happens because everyone knew there was a problem, but nobody with authority was willing to act on it.
What reporting mechanisms do you have in place? More importantly, when was the last time you tested whether employees actually trust them enough to use them?
Your answer to that second question matters far more than the first.
Disclaimer: This article discusses publicly reported information from the Sherrone Moore case at the University of Michigan. All individuals are entitled to due process, and criminal charges are allegations until proven in court. This blog post provides general information about employment law principles and does not constitute legal advice for any specific situation. For guidance on your particular circumstances, consult with a qualified employment attorney.
Having trouble figuring out whether your complaint procedures are actually working? That’s exactly what I help small businesses fix before they become headlines. Let’s talk about building reporting mechanisms that actually protect your business—not just check compliance boxes.
