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The Dangers of Prolonged Record Retention
Discarding records too early – particularly during the period a record is required to be kept under applicable laws – can expose an organization to liability. Due to uncertainty regarding how long is long enough, an organization may try to err on the side of caution and keep data indefinitely. However, this approach overlooks the dangers of keeping records too long. The State of Michigan itself has recognized the dangers of this approach, noting that, "if records are kept too long, they can waste valuable storage space, and they can become a liability" if the entity becomes involved in litigation. [1]
1. Costs of Retention
The most obvious cost of retaining large amounts of data for long periods of time is the cost of storage itself. Experts estimate that it costs an organization approximately $4 per year to store a single box of paper records and $2 to $20 per year to store each gigabyte of electronic data. [2] While electronic data prices are declining, the rate of data production is increasing at a much greater rate, [3] resulting in an ever-increasing net cost of record storage.
2. Costs of Discovery
Not only does limiting the amount of data stored by an organization reduce day-to-day storage costs, it also reduces the cost of locating records, particularly in the event of litigation. As discussed below, a discovery request may require a company to locate any records in their possession or their employees' possession that addresses a given issue. Searching old and voluminous records to identify documents to be produced can be extremely expensive and time consuming. The average cost incurred by a company in connection with the discovery of electronic data ranges from $1 million to $3 million per terabyte of data. A reduction in the amount of stored data can significantly decrease these costs. [4]
3. Potential Liability in Litigation
When served with a discovery request in connection with litigation, a party must produce all documents in its position that are responsive to that request, even documents far longer than legal or business considerations require. An organization that maintains records in this manner has effectively paid storage costs for a trove of potentially-damaging evidence that it will be required to produce to the opposing party.
Additionally, once litigation has commenced, an organization may not destroy any records potentially relevant to the litigation, and will face serious penalties if it does so. Therefore, it is wise for a company to dispose of outdated records on a routine basis under a well-defined policy. Destruction of records in accordance with a written policy eliminates potentially harmful evidence from an organization's files, provides a defense to claims that the organization destroyed the records to conceal evidence and reduces the likelihood that the organization will inadvertently fail to produce relevant documents.
[2] Matthew Scott, "New rules for data retention," Corporate Secretary (Sept. 27, 2012), available at http://www.corporatesecretary.com/articles/ediscovery-and-records-management/12336/new-rules-data-retention/.
[3] Id.
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Programs Update
Happy Spring from the Programs crew! We are excited to bring a wonderful lineup of speakers for our annual Spring Seminar on April 17th at Amway Headquarters. The topics of RIM education, privacy law, SharePoint, and general RIM legal concerns continue to be relevant areas of interest to our members. We hope you are able to make the event as well and feel free to bring a colleague!
On May 13th our chapter is hosting the annual Michigan Tri-Chapter event in Lansing. We have Dan Lohrmann the Chief Information Security Officer for the State of Michigan and Dawn Ward from Warner Norcross and Judd as expert speakers, and we will be doing a special breakout session.
Our final meeting of the year on June 5th will be held at the Holland Board of Public Works. The presentation will be on risk and privacy matters from a technology perspective.
Stay connected and check for meeting information on our website westmiarma.org, on Twitter @ARMAWestMI, LinkedIn, or Facebook!
Andrew Ysasi, MSA, CRM, IGP, PMP, CIPP/US
VP Programs - Western Michigan ARMA Chapter |
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 New member, Dana Potocki, Payroll & Records Coordinator, Wolverine Power Supply
I grew up in Montana and moved to Michigan 17 years ago after meeting my husband online (back when getting online took a half hour!). We lived downstate in the Chelsea, Michigan area until 2004 when my husband took a transfer to Northern Michigan for his job.
My entire life, I have been in some form of the business world. A year before my youngest daughter was born, we made the decision for me to come home (that has been 13 years ago now!). Raising my girls and taking care of my family has always been my first priority, and at the same time, I knew I would one day return to the workforce outside of the home. So, while I was home raising my kids, I made sure to stay active and keep my skills up to speed. I did business management and accounting for a few clients from home, and I also picked up skills in website design and online marketing along the way, too.
This past fall when my girls started school (10th & 6th grade) I knew it was time to venture back to the traditional workforce. I am currently the Payroll & Records Coordinator at Wolverine Power Co-op in Cadillac, Michigan and I couldn’t be more thrilled. I coordinate all of the records data as well as all of the payroll processes.
I’ll be honest – records management has changed greatly in the past 15 years! It is incredible the amount of data that we as Record Managers have to handle, but more than that, all of the details we have to maintain to stay compliant and within recognized guidelines.
I joined ARMA because my predecessor couldn’t stress enough what a benefit it would be to me in learning my way around records management. I look forward to becoming more involved with the ARMA organization.
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 New member, Randy Messick, Account Executive, HP Software - Autonomy
An Interview with Randy Messick:
Where are you from? I have a background in computer engineering, beginning with electronic storage systems. Over time, my interest grew into the actual information on those systems rather than just the bits and bytes. Today, I have an intense interest in Information Governance and the business benefits that can be achieved with it doing it right.
Where do you currently work? What are your primary responsibilities, highlights, and major successes in your current position? As an account executive, I represent HP’s Information Governance solutions for both commercial and government clients in Michigan. Every time a client saves money by quickly sorting through information, avoids a regulatory fine or sanction through governance, or avoids a lawsuit I consider it a major success.
What do you plan to gain from your ARMA membership, and what led you to join ARMA? I hope to gain more forward thinking on IG rather than reactionary. I know ARMA is a good place to gain that.
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