Ten Tips for Establishing a Compliant Records Retention Program

Corporate America has historically underestimated the value and necessity of having a sound and compliant records retention program. In this age of Sarbanes-Oxley, neglecting your company's records retention practices is no longer an option. Developing a program that contains the following characteristics is crucial and helps to produce a compliant and legally-credible, corporate-wide records retention program.

Characteristic #1 - The retention schedule reflects the current state of the company. Records policies must be updated to remain current with organizational, operational, and technological changes.

Characteristic #2 - The retention schedule is based on legal and regulatory requirements; citations support the retention periods. If your company's retention schedule is based on arbitrary factors and not legal requirements, it is easier for opposing counsel to argue that employees engage in "selective destruction", which can lead to serious awards for legal damage.

Characteristic #3 - The retention schedule is up-to-date and reflects current law. Laws change. Since retention policies must be grounded in the law, maintenance of the policies is necessary to keep pace with legislative and regulatory changes.

Characteristic #4 - The program employs formal policies and procedures that are consistent across departments. Records management policies need to be clearly and consistently documented across all divisions and departments in order to support your company's actions.

Characteristic #5 - All records and all media are covered in the records management program. Records come in all forms of media. It is a common mistake to exclude electronic records and e-mail in records retention programs. These records are subject to the same legal requirements as paper and are discoverable in a court of law.

Characteristic #6 - The program has one specific individual within the organization who administers the company records management program. A manager should be specifically designated as the person responsible for overseeing the records management function.

Characteristic #7 - Retention policies are integrated into a records management system that can alert a company when it is time for records to be destroyed. Even the most credible policy will not assure that records are consistently destroyed. Companies need a system to remind employees when records are eligible for destruction.

Characteristic #8 - The company's employees are aware of the company's records policies. Many companies squander their investment in a records retention program by failing to roll out the program to users. Implementation and enforcement of records management policies is key.

Characteristic #9 - The company employs an effective review or audit process for approving records destruction. The old saying "inspect what you expect" applies to records retention policies to ensure consistent use.

Characteristic #10 - The records management system allows the company to identify and "hold" records that are pertinent to a pending litigation, investigation, or audit. Many companies halt the disposition of all records that are scheduled during a pending litigation because they have limited faith in their records management system's ability to enable them to identify the specific records that are potentially relevant to litigation, investigation or audit.

In sum, treat your company's records retention policy the same way you treat your company's other programs. Make sure it is championed, developed, packaged, rolled out, and audited.