Human Resources & E-Discovery Law: New Challenges in Museum Admi

Transcription

1 Human Resources & E-Discovery Law: New Challenges in Museum Admi Timothy Chester Timothy J. Chester & Associates Daniel Estrada D.C. Estrada Star Swift, JD, MLIR Grand Valley State University

2 Every story has two sides Agenda: Real Life Scenarios Discuss what museums must do now to avoid expensive litigation problems later Moral of our stories: Follow the money E-discovery concepts are not difficult, but they are complex What you decide to ignore will hurt you It is your fiduciary duty to put policies / processes in place now Show me the money! E-discovery will cost you money (not if but when) E-discovery planning will save you money Your fiduciary duty to the museum is to take care of the institution s money.

3 Example #1: Supervisor Termination Supervisor with excellent work record 2 employees (both disabled) Employees claim physical and sexual abuse Supervisor denies everything Other employees say they have seen nothing

4 Example #1: It used to be simple Investigation Conducted: All employees interviewed by museum attorney Supervisor retains an attorney Museum Director terminates supervisor at conclusion of attorney s investigation and recommendation Arbitration hearing is conducted Main evidence at hearing is employee testimony Supervisor s termination is upheld Costs: Museum s Attorney Fees Arbitration Fees Court Reporter Fees Total Cost of Termination: $ 2,000 4,000 1,000 $ 7,000

5 Example #1: with E-Discovery Things have changed: Electronic data now used in investigations & lawsuits (called e-discovery) Requirements: Hold all material for reasonably foreseeable litigation Hand over relevant electronic material Voic IM Text messages e-documents Databases Social media sites (Facebook, MySpace, etc.) Video RFID / magnetic keycard logs Increased Storage Costs Good faith in managing your information (records management practices scrutinized by court) You pay for your own discovery

6 Example #1: Relevant Material messages between colleagues (administrator, HR, administrator, employees) Logs of Internet use (sites visited, information posted, etc.) Internal policies, complaint processes What policies were kept How they were distributed How they were enforced, audited Voic Text messages Video Keycard logs OMG!

7 Example #1: Minimum Costs IT time collecting data (1 week) Forensic investigation of 3 computers Administrator time reviewing materials (1-2 weeks) Attorney review time (40 $300/hour) Expert fees Total E-Discovery Cost: $ 1,150 9,000 4,000 12,000 5,000 $ 31,150 Does not include: Producing paper, other attorney time, staff time, insurance premiums and deductibles, etc.

8 Example #1: Minimum Costs Previous Cost of Termination: $ 7,000 Total Cost of E-Discovery: $ 31,150 Cost Increase: $ 24,150

9 Example #2: Damaged Artifacts Museum A contracts with Museum B to use some of Museum B s valuable artifacts Museum A contracts with Trucking Company (TC) which specializes in moving such artifacts TC leaves the artifacts on Museum A s loading dock late Friday night The artifacts are damaged, some even destroyed Litigation ensues

10 Consequences of E-Discovery Mismanagement: High costs compared to paper discovery (more data) Settling cases because too expensive to litigate (you did not prepare) Court sanctions (fines, judgments against you) for mismanagement Losing cases because of mismanaged evidence, not the merits Fiduciary duty violated: you were not a good steward of museum s money Donor scrutiny due to mismanaged funds / ignorance of risk

11 Preparing for E-Discovery: You have state-of-the-art security systems to prevent theft Why no protection against litigation?

12 Preparing for E-Discovery: Getting Started Legal department and outside law firm won t solve the problem! Collaboration between functional groups is critical (IT, Legal, records management, HR, compliance) Understand the information you create and store Who/what creates it? Where is it stored? Who has access? How long is it kept? Why? Keep only what you need Update policies / employee handbook Plan for the e-discovery process Educate employees

13 Preparing for E-Discovery: Policy Considerations Why policies protect you: Keep you from having to save everything ($$$ on storage and litigation) Outline clear expectations to employees Example #1: Policy would have protected museum from liability Prove to the court that you managed records appropriately (no wild goose chases needed) Help keep you in compliance with regulatory obligations (HIPAA, FTC Red Flag Rules, FMLA, EEO, etc.) GET HELP! Complex risks require practical solutions What to address in policies: Retention (how long records are kept) Employee communication ( , IM, personal accounts) Social media use (work vs. personal) Acceptable use of computer systems Legal holds (protection records subject to litigation)

14 Questions?

15 Contact Information Timothy Chester Principal, Timothy J. Chester & Associates (616) Daniel Estrada President, D.C. Estrada (616) Prof. Maris Stella (Star) Swift Grand Valley State University