Please enjoy this blog post co-authored by Barbara Dalton, Director of Information Governance, Honigman LLP, Leigh Isaacs, Director, Information Governance, DLA Piper and Carol Volle, Director of Information Governance, Taft Stettinius & Hollister LLP.
So, you’ve updated your practice area retention schedules and are feeling pretty good about your disposition program. You’ve identified the retention periods for your client files, defined matter close dates as your retention triggers, but what about those pesky administrative departments such as Marketing, Recruiting, Accounting, HR that produce loads of records and typically have a significant backlog of files that can be destroyed because, let’s face it, your predecessors were likely to view administrative disposition as very low on their priorities and in some cases your administrative teams were managing their own destruction with no written schedule or formal process in place.
As with any disposition program, it can be difficult to know where to start. How do you incorporate the administrative functions into your retention schedule and identify candidates for destruction?
Establish Administrative Schedules
First and foremost, the framework of a disposition program includes current retention schedules and a robust process for managing disposition, including accounting for any content impacted by an active Litigation Hold. Without those elements, your program cannot be considered defensible; thus, establishing retention schedules for administrative functions is critical to a successful program.
Work with your administrative teams to understand what operational, regulatory, financial, historic necessities dictate what they do with their content, how it is stored and how long they need it. They will often know the rules impacting their business and can make your job one of citation and verification. They also have the intimate knowledge as to legacy file keeping and organization practices that can provide insights into the way they have worked. This can not only be helpful in addressing legacy file disposition, but also mapping out your go-forward program.
Establish Administrative Disposition Processes
Why is it problematic for law firms to establish retention schedules for their business records? And how can we ensure administrative schedules comply with ever-changing regulations and privacy considerations? To start with, let’s look at trigger dates. In a law firm setting, the trigger that starts the client-matter retention clock ticking is the matter close date. Once a matter is closed, retention is calculated for a prescribed period of time (5, 7, 10, etc. years, or whatever you/your management team has determined is appropriate based on regulation, your firm’s risk tolerance, etc.). There are, of course, exceptions to this for certain practice areas, such as Estate Planning, where most matters generally remain open until the client passes away, and then may be retained for a significant period of time. However, for the majority of practice areas, the matter close date serves as the retention trigger.
This approach is standard and effective for practice area files, but what’s the trigger for administrative records? These matters don’t technically close, so how can retention be applied? One approach in a matter-centric environment is to create Administrative Matters on an annual basis. In this scenario, an administrative department might create a fresh set of workspaces based on administrative activity or document class effective January 1 of each year, so it may look something like this:
Partnership Agreements - 2022
Recruiting Information – Staff – Not Hired 2022
Recruiting Information – Attorneys – Hired 2022
Accounts Receivable 2022
Accounts Receivable 2023
Under this scenario, each workspace has a specific date range of January 1 – December 31 of the calendar year. At the end of each year, the matters can be closed (and potentially archived to prevent new records from being created in a closed workspace) which starts the retention clock. In another 5, 7, 10, etc. years (whatever period is relevant to the record type/category), the matter will have satisfied its period of keeping requirement and be eligible for destruction. This approach requires oversight and communication to ensure all employees know to use the new Administrative Matters each year, but it is also a very effective way to manage retention by identifying a trigger to initiate start the retention clock.
Things to Consider
Once you determine you approach, there are a few caveats to consider as part of your administrative retention program:
- Consider starting with “lower risk” admin files, such as IT and Marketing. Departments like HR and Accounting are subject to more regulatory requirements, and thus may have more risk associated with them.
- Your internal Library/Knowledge Management team is a great resource to help research/validate retention requirements. They are your partner, so take advantage of this in-house resource.
- Create a citation matrix for each administrative department. List specific citations for the regulatory requirements so they can be reviewed and updated annually.
- In addition to retention requirements (how long do we need to keep this), be sure to include destruction requirements (when must we destroy this) on your schedule and citation matrix. Of particular note, privacy laws are rapidly changing, and the mandated destruction period may be significantly earlier than the retention requirement.
- Understand there is a difference between disposition process for administrative records vs. practice area records. Administrative records aren’t subject to the same ethical obligations for client consent, because the firm is essentially the client. If senior management has approved the retention schedule, you may be able to proceed without further authorizations from the administrative department. This should be vetted with your firm’s leadership and/or Office of General Counsel when you develop your program. However, you should ensure you are checking for any need to preserve records due to litigation hold.
- Determine where the “official record” is located. For many firms, administrative departments used to operate in a de-centralized manner (e.g., local office kept the official employee file instead of a centralized department). Identify who might have copies and account for both the record and the non-record in your schedule.
- Administrative records can be challenging due to firm realignments (or mergers, acquisitions, divestitures, etc.) over the years. Be mindful of this and seek out people who may have historical information regarding these changes.
- The same requirements of confidentiality apply to both administrative and client information.
- Understand the history of how administrative numbers were established over the years. It may not be consistent from year to year, and it could have changed over time. Gather as much history as possible to understand your collection and how it is arranged.
- Law firms are businesses, and their administrative records are no different than the corporate records of an organization. Administrative records are subject to laws, regulations, etc. whereas practice area records are not.
- Review your records with an eye towards identifying and possibly retaining historical records (for example a copy of a lease from the firm’s very first office building).
- Understand what systems your administrative departments use, what data is contained within them, and how they are organized.
Be aware that certain firm data could be maintained by 3rd parties, either through their on-premise servers or in the cloud. Those situations need to be identified and documented on your retention schedule, and you need agreements in place with your vendors to ensure retention and destruction meets your requirements. An additional challenge, for sure, but an important consideration when using 3rd party providers.
Establishing a retention and disposition program for your administrative records doesn’t have to be daunting. Similar to addressing client/matter files, remember that any attempts to boil the ocean can be overwhelming and result in paralysis. The key is to find a place to start and continue to build. ILTA is a great source for articles, white papers, and webinars that address retention scheduling, as is ARMA international. Resources for your consideration are listed below.
Building a Retention Schedule From Scratch 5-part webinar series, ARMA International (available only to ARMA members)
Compliance, Retention, and Destruction: Parts 1-2, ILTA recorded webinar
Automate Retention Policies to Reduce Manual Processes and Improve Compliance, ILTACON 2022 recorded session#InformationGovernanceorCompliance#Security#Retention#Firm#ProfessionalDevelopment