We recently completed a record destruction activity that over-ran budget by 500% and time estimates by 700%! The reason? Poor planning for destruction while initially storing the records. It is often easier to not plan for destruction of documents. Administrative systems in India are often unreliable, and we end up questioning our intent to destroy.
- What if auditors demand a 10-year old file and we don’t have it?
- Why should we spend time on figuring out how to destroy documents, when chances are we will require the documents eventually?
- Who will put their neck on the line and take the decision to actually destroy the documents when the time comes?
- There are so many documents in my warehouse, how can I be sure I am not destroying anything important?
There are several reasons to destroy expired records. The more important ones are:
- India has laws around how long records should be maintained. There is absolutely no reason to keep records longer than this statutory period. Refer to this blog post for information around retention-period of records.
- Keeping expired records exposes you to litigation. If you have destroyed an expired record, in the event of litigation you can plausibly say that you destroyed the record because it was past its statutory retention period. If you haven’t destroyed the record, you will be legally obliged to produce it in discovery.
- There is a cost to storing old physical records. Physical files take up valuable warehouse real-estate. You can easily put a rupee-figure on this space. It is often a very high figure, especially in large crowded metropolitan cities.
- There is a cost to storing old digital records. Whether you store your digital documents on a 3rd party’s cloud or on your company’s servers, there is always an associated cost. Maintaining servers is costly. Space on the cloud, though it’s getting cheaper every year, still has an actual rupee cost attached to it.
- There is a cost to managing old records and documents. If you do end up needing to retrieve an old document or file, you can end up wasting days or even weeks of labour trying to find the right document. This retrieval is often performed by someone from your Accounts, HR or Legal teams – someone most likely getting paid a high salary.
The customer we worked with had records dating back 14 years, while the statutory requirement is only 7 years. We mutually agreed that destroying records older than 7 years was the right way forward. The customer had not spent any time planning for destruction. As a result, we faced the following challenges when we tried to destroy old files:
- Separating expired files from current files turned into a highly time consuming task
- Creating a database of nearly 3000 expired files was cumbersome, but necessary, since it is crucial to know which files are being destroyed
- We couldn’t make a good estimate of time and resources needed to do the actual shredding, because we didn’t know upfront how many files we would need to destroy
In the end, the destruction activity over-ran budget by 500% and time-estimates by 700%.
So, how does one plan properly for destruction of records?
- Agree upon a record retention policy in consultation with affected department heads and legal when embarking upon a records management program. This should not be difficult as there are legal requirements around retention of crucial company records, which need to be adhered to.
- Document the retention period for each record type. The records retention policy should explicitly list each type of record that will be kept in storage, together with the exact number of years that record should be stored for. This should be signed-off by the company CEO, MD, General Counsel / Attorney and relevant department heads.
- Define record destruction date for each physical record. Your physical records management system should be able to record the actual destruction date based on the retention period for each file that is indexed.
- Define record destruction sign-off authority for each physical record. Your physical records management system should be able to record the job title of the person responsible for signing-off on destruction of a record when the destruction date approaches. A backup job-title should also be listed, in case the primary authority is not available.
- Define record date and authority on digital documents. Similar to the physical records, each digital document stored in the document management system should be tagged with the destruction date and sign-off authorities (including backup authority).
- Automate destruction alerts. A good records management system and digital document management system will have automated workflows that will send alerts to the sign-off authorities whenever a document/record needs approval for destruction.
These 6 simple steps will ensure that destruction is smooth and only the correct documents are ever destroyed. A little hard work earlier on, saves a lot of heartache later.