Reminder: Dust Off Those Records Retention Policies and Do Some Spring Cleaning

It is that season again – time for spring cleaning!  Before you start purging your cabinets, drawers, emails, and files, you should review your company’s Records Retention Policy.  Don’t have one of those?  Well, now’s a good time – before the purge – to establish the guidelines for retaining, organizing, and discarding the company’s records and other data.

Developing a Records Retention Policy

When developing an effective Records Retention Policy it is important to engage your company’s information technology, compliance/risk, legal, and business departments to understand the types of records your company creates and receives.  Involving these different departments also allows all involved parties to provide input on the structure, process, and implementation of the policy.  A Records Retention Policy will provide a company’s employees with guidelines to follow for identifying, retaining, managing, and disposing of records.

Once the types of company records have been identified, they will need to be categorized and assigned a retention period.  Careful categorization of records will make it easier for employees to identify the types of records they use and possess.  The policy should address all of your company’s record mediums – for example, paper files, electronic files, e-mails, voicemails, and personal devices (such as personal laptops, phones, etc.).  A retention period will be designated for each record based on the type of record and the information it contains.  A retention period is the amount of time that a particular type of record needs to be kept – this time period could range from just while a record is active to permanent retention.  Retention periods vary depending on federal, state, local, and other (such as industry) laws and regulations, obligations imposed by the “record,” statutes of limitation, and business operations.  Generally speaking, once a record’s retention period has passed, it can be destroyed in accordance with your company’s destruction procedure.

The Litigation Hold – Exception to Scheduled Record Destruction

However, there are situations in which records should not be destroyed even though the retention period has passed.  Litigation (or document) holds are issued in connection with anticipated or pending litigation or claims and impose a “hold” on the destruction of potentially relevant information contained in the company’s records.  This “hold” on record destruction is designed to preserve the records for discovery in connection with a legal proceeding.

The Follow Through – Implementation and Periodic Review

Developing a Records Retention Policy is only the first step – it is essential that the policy is properly implemented and followed by the company’s employees.  This next step involves employee training on the Records Retention Policy, which ideally would be part of a company’s larger compliance training program.  See our blog article on the importance of compliance training programs – Small Businesses Need Compliance Training Programs, Too.

For proper implementation, it will be important to schedule periodic “clean-up” days with appropriate team members (always including someone from the IT Department) to review paper and electronic records and decide which records should be discarded, and how.  Information privacy is a hot topic – so it is imperative that your company disposes of all potentially sensitive records in a secure manner.  The company’s IT Department may take the lead on the disposal of electronic records, but it is equally important that paper records be disposed of appropriately.  This may require shredding documents internally or hiring a third party vendor to securely destroy sensitive documents.

Some employees will welcome the opportunity to clean out their work areas. Others may liken the task to undergoing a root canal.  If employees understand the benefits and if the company creates a fun atmosphere, the spring “cleaning” process is more likely to be a success.  Here are a few ideas to motivate employees on a “clean-up” day:

  • promote as a team-building activity using a special theme
  • allow casual dress
  • provide lunch
  • give participants small promotional items like pens, mugs, or tote bags
  • hold a contest for prizes like gift cards

With spring now upon us (finally!), this may be a good time to implement a new Records Retention Policy or to review your company’s current policy and update it as necessary to address any legal or business changes.  Then start your spring cleaning!

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