The vast amount of old documents and papers that the average business has lying around would be enough to shock anyone. It is incredibly easy for the accumulation of paper and documents to become overwhelming, especially in an office setting.
A huge amount of these documents could also contain sensitive and confidential data. Having these types of documents lying around and in no order is very dangerous. This is because this is information that cannot get into the wrong hands.
Shredding is one of the most effective ways of gaining some control over your document organization. However, you need to be extremely careful, and check that you are shredding the correct documents. You have to make sure you are not shredding documents that could be very important to business operations and performance.
In this article, we will take a look at the documents that should not be shredded, the documents that can be shredded, and the best time to shred them.
Why Do Businesses Need To Shred Documents?
Shredding papers and documents is a practice that not enough businesses utilize. A lot of businesses and organizations struggle with the amount of unnecessary space and resources that piles of documents can occupy. The shredding of documents frees up a huge amount of space and resources that can be used for other, more important, things.
There are several important reasons why businesses shred their documents that go far beyond the space they take up. These are:
Protect Sensitive Data - More often than not, these documents can include a large amount of sensitive and confidential data. Therefore, shredding and destroying this data will help protect the data from getting into the wrong hands. If the data ends up in the wrong hands, then it can leave the organization exposed to potentially dangerous data leaks.
Data Regulation Compliance - In the United States, there are numerous data regulation laws that organizations must adhere to. The act of shredding sensitive documents and hard drives to destroy data helps organizations comply with the data privacy and data destruction laws that exist in the United States.
Internal Organization - Documents and files can take up a large amount of space within an organization or office space. Therefore, organizing these documents via shredding helps a business to get on top of its internal organization. This can have a positive impact on the overall processes and organization within a business.
What Documents Can Be Shredded By Businesses
Many different documents should always be shredded to protect the privacy of your business, employees, and customers. These documents are:
Tax Records - Tax records should always be eventually shredded. However, it is recommended to hold onto these kinds of documents for up to seven years. The Internal Revenue Service (IRS) may need these receipts and documents to back up your numbers. The seven-year period will ensure that you are safe. After seven years have passed, these documents should be shredded and discarded.
Employment Tax Records - The IRS recommends that all businesses keep hold of their employee tax records for at least 4 years. This is to cover themselves in case an employee questions them at all. After these 4 years, you should begin to shred these documents as they feature very sensitive and confidential information about your employees such as identification numbers, personal info, and salary information.
Bank Statements - You can typically shred your paper bank statements and documents after around a year of use. This is because you can now access all your bank statements online. However, if you need bank statements to support and prove your tax returns, then you should keep a paper copy at hand.
HR Records - The U.S. Equal Employment Opportunity Commission (EEOC) states that if your business employs more than 15 people, then you must legally keep employee records for at least a year. These records include job applications, promotions, employee tests, layoffs, and even documentation for applicants you don’t hire. However, accountants and lawyers will recommend that you keep these documents for longer than a year in case an employee ever tries to make a claim against your organization.
What Documents Should Not Be Shredded By Businesses
While many documents can be shredded and destroyed, there are also many types of business documents that should always be kept ahold of. These documents are:
LLC Records - It is extremely important that you keep all documents and business records related to your LLC. This includes all your business formation documents; bylaws; articles of organization; lists of shareholders, members, and directors; annual reports; meeting minutes; and trademark, copyright, and patent registrations. These documents are important for your business, so making sure that they are very secure is integral.
Legal Contracts - It is suggested that businesses hold onto all legally binding contracts long-term. This includes any lawsuits that were made, claims made, as well as long-term contracts with vendors and businesses. In addition to this, it is also important to keep hold of any contracts that you have related to your lawyer, as they can come in handy further down the road.
Internal Financial Records - Keeping a copy of documents such as income statements, cash flow statements, and balance sheets is also very important. This is because these documents will help you monitor and determine the success of your business. You will be able to see how your business has either progressed or regressed from year to year. A business cannot succeed without understanding how it is currently performing in comparison to its previous performance.
High-Quality Data Destruction Shredder From Whitaker Brothers
Here at Whitaker Brothers, we carry the highest-quality commercial-grade shredders on the market. We have a huge collection of shredders that are available in various degrees of security, ranging from Level 1/P-1 to Level 6/P-7 High Security. Whether your business is looking for a robust device designed for high volumes and demanding environments, or a more lightweight and practical machine for small offices, our impressive collection has everything for you.
