For the record, good file management pays off
People become packrats because they believe it never fails that they will need something the day after they’ve discarded it. Then one day they look at the bulging file cabinets and closets and decide to purge everything. Unfortunately, neither extreme is a good idea.
But middle ground in record keeping can be found by drafting a written retention policy. According to Marshall Filler, senior partner of Filler & Weller, a company record-retention policy has significant benefits.
“An ad hoc policy can be a real problem. Permanent record retention is costly, particularly if it is in paper form and the ‘we’ll throw ’em out when we run out of room’ policy can get you in trouble,” he told AIN. Alexandria, Va.-based Filler & Weller represents airlines, repair stations, manufacturers, pilots, mechanics and distributors in matters pertaining to regulatory compliance.
One of the most important reasons for a formal policy at a Part 145 maintenance shop is to ensure compliance with legal requirements. Filler also said a formal policy minimizes the likelihood that questions will be raised when documents are destroyed.
“It’s obstruction of justice to destroy evidence during a government investigation, so no record should be destroyed while an investigation is pending without advice of counsel,” he said. “But even records destroyed leading up to an investigation can be a problem unless it occurred in compliance with an established policy, such as the destruction of records at specified time intervals.”
The problem is determining how long to keep each type of record. Different records often have different retention requirements, with numerous agencies such as the FAA, IRS, OSHA and EPA getting into the act. Even customers may call for the retention of specific records, such as work orders, in their contract.
Specifying record-keeping provisions in contracts with customers is desirable because it protects both parties. Filler said the following questions should be considered:
• Who keeps originals and who gets copies?
• Who will maintain records of the last complete overhaul if it goes beyond the regulatory retention requirement?
• Who is responsible for keeping any records for more than the two-year period required by FAR 145.219?
• What about special requirements of individual customers?
• Which records will be provided to the customer and which ones will be retained at the repair station?
• Who has the responsibility for accomplishing ADs?
Records may be kept for all kinds of transactions and events. They may be regulatory in nature and specified by local, state or federal agencies. Then there are business contracts with suppliers and customers, including warranties, purchase orders and service contracts. Internally, a company will have many different records pertaining to finances, payroll, taxes and so on.
All records fall into one of two categories: required and desired. Required records are specified elsewhere, such as in the FARs, and the company is required to comply. Desired records are not required but for various reasons may be beneficial for the company to keep. They may range from a sales receipt so you can return a purchase if there’s a problem to a database of customer information to be used to cultivate future business.
Until a few years ago, storing records required a lot of space because most were on paper. The options were storing them in filing cabinets or boxes located in your office or depositing them in a remote storage facility that could be under your direct control or that of a third party. Remote storage records are available but not as easy to retrieve, so remote facilities are best suited for older materials. Some companies have turned important records into microfiche, making them easier to store but more difficult to work with.
A Digital Future
Today, the business world is in a transitional phase as it shifts to a paperless society. Some say there will never be a complete transformation and point to the overwhelming majority of businesses that create documents on a computer only to print them out and store them conventionally. Still, the demand for electronic record scanning and storage continues to increase slowly.
The Gulfstream Service Center in Appleton, Wis., recently conducted the first complete logbook review for an aircraft maintenance inspection using AirLog Imaging aircraft records on CD-ROM. The procedure was a 12-month/600-hr inspection on a Hawker 800XP owned by U.S. Filter of Palm Springs, Calif.
AirLog takes the boxloads of maintenance paperwork that an aircraft generates and digitizes every single document onto CD-ROM for quick location and viewing using AirLog’s software program. The digitized records are word-searchable for quick research, allowing the maintenance technician to locate current and historical maintenance information about the aircraft in seconds, according to AirLog.
Gulfstream’s Mark Traxler was the first maintenance technician to use the CD-ROM containing digitized aircraft records. Comparing the paper and CD-ROM methods for reviewing the volumes of documents associated with a thorough inspection, Traxler said, “We could not find some information using the conventional means for records research, but with the ability to search using the CD we found everything right there.”
AirLog co-founder and president Mike Head said, “It’s exciting to be able to provide the solution to a long-standing aviation problem.” Cost of the AirLog system varies, depending on the volume of data to be digitized. Treatment of the first “bankers box” (18- by 12- by 12 in.), which can hold up to 2,500 pieces of paper, costs $3,900. Each subsequent boxload costs $2,000.
When the time comes to destroy hard-copy records, most companies simply throw them out in the trash. Records provide a picture of a company’s business, revealing clients, the type of services they need and what they pay for them; the company’s costs and supplier discounts; legal issues of the company; personnel records; and countless other documents potentially containing sensitive information. Those old records could be just what the competition needs to edge a repair shop out of the market. All records should always be destroyed to ensure confidentiality.
How Long Is Long Enough?
The majority of records generated do not have a specific retention time required by law or contract. The trick is to keep records long enough to cover yourself legally but not so long as to amass a huge archive that just begs an auditor to go on a fishing expedition and find something wrong.
Filler said FAA-required records should generally be kept for a minimum of two years, but it is important to check other regulations, such as FAR 121.380 (maintenance-recording requirements), to see if a particular record must be retained longer. There are various provisions specified in Parts 91, 121, 125, 135 and 145, so it is important to refer to the appropriate regulation when developing a company record-retention policy. Having a policy to destroy a record at a given time would appear arbitrary to an auditor if it were not justified with a specific reference or logical explanation.
Regs Stipulate Retention Time
On the other hand, an accident or incident will inevitably find its way back to the repair station. The investigating authority will be looking for problems and the operator will try to shift responsibility anywhere but home. Customer claims of defective work, failure to perform the necessary scope of work and even whistleblowers trying to even a score may be sufficient reason to hang onto some records longer than the minimum time. A good record-retention policy will consider such issues.
Under Part 43–Maintenance, Preventive Maintenance, Rebuilding and Alteration–FAR 43.9 specifies how work must be recorded. The types of record used to comply with this section include an 8130-3 tag, work cards, yellow tags and logbooks. FAA Form 337 is also an important record generated under Part 43. A Part 145 repair station must retain these records at least two years.
Filler said, “Under FAR 145.221 of the newly issued regulation (reports of failures, malfunctions or defects), the reporting time under the old 145.63 has been increased from 72 to 96 hours, but I still suggest that reports of defects or unairworthy conditions should be retained permanently. Under the newly issued rule, which doesn’t go into effect until April 2003, the record-retention period will remain at two years, although there have been some relatively minor changes in the scope of the records that need to be retained.”
When working on air-carrier aircraft, the repair station must choose the correct option regarding procedures and records. FAR 145.2 requires the maintenance facility to follow the carrier’s maintenance manual and Part 121 requirements or a Part 125 inspection program as appropriate. Under Part 121, the minimum retention period is one year or until the work is superseded.
“As a general rule, air carriers must retain overhaul records until superseded by work of equivalent scope and detail as per FAR 121.380(c),” Filler explained. Then there are records that should be kept permanently.
According to Filler, the following records should be retained and transferred with an aircraft at time of sale: total time in service (airframe, engine, propeller, rotor), current status of life-limited parts, compliance with airworthiness directives, current inspection status, time since the last overhaul and a list of major alterations and alteration and repair reports.
The issue of record retention can be murky. What records to produce and how long to save them can vary significantly among the various operational regulations. Filler strongly recommends consulting with an FAA inspector, local counsel, regulatory counsel or an accountant depending upon the nature of the record in question\