LL&D Law
Document Retention Issues When Terminating An Employee

by Courtney D. Powell
5/11/2010 7:25:00 AM

     If you think there may be litigation, it is imperative that you contact an attorney before making any decisions. But in the meantime, the quick answer to your question is, “probably not.” As a general rule, you should not destroy documents, either by shredding or deleting, if you think litigation may occur.

     Any business has a duty to preserve evidence, including electronic evidence, whenever it is engaged in litigation or reasonably believes litigation will follow. Included in this duty is a requirement to identify, locate and maintain documents and information that may relate to the litigation. This is called instituting a “litigation hold.” If a business fails to preserve the information, there can be serious repercussions, including a decision in favor of the opposing party.

     Unfortunately, there is no bright line rule for what types of documents must be retained when the duty to preserve arises. However, there are general guidelines. Typically, an organization is required to preserve evidence that it knows or should reasonably know is relevant to the potential litigation, is reasonably calculated to lead to the discovery of admissible evidence, is likely to be requested during the litigation or is the subject of pending discovery requests.

     E-mail and electronic information create new issues that the law and attorneys are learning to address. Clearly, e-mail and other electronic information are pivotal in today’s corporate climate. The recent lawsuit filed against Goldman Sachs is based, at least in part, on e-mails a Goldman Sachs bond trader wrote to his girlfriend. Unlike a letter an employee receives at his work address, an e-mail sent from an employer’s computer never leaves the workplace.

     So, does this mean that the now-terminated employee’s files can never be used and all of his e-mails must be maintained? To a certain degree, yes. Computer files and e-mails, even if deleted, are usually still recoverable from a computer or computer system. Depending on the type of computer network your business has, you will need to determine the best way to preserve the ex-employee’s electronic files. Often, making an exact duplicate, also known as a clone, will protect the integrity of the electronic files. The same steps should be taken to preserve the information of other employees who may have information relating to the possible litigation.


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