Microsoft 365 Litigation Hold Vs. Retention Policy

Himanshu Goyal
Himanshu Goyal | Updated On - 02 Jun 2021 |

It is crucial to prevent unauthorized deletion or modification of data from cloud platforms; else, any user could manipulate the essential data of your organization. In Microsoft 365, you are provided with two native features, which include Retention Policies and Litigation Hold.

These two functions might sound similar to you, but they are entirely different as they fulfill different roles. Thus, understanding the difference between these two functions is vital in order to prevent security breaches and secure your organization’s data.

Here, we will talk about how these two policies are different than each other, how they can be used, and how they can minimize the risk of data loss in your organization.

What is a Retention Policy?

The data retention policy in Microsoft 365 is used for the prevention of malicious deletion or alteration of valuable data. However, these policies vary from business to business based on their risk profile, internal policies, and work environment.

As mentioned above, retention policies are used to protect valuable data from accidental deletion. Moreover, it can be applied to the entire organization, a group of users, as well as a single mailbox. When you create an organization-wide retention policy, it would be applicable to all users.

  • Categorizing Data
    There are multiple data types stored in the cloud environment based on your organization’s requirements and regulatory requirements, and you need more than one retention policy to secure those data types. However, to apply the right policy to the right data, you need a well-defined data identification, classification, and labeling process.
    Without using this process, you might end up deleting the data types even before the end of their useful life, or you could also hold up the data for a longer time than required.
  • Data Retention
    After applying any retention policy on data, its content will remain unchanged for the specified period unless any user tries to edit or delete the content. Whenever someone tries to delete any data that is protected with the retention policy, the original data type will be moved and secured either in the Recoverable Items folder or Preservation Hold Library. The data will be available here until the specified retention period.
  • Handling Data after the Retention Period
    This is one of the critical parts of the Retention Policy, which defines what will happen to the data once the retention period is over. There are few options available for that, such as:

    1. Delete automatically – The entire data will be deleted automatically after the retention period ends.
    2. Flag – This option allows the administrator to review the aged-out data manually to verify whether the data should be deleted or retained for an extended period.
    3. Retain without protection – The protection will be removed from the and so it can be deleted/modified naturally.

    In our opinion, the Flagging data is an ideal option that businesses should choose, as it will protect you from potential data breaches.

What is Litigation Hold?

Litigation Hold is not a general-purpose feature like retention policy. It is a unique functionality of the eDiscovery feature in Exchange Online that is helpful in freezing prominent data, which is more prone to deletion. Earlier, it was applicable to entire mailboxes, but now you can decide what data or content you want to protect.

  • How does a Litigation Hold work?
    Litigation Hold can be applied manually to limited users and data types. But, when it is used for any data, it will outdo the retention policies applied to that data. However, once the Litigation Hold is over, the retention policy will take priority over data again. Also, it is crucial to understand that Litigation Hold cannot preserve data retroactively, which means if any data is deleted before implementing litigation hold, then it will not be protected unless it was already under a retention policy.
Reason to use Both Retention Policy and Litigation Hold

There is a solid reason behind using both retention policy and litigation hold in Microsoft 365. For instance, if you use retention policy, then the aging out data could be disposed of automatically during litigation. Similarly, if you use only Litigation Hold with applying retention policy, then any data deleted before implementing litigation hold might be out of your reach.

Below are a few points that describe both these functions in a simple way.

  • A retention policy can be applied to new users automatically; Litigation Hold has to be applied manually to every new user
  • Retention policy prevents hard-deleting data by moving the original data to archive; Litigation hold enables recovery of data to prevent it from deletion
  • Retention policy sets time limitations on preserving the data; Litigation Hold can be turned Off and On manually
  • Retention policy takes around 24 hours to start working, whereas, Litigation Hold starts working with 60 minutes

These points clearly define the use of both Retention Policy and Litigation Hold in Microsoft 365, and how they could be beneficial to preserve and secure your data.


Both Retention Policy and Litigation Hold provide security to your data. But both these facilities are available with a high-end Microsoft 365 subscription. In case you are using a basic Microsoft 365 subscription, then you won’t be able to take advantage of these facilities. In such situations, it’s better to backup your Microsoft 365 data continuously with the help of a useful tool like Kernel Office 365 backup & Restore.

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