When the rubber hits the road, how confident is your legal department in your employees’ understanding and ability to collect and preserve information, data, and correspondence related to high-stakes litigation?
Effective legal holds depend entirely upon the disruption of the day-to-day routines of creating, sharing, preserving, collecting, and destroying information, data, and correspondence between employees, contractors, vendors, and customers. Educating and training employees to understand the legal and financial stakes involved in effectively executing a legal hold is critical to what the courts are expecting, based upon multiple rulings over the past several years.
A recent survey of 300 corporate legal departments conducted by Thomson Reuters has revealed that only 29 percent of corporate legal professionals feel their employees understand the preservation obligation involved with legal holds, and just 37 percent of corporate legal professionals are confident that employees will follow through on legal hold acknowledgement.
The good news is that, according to the Thomson Reuters survey, 56 percent of legal professionals surveyed do educate employees about the legal hold preservation process. Despite these efforts, many legal departments continue to remain less than confident in the defensibility of their legal holds.
While the courts continue to warn legal professionals about poor legal hold processes, organizations that take reasonable steps to proactively establish a well-documented process, particularly in the area of preservation, stand a greater chance of success in the courtroom.
Because employee education and training are key to the success of this process, here are 10 suggestions that today’s corporate legal professionals should consider:
Having a legal hold process challenged in court is not a matter of “if,” but “when.” The consequences of which could have serious bottom-line effects on a corporation’s finances and reputation. General counsel should make educating executives about the importance of document preservation and collection a priority. Consider inviting an expert to offer a presentation to management on the value of establishing a sound legal hold process.
Building an effective legal hold process will require integration with IT, human resources, corporate communications, marketing, finance, R&D, and other departments throughout the organization. Establish an interdisciplinary team to create and maintain policies about the preservation and destruction of documents, images, data, and other information.
With the enormous amount of information and data generated, shared, and stored electronically, it’s critical for the legal department to integrate legal hold compliance with the organization’s IT function. For example, IT should set the standards and procedures for automatic email retention and deletion, and IT needs to be at the table to determine how to back up sensitive electronic records related to litigation in the broader context of an organization’s disaster recovery efforts.
While legal hold standards continue to evolve, one thing is clear: the courts favor a proactive, consistent, broadly understood process that demonstrates good faith toward meeting the preservation obligation. Consider adding a training component to new employee orientation and conducting an annual seminar about legal holds, ethics, and compliance for existing employees. In addition, consider adding e-learning opportunities to reach more employees through the convenience of their desktop or mobile computing devices.
Include a section about legal holds in your organization’s employee handbook. Be sure to clearly define what information and data to preserve, as well as instructions for avoiding inadvertent destruction or alteration of information, data, and correspondence (including deleting emails, text messages, and social media posts). Require employees’ signatures to acknowledge understanding about the legal hold policies.
The legal department should work with the marketing department to create posters for employee break rooms or lunchrooms, and banner ads and stories for the organization’s newsletter or intranet to help explain legal holds to employees. Provide how-to, step-by-step instructions on information and data preservation, and consider making a how-to video that can be shared with employees via email.
Many organizations will periodically have days where employees are encouraged to clean up their workspaces and files, and throw away or store old documents. Include electronic records as part of Cleanup Day, with an educational email that reminds employees about the importance of preserving certain types of information. Provide instructions to employees about where they should transfer sensitive or relevant documents and email messages sitting on their computing devices into designated locations on the organization’s server. Use this opportunity to state the organization’s policies on creating and storing documents on company-provided computing and mobile devices versus personal devices.
Conduct an annual audit to measure compliance with legal holds, and to identify gaps where further training may be necessary. Include feedback mechanisms in the audit, ranging from recorded interviews with information custodians to auditing actual behavior. Employees who are not complying with legal holds should be recommended for an escalated conversation with the employee’s manager, and potential disciplinary action.
As part of the auditing process, conduct an online survey to measure employee awareness and understanding of your organization’s legal hold process.
Establish a process with human resources and IT to address legal hold issues associated with departing employees who may be custodians of information involving a current litigation hold. For company-owned equipment, alert IT about not wiping clean the data stored on a departing employee’s equipment. Take special care in addressing departing employees who may have information stored on employee-owned laptops, tablets, or smartphones.
At the rate in which information is created and shared in today’s digital world, making the investment to inform, educate and train employees about legal holds makes bottom line sense. In our litigious times, employees need to understand the consequences of preserving sensitive information, which may have a bearing on pending litigation. Bringing together a robust, proactive education and training program with automation technology is a powerful one-two combination that will reduce risks and increase the confidence of legal counsel in defending the legal hold process in court.
Reprinted with permission from the Association of Corporate Counsel 2015 All Rights Reserved