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Q&A: Understanding the E-Discovery Implications of Employee Status Changes

Created on March 10, 2014


Understanding the E-Discovery Implications of Employee Status ChangesExterro and FTI Consulting recently hosted a webcast, “Understanding the E-Discovery Implications of Employee Status Changes.” The presentation addressed the risk of corporate data spoliation caused by employment status changes, such as departures or departmental transfers. Presenters Antonio Rega, managing director at FTI Consulting, and Scott Giordano, corporate technology counsel at Exterro, examined the issue and offered a number of best practices and technology considerations surrounding this very common challenge.

The full, one-hour webcast is available for on-demand viewing. Antonio and Scott also took part in a 5-minute webcast synopsis presentation, which highlights the major webcast themes and best practices. 

The webcast discussion generated several audience questions that couldn’t be worked into the live broadcast. Some of those questions, along with responses from Antonio and Scott, are posted below.

Q: What is a "DOD wipe" compared to a "Windows wipe"?

Antonio: Essentially, a “DoD” (Department of Defense) grade wipe greatly increases the likelihood of data being unrecoverable, due to the patterns utilized across the hard drive during the ‘wiping’ process. A DoD wipe is also usually performed on the drive a number of times, with each ‘pass’ decreasing the likelihood of data recovery. More info can be found here.

A “Windows” wipe is typically a reference to a re-formatting of the operating system/hard drive (in other words, it’s actually more of as re-formatting rather than a “wiping” of the drive) utilizing Windows-based software prior to re-installing a Windows operating system. Although this method does also “delete” all contents, it is far less intensive and therefore allows for greater probability for recovery of data, even after a new operating system is installed post-“wiping”.

 

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Organizations need a systematic plan for protecting vulnerable data tied to departing employees
Q: When an employee leaves, we copy hard drives and personal drives to a secure network share, and unless the employee was subject to a legal hold the folder may be deleted after a year, which of course doesn't always happen. The e-mail is also archived when they leave.   What are your thoughts on only copying the hard drives and personal drives?

Antonio: Email is also very important to retain when under a litigation hold, arguably even more important than any other sources of data. I wouldn’t advise to stop archiving email under a litigation hold.

Scott: I agree—regardless of hold status, email and documents complement one another and should be retained as a “pair” if you’re going to retain them at all.

Q: What are the ramifications of failing to release legal holds after litigation has concluded?

Scott: If a new matter occurs after that non-release, the ESI in question is amenable to discovery.  If there are documents that potentially damage your position in the matter, that opens the door to an unfavorable and expensive settlement or loss at trial.

Q: What kind of an ROI can you expect by proactively instituting and executing a policy to manage employee departures?

Scott:  The ROI can be significant and is based around mitigating the following risks and the costs that come with them:

  • Sanctions from loss of ESI that should have been retained
  • Loss of exculpatory documents and resulting loss at trial or an unfavorable settlement
  • Loss of intellectual property or confidential information, especially that of business partners
Q: In large organizations employees can exit before corporate functions are aware or with very little notice. Is there a best practice for getting the exit interview data quickly? Also, are there circumstances where it might be appropriate to make exit interviews anonymous?

Antonio: Arranging for exit interview can indeed be challenging at times for the reasons you outline. Depending on the work environment/organization, we sometimes suggest having employees sign waivers when initially hired (or whenever an exit interview process if formalized, at which point it may require all employees to sign off/agree to the terms) that may include clauses that would incentivize employees to complete the exit interviews prior to or upon departure.

Additionally, automated processes with tools such as Exterro® (and other similar technology management tools) can help to automate and expedite exit interviews, as well as flag those individuals that are departing to greatly minimize the potential of missing someone.

Having a ready-made set of questions crafted per department will also greatly help avoid any delays.

To the second part of the question, it would be difficult to make the process “anonymous” as items requiring action will need to include knowledge of the departing employee’s data assets, but as alluded above, there certainly are methods to help automate interview questions so that they can be filled out via a software app or custom database login so that the employee need not “speak” to a company representative, per se.