Employers are expected to retain information that may be linked to an ongoing or upcoming litigation. Ignoring this duty could lead to major legal problems down the road that no employer wants to face as it may lead to financial ruin. This is the reason why a business that has received a lawsuit notice, administrative charge, or has been informed of an investigation needs to start the process of a litigation hold. The following will help answer some of the questions you might have about this kind of hold.
Explaining the Litigation Hold
Litigation holds are a set of instructions that boil down to the search and preservation of paperwork that may be necessary for an upcoming legal struggle or investigation. The hold also instructs employees to avoid paperwork destruction or any type of modification, which may seem like tampering with potential evidence or obstructing an investigation. Of course, document shredding companies should have an option to pause routine document destruction for the time being.
When Does a Company’s Duty to Protect Information Begin?
The US courts usually agree that the employer’s duty to this legal system starts the moment the employer has enough knowledge to anticipate some type of litigation or investigation. This duty could be traced back to regulations, statutes, or common law though this does depend on the state and jurisdiction of the business. As a rule of thumb, any employer who believes there is a possibility of litigation or investigation should observe this duty just in case. It is wiser to be safe than sorry in these matters.
Who Should be Responsible for the Litigation Hold?
For the most part, the Director of Information Technology normally deals with this hold though that is not always the case. Sometimes, when the title is absent, the person that is in charge ends up being the person who deals with data storage or the person that deals with technology issues. Furthermore, employees who hold relevant information should receive this hold notice as soon as possible, like HR employees or supervisors just to name a few.
What Kind of Information Needs to be Saved?
There is no clear answer to this question because it depends on the ongoing investigation or litigation. The key is to preserve anything that seems remotely related. It is also important to recognize that you have to go through a number of sources to gather information, meaning that collecting data is going to require patience. HR records, emails, text messages, social media accounts, calender entries, and even voice mails can all be considered evidence and must be reviewed. This means that information from laptops, computers, smartphones, hard drives, and tablets will be required.
Steps Taken After Initiating the Hold
The first thing is to follow up with all those who received the noticed and see the steps taken to implement the instructions of the hold. Checking to see if the hold is still honored periodically is vital, which means that a leader in the company needs to be in charge of this task. It is important that employers evaluate the need to pass the litigation hold instruction to other members of the staff to make sure that all information is reviewed before it is discarded.
How is the Document Retention Policy Affected?
This policy needs to be suspended. Many employees have gotten used to the archive and deletion routine implemented by this policy, making it easy for one of them to make a mistake. It is important to remind every employee that this policy is suspended for the time being since emails and documents could be important to the litigation or investigation the company is linked to.
Consequences of Failing to Protect Information
The courts have the power to sanction a non-compliant employer or tell the jury that it has the power to draw an adverse inference against the company in question. Fees, fines, and other forms of punishment are not out of the spectrum of possibilities.