Connecticut Employment Lawyer & Attorney : Daniel Schwartz : Stamford, Hartford New Haven, CT

Last month, I suggested that there was not necessarily a "crisis" in personnel file litigation in Connecticut, because the rules for personnel files had long been established.  Given that this blog has been discussing document management policies this week, it would be fair to say, however, that many employers could do a better job managing and keeping track of personnel files.

In fact, a recent example in Illinois shows that preserving and protecting personnel files is a national concern.   

So, what is meant by a "personnel file"?  It may conjure up images of rows of file cabinets, but Connecticut has a specific law on the subject.  Connecticut defines a personnel file to include all documents and reports which:

are used or have been used by an employer to determine such employee’s eligibility for employment, promotion, additional compensation, transfer, termination, disciplinary or other adverse personnel action . . . including those relating to such employee’s character, credit and work habits.

In other words, “personnel file” includes any documents that are used to make decisions about the employee’s employment. Could this include e-mails which discuss the above? It very well might.  Could it include a supervisor's "desk" file? Sure. 

With me so far? Then it also important to also understand what is NOT included in a personnel file in Connecticut.  Specifically, personnel files do not include:

• stock option or management bonus plan records
• medical records,
• letters of reference or recommendations from third parties including former employers,
• materials which are used by the employer to plan for future operations,
• information contained in separately maintained “security files”,
• test information where disclosure of the information would invalidate the test, or
• documents that are being developed or prepared for use in civil, criminal or grievance procedures.

The most important part of these requirements to think about now in this day of electronic data is to make sure that electronic data that may be considered part of a personnel file is protected and preserved.  Many performance reviews are now done online; what efforts is the company making to preserve the integrity of these documents?

Without moving to a more modern view of a "personnel file" where electronic data is stored and treated the same as various paper documents, a company runs risks later for its failure to produce an entire personnel file. 

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Yesterday, I noted that Norwalk Community College had been sanctioned over the summer  in a federal district court case for its apparent failure to preserve electronic data.  I've always believed that these types of compliance issues -- if they exist -- do not exist in a vacuum. Indeed, companies that have trouble keeping track of their data and their compliance obligations often run into problems in more areas than just this one. 

Reading the minutes of the most recent Board meeting of the CHRO confirmed this theory for me.  It turns out that Norwalk Community College has had issues with compliance with its affirmative action plans and keeping track of them. According to the minutes, the College allegedly never received notice of a disapproval of its affirmative action plan from a prior year (and thus did not appear to address the deficiencies noted in it).  Indeed, when the College submitted its affirmative action plan this year, the CHRO originally recommended disapproving it.  Notably, the College achieved (according to the minutes) only 3 out of 16 goals that were set in the plan.  The CHRO chair stated that this seemed "low".  Ultimately, the CHRO approved the plan noting the College's "good faith efforts". 

The relevant portion of minutes is as follows:

The following individuals were present representing Norwalk Community College: President David Levinson, Human Resources Director Ginny Dellamura and Affirmative Action Officer Natasha Maynard. The plan is being recommended for approval based on compliance with the good faith effort standard. Short-term goal achievement was 3 out of 16 or 19% and total goal achievement was 3 out of 16 or 19%. Promotion goals were not set in the prior plan. The plan was approved in 2002, 2003 and 2004, disapproved in 2005 and approved in 2006.

Commissioner Lobon asked if the plan’s status would not have changed if they were notified of their deficiencies from last year. Staff confirmed that is correct. The original recommendation of disapproval was based on the fact that the College did not address prior deficiencies and CHRO staff subsequently found out that they never were informed of them in the first instance. The Chair commented that the attainment of contract goals is low. Mr. Bingham stated his intent to meet with representatives of the College after the meeting to discuss this issue.

Ultimately, it appears that the College is addressing these issues and it would unfair to single the College out for its oversight here.  Documents get lost and people sometimes overlook issues, with no evil intent.  But when multiple issues arise regarding compliance (either with state laws or federal discovery requirements), it can be a sign that a company needs to take a step back and make sure that these occurrences aren't symptomatic of something larger.

For Connecticut employers, always take issues of compliance seriously and take this example to heart.  If you find an issue in one area, make sure that the same issues do not arise in other areas.

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You're an employer in Connecticut. You've just been sued.   Besides contacting a lawyer (and you ARE contacting a lawyer, right?), what else are you doing about the new case? 

A new case in Connecticut suggests that preserving electronic data should be a top priority.  Why? Because under new court rules, failure to do so could lead to sanctions or inferences that a party destroyed evidence that would've been harmful to its case.  Indeed, the case suggests, in fact, that the duty to preserve evidence may arise even before the lawsuit is filed. 

In, Doe v. Norwalk Community College, 2007 WL 2066497 (D. Conn., July 2007), the court granted a motion for sanctions against a party who had failed to preserve electronic evidence.

Under the new safe harbor provision of Federal Rule of Civil Procedure 37(f), data management must be maintained through a routine system; moreover, the company must take some affirmative action (such as a letter to key potential witnesses and IT consultants within the company) to prevent that everyday system from destroying or altering information once the party becomes aware of the case.

In this case, the party (Norwalk Community College) did not do so.  It did not preserve the hard drives of key witnesses. Indeed, and even more damaging, those hard drives had been cleaned of data.  Indeed, the expert for the other side -- who inspected the  computers, concluded that there were inconsistencies in the PST or Outlook e-mail files. 

Because the company did not suspend the routine document destruction policy and "put a litigation hold in place," the court rejected any safe harbor arguments under Rule 37(f). Instead, the court granted the plaintiff request for sanctions and imposed an adverse inference jury instruction regarding the destroyed evidence (along with attorneys fees, costs and expert fees).

So, does this mean that an employer can wait to be sued before preserving evidence?  This decision clearly says no.  It found that the obligation to preserve evidence arises even before the lawsuit is filed.  Following other precedent, the court held that the duty to preserve electronic data arises at the time when litigation is "reasonably anticipated". 

While some employers and companies prefer to handle pre-litigation matters by themselves, the case serves a reminder that little actions (or inactions) at the start of a case can have much larger consequences down the road.  Issuing litigation holds and suspending routine document retention policies upon notice of a complaint may be one way to avoid these larger consequences down the road.

(Hat tip: Delaware Corporate and Commercial Litigation Blog)

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