Karen McAndrew, Robert McKearin, Editors
Dinse, Knapp & McAndrew, P.C.

Vol. 12, No. 3
May 2007

LITIGATION

What does HR need to know about e-discovery?

by Robert McKearin

Want the short answer? A lot. Effective December 1, 2006, federal courts adopted a comprehensive set of rules governing the discovery of electronically generated information in all federal civil litigation. The new rules are already having a profound effect on the discovery of electronic information in litigation, and they should affect how businesses — and especially HR departments — handle electronic communications and data creation and retention. By the time the lawyers get a case to the litigation stage, the die is cast, and everything that's requested must be dredged up and produced. Consequently, it's important to plan ahead and develop practices that will take the fear and dread out of electronic records discovery, or e- discovery.

What's discovery?

The first question for the uninitiated is, what's discovery? If you're unlucky enough to have been involved in a lawsuit, you know all too well that "discovery" is the part of the case that runs from when the claims are filed until the trial, months or years down the road. It's the time when everyone who's part of the lawsuit gets to ask questions, request documents, and take depositions to "discover" what type of information the other side has. E-discovery applies to everything that's on a computer system, from e-mails to correspondence to files and spreadsheets. It also includes voice-mail and text messages — in short, anything stored electronically.

The discovery process can be boring, nerve-racking, and insomnia-inducing, and it's always costly in terms of time and money. Discovery is a part of virtually all lawsuits: While only five to 10 percent of cases go to trial, more than 98 percent go through the discovery process (the other 2% are dismissed or dropped early on). As a consequence, the new federal rules have a truly pervasive impact.

HR needs to be involved in shaping company policies, procedures, and practices for creating, storing, and retaining electronic information. And it's very important to have your procedures in place before a lawsuit is filed or even threatened. Your policy will determine what exists — and therefore what has to be turned over to your opponent when a claim is filed.

Things to consider

Here are some points to remember about e-discovery.

• "Delete" doesn't mean something is gone forever. Forget the word's dictionary definition. Delete really means, "Put this information in an encrypted form that only a highly skilled (and highly paid) individual can understand and then put it somewhere in my computer hard drive or mainframe where only that highly skilled (and highly paid) person can find it." In other words, don't count on your delete key to do anything except clear your screen or, if you subscribe to Murphy's law, lose an important document you're working on. That e-mail you wish you hadn't sent and the incriminating and inaccurate draft of a memo about someone's termination will survive, no matter how many times or how hard you press the delete key.
• Meet with your IT person to find out what your system's protocols for record retention are. Make sure you're speaking the same language so you understand each other. Discuss options for preserving and destroying documents.
• Put your record-retention policy in writing and date it. If an employee's attorney later claims that you destroyed a document that should have been preserved, you'll be able to point to a bona fide policy that justifies your decision to get rid of the record.
• Consider shortening the time during which "deleted" items are saved in your system. You should retain information no longer than appropriate for your type of business. Certain laws establish a minimum amount of time that HR must retain employment-related documents. You have more flexibility to substantially shorten your retention period for e-mails, drafts of correspondence, and drafts of contracts or other important documents. Some voice-mail or e-mail systems automatically delete messages after a fixed amount of time. Find out from IT how long your system retains information and how thoroughly it's deleted.
• Be prepared to override your retention policy to preserve all relevant e- mails, data, and other electronically stored information as soon as litigation becomes probable. There are serious sanctions for destroying documents after you become aware of a lawsuit. If litigation truly arrives out of the blue, you must begin preserving electronic information when you first learn about the claims — e.g., when it's served on you. On the other hand, if a terminated employee accuses you of age discrimination as he's walking out the door and mumbles something about seeing his lawyer, that's when you have to begin preserving information, even if he doesn't sue you until months or years later.
• The preservation requirement applies to everything that exists on the date the duty to preserve information is triggered, not just to documents created after that date.
• Finally, you must educate your employees. Warn them about the ineffectiveness of the delete key, inform them that all document drafts and electronically stored information are subject to discovery if a lawsuit is filed, and tell them about your obligation to preserve records once litigation is probable. Of course, they also must understand the importance of maintaining professionalism anytime they create electronically stored information.

Copyright 2007 M. Lee Smith Publishers LLC

VERMONT EMPLOYMENT LAW LETTER does not attempt to offer solutions to specific problems, but rather to provide information about current developments in Vermont and federal employment law. Inquiries about specific problems should be addressed to the labor or employment law attorney of your choice. Vermont does not certify lawyers as specialists in labor and employment law or other areas of concentration.