Developing a Records Retention Schedule The Basics & A Case Study Debra Robinson, CRM October16,...

Developing a Records Retention Schedule

The Basics

&

A Case Study

Debra Robinson, CRMOctober16, 2003

The Basics

Why do organizations need a Retention Schedule? – To identify the organizations “Official Policy” for

retention and disposal of information assets– To achieve economic benefits– To achieve legal benefits

The Basics - What

A retention schedule states the length of time that records must be retained and is based on the idea that all records have a “life cycle”

The Life Cycle is the useful span of time that a records should be retained

Remember…the Records Retention Schedule is only one component of an organization’s records management program

Retention Schedule The Development Process

Obtain Management Support Assign Primary Responsibility Include Other Participants Conduct a Records Inventory Classify Records to “Records Series”

Retention Schedule The Development Process, cont.

Conduct Legal Research Determine the Retention Values Design and Prepare the Retention Schedule Distribute for Review and Approval Publish, Communicate and Implement Take Steps to Ensure Ongoing Success

Management Support

Success is dependent on the amount of support received from the top– When the initial push comes from the top, this

support already exists and can be harnessed to obtain the resources needed

– When initiated by records management, the benefits may need to be “sold” to those at the top

Assign Responsibility

The Records Manager Use of Existing Personnel Consultants

Include Other Participants

Establish a team comprised of representatives from major functions/departments in the organization– Legal, Internal Auditing, Finance, Tax, Human

Resources, Regulatory, etc.

Team members should be knowledgeable of the records and their operational needs as used by their function

The Records Inventory

Consider a preliminary file purge Survey the organization’s records to obtain a

complete and accurate account Survey ALL media types Document the inventory on a form designed

specifically to facilitate obtaining and organizing the information needed

Interview department contacts

Classify Records to Records Series

Use the Records Inventory to group related records into Records Series or Classification Subjects for evaluation of retention requirements

Legal Research

There are over 4,700 federal statutes and tens of thousands of state statutes

Some statues are applicable to businesses or governmental agencies in general

Most requirements apply to specific classes of records maintained by certain types of business engaged in providing specific types of products or services

Legal Research – Planning

Consult with your organization’s legal council to discuss the scope of research required

Statutes applicable to most organizations include ones related to:– Business Incorporation– Labor and employment practices– Tax administration

Legal Research – Planning

Other areas of research to consider:– Products or services performed that may be

subject to recordkeeping requirements– Geographic locations of business activities– What federal, state or other government agencies

regulate activities of the organization– Litigation history of the organization and related

concerns

Legal Research - Issues

The following are the types of results that may be found in the legal research process– No recordkeeping requirement is found– A requirement is found requiring a specific

retention period– A requirement is found containing a requirement

to “maintain” the record with no specific time period identified

Legal Research - Issues

– A statute of limitation is found– A limitation of assessment period is found– Case Law

Many requirements are vague and difficult to interpret

Two or more requirements are found with different retention requirements

Legal Research - Sources

Researching Federal Requirements– Laws and regulations are contained in the United

States Code, United States Code Annotated or United States Code Service, Lawyer’s Edition

– Regulations are contained in the Code of Federal Regulations and the Federal Register

– Office of the Federal Register’s Guide to Retention Requirements

Legal Research - Sources

Federal Requirements On-line– http://www.washlaw.edu/searchlaw.html#Federal%20Statutes– http://www.gpoaccess.gov/nara/index.html– http://uscode.house.gov/usc.htm– http://cfr.law.cornell.edu/cfr/

Some Suggested Search Terms– Records– Recordkeeping– Limitations of Action– Maintain– Keep

Legal Research - Sources

Researching California Requirements– California Code of Regulations– 29 Codes Covering Various Areas

Contact State Agencies for Copies of Rules and Regulations

Legal Research - Sources

California Requirements On-line– http://www.leginfo.ca.gov/– http://california.lp.findlaw.com– http://www.netlawlibraries.com/

California Municipal and County Codes and Ordinances

– http://california.lp.findlaw.com/ca01_codes/municode.html

Use the Same Search Terms as for Federal Research

Legal Research - Sources

Other Sources for Retention Requirements:– Legal Requirements for Business Records: The

Electronic Edition, Edited by Donald S. Skupsky, JD, CRM; Information Requirements Clearinghouse

http://www.irch.com

– Retention 6.1, Zasio Enterprises

http://www.zasio.com/

– Guide to Professional Resources – ARMA International

http://www.arma.org/bookstore/default.cfm

Legal Research - Documentation

Reproduce the Full Text of all legal requirements

Note the applicable statue or regulatory citation(s) for each records series or classification

Determine the Retention Values

Determine Records Values– Operational/Administrative– Legal– Fiscal/Tax– Historical

Records Appraisal– Primary Value – Secondary Value

Determine the Retention Values

Cost/Benefit Considerations

Note: Don’t assume that because a person has stated that there is a specific requirement for retention that it must be so. Obtain justification.

Make Retention Decisions

Determine the Retention Values

Optimum Distribution of Retention Periods

RETENTION

RANGE

% OF TOTAL RECORDS

Less than 1 year 2-5

1 to 3 years 10-20

4 to 5 years 20-30

6 to 7 years 20-30

8 to 10 years 10-20

11 to 20 years 5-10

Indefinite 2-5

Design and Prepare the Retention Schedule

Determine the Retention Schedule Format– Description of Record– Department Owner– Retention Period

Active Period (Maintained within the Department) Inactive Storage Total Retention Period

– Media– Vital Records Identification

Distribute for Review and Approval

Final Draft Reviewed and Approved by the Retention Schedule Development Team

Reviewed by the Legal Department Route for Approval to Managers and

Executives in Key Positions within the Organization

Maintain Records of the Approval

Publish, Communicate and Implement

Utilize the Organization’s Normal Process for Publishing the Retention Schedule as Would Occur for Other Important Policies

Develop a Communication Plan to Ensure that Everyone is Made Aware of their Recordkeeping Responsibilities

Plan How it will be Implemented throughout the Organization

Take Steps to Ensure Ongoing Success

Make Sure the Retention Schedule Is Legally Acceptable by Making Sure it is Adhered to Throughout the Organization

Promote Recordkeeping Activities Provide Training to the Organization Develop Procedures

Case Study

The 1998 Process Used

In GTE

(Eight Months of my Life)

Team Established

– Legal– Regulatory– Finance– Tax– Human Resources

– GTE Directories– GTE Wireless– GTE Supply– GTE Telops– GTE Service Corporation

A Cross-Organizational Project Team was

Chosen

Team Goals Developed

Keep it Short and Simple Adhere to Actual Legal and/or Regulatory

Requirements Linking Responsibility for Compliance at a

High Level in the Organization Policy Development Criteria

Legal Research

2,758 Federal and/or State Legal Requirements, Statute of Limitation Periods or Regulatory Requirements were Identified, Documented and Categorized

SUBJECT CLASSIFICATION LEGAL OR REGULATORY

CITATION

RECORD-

KEEPING

REQUIREMENT

STATUTE OF

LIMITATION

ACTION

- Check Requisitions, Invoices US 17 CFR 257.2-14(e)US 49 CFR 1220.6-C4(b)AL NARUC 59fIL 83 ICC 705 53(f)NC NCGS 105-113-58NC NCGS 105-164.22SC SCCA 12-35-1250

6 Y3 Y6 Y3 Y3 Y3 Y3 Y

- Donations

- Expense Reports US 26 CFR 1.162-17US 48 CFR 4.705-1(c)VA VRR 300-01-2

Maintain4 Y4 Y

- Accounts Payable Ledgers US 17 CFR 257.2-11 Settlement

- Property Tax US 26 CFR 1.274-5TCA CC 1506KS KSA 79-201-fTX Rule 3.281

MaintainMaintain

Legal Research - Example

Skipping a Records Inventory!

GTE had 120,000 Employees Local Phone Service in 28 States Wireless Service in 17 States 8 International Operations 8 Retention Schedules

Comparison of Existing Retention Schedules

Spreadsheet Developed to Compare 8 Existing Retention Schedules Used by Various Operating Units

1,814 Record Titles/Subjects Were Compared

Comparison of Existing Retention Schedules - Example

SUBJECT CLASSIFICATION L-901 DIRECT GOVT HR/PAY SVC CORP

SUPPLY TELOPS WIRELESS PROPOSED

Accounts PayableAnalysisBatch LogCapital Project Interface Detail ReportConstruction BillsDirect Deposit RecordsDistributionDrafts PaidDistribution SummariesIntercarrier PayablesListingRoyalty FilesWire Transfer Requests

3

7

7

CT 333

6

CT 3

CT 3

6 CY 5

CY 3

3

CY 6 3

3

2

10

Retention Periods Recommended

Consolidation of Record Subjects Consensus on Utilizing the “3-Year Rule” Identified the Longest Recordkeeping

Requirement Considered Risk Taking Team Consensus on Proposals Development of Cross-Reference Listing

Proposed Retention Schedule Routed to SME’s

Initial Team Recommendations for the Proposed Retention Schedule were Routed to Subject Matter Experts to Obtain Feedback

Feedback Used to Further Adjust Proposed Retention Periods, Add Classifications, etc.

Distribute for Review and Approval

Task Team Members were Responsible for Disseminating the Proposal to the Proper Individuals within their Organization for Approval

Modifications Made and Resubmitted Final Sign-Off was Obtained

Published, Communicated and Implemented

Corporate Procedures were Utilized to Publish the New Retention Schedule and Records Management Policy

Public Affairs was Charged with Communicating

Records Management was Charged with Implementation

Questions?