Save all email, not some
Your customer's employees will save emails no matter what, and they'll do that in many ways, from PSTs to personal archives. Deleting an email off the email server just makes it more difficult to find, not safe from liability.
One bad email may be mitigated when viewed in the context of the entire message thread, making it much more compelling for counsels to have all email saved rather than just one incriminating piece. Convey to your customers the importance of keeping email for longer periods of time and lessen their liability.
Read more of Bill Tolson's liability response on SearchStorage.com.
Special regulatory requirements
The only special media requirements imposed by the U.S. and state government are on securities brokers/traders that do business in the United States -- their correspondence and their records must be stored on a WORM (write once read many) device such as a CD or DVD recorder to prevent data from being altered. This is under the auspices of SEC Rule 17 where they stipulate WORM media.
Read more of Bill Tolson's special regulations response on SearchStorage.com.
Email policies and employee privacy
When using the company's email system, employees should not expect to retain their privacy. Your customer may want to display a note when an employee first signs on, which may remind users that the email is a company asset to be used for businesses only. In Europe, the laws are different. "Data protection acts" protect employee information under certain conditions, and a company may have to get permission to use an employee's email.
Read more of Bill Tolson's email privacy response on SearchStorage.com.