Secure shredding services can be provided without a contract, but the legal and liability protection that contracts can provide should make using them standard operating procedure.
A panel discussion at the NAID (National Association for Information Destruction) Annual Conference, which took place in Phoenix in mid-May, featured agreement from an insurance provider, an attorney and NAID executive director Bob Johnson that contracts can either prevent or minimize trouble.
“Without a contract, duties and responsibilities are not defined,” Brett Benton of insurance provider Willis of Arizona told session attendees.
Arizona-based attorney Richard Onsager remarked that oral or implied contracts always exist when a business arrangement is made, but that a written contract “helps avoid the he said/she said cases that fill the court system.”
Additionally, said Onsager, contracts are “a business tool that enhances your professionalism and professional appearance.”
NAID’s Johnson said the existence of written contracts also improves the valuation of a secure shredding firm, as the contracts can demonstrate in writing to a potential buyer the existence of actual future business.
The panelists indicated that secure shredding customers are beginning to insist that their shredding firms should be not just bonded, but also that they are carrying a valid professional liability policy. Such policies can cover some of the financial damages that can result from the mishandling of confidential information. “Customers are learning what questions to ask,” said Benton in regard to liability coverage.
The NAID Conference was held at the Arizona Biltmore Resort in Phoenix and was attended by more than 850 information destruction professionals and their suppliers.