Retention Policies vs Retention Labels in Microsoft 365
Retention in Microsoft 365 can feel confusing with so many options, but it really comes down to two main tools: retention policies vs retention labels in Microsoft 365. Policies act like a big blanket that covers entire workloads such as Exchange, SharePoint, OneDrive, Teams chats, and even Copilot chat data. They work silently in the background, making them perfect for enterprise-wide rules like deleting Teams chats after three years or keeping all emails for seven years.
Labels, on the other hand, are precision stickers applied to individual items like contracts, HR files, or important emails. They can declare records, trigger event-based retention, and even require a multi-stage disposition review before deletion. Labels also integrate with other Microsoft 365 solutions such as Syntex, Insider Risk Management, and DLP to provide smarter governance.
Most organizations don’t choose between the two—they layer them. Policies provide the safety net, and labels deliver fine-grained control where records and compliance demand it.
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