Hi - my name is XXXXX XXXXX X'm a Business litigation attorney here to assist you.
Payroll registers are to be kept at least 3 years (http://www.qbalance.com/record_retention.htm), but most retain records for 5 years as a rule of thumb.
Your three years would be up this year for a 2008 issue, so whether there's a problem depends on when the 2008 issue was. If it was after the three years expired, your company doesn't have any liability. If the three years were not up and the records were destroyed, there may be some liability.
Also, if you provided all of the payroll records to the client, you could claim that you didn't retain them because you turned them over to them. That is about the best defense/excuse for not retaining the records.
The company could still sue, but the lack of records would make things difficult.
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