The New Hampshire Supreme Court issued an important decision on February 21,
2007, in the case of Appeal of Alan Hardy. The decision will have ramifications
regarding the award of attorney’s fees in whistleblower cases and other matters
before the New Hampshire Department of Labor.
Mr. Hardy was the general manager of the Hopkinton State Fair Association. He
met with resistance when he attempted to persuade the Association’s Board of
Directors to implement policies pertaining to pecuniary benefit transactions and
conflicts of interest, which were required for non-profits by New Hampshire law.
When the Board learned that Mr. Hardy had reported his lack of success to the
New Hampshire Attorney General’s office of charitable trusts, the Board
eliminated the position of general manager. Mr. Hardy prevailed in his
whistleblower claim, but the Department of Labor (“DOL”) declined to award him
his attorney’s fees.
There is no specific statutory authority for the award of attorney’s fees
under the Whistleblower Protection Act (RSA 275-E). However, the statute
authorizes broad remedial measures, including reinstatement, back pay and “any
appropriate injunctive relief.” RSA 275-E:4, I. The majority of the Court
found that reimbursement of attorney’s fees and expenses is “an appropriate
exercise of the DOL’s injunctive relief authority.” The Court reasoned
that this interpretation would best effectuate the statute’s goals to encourage
employees to come forward, to ensure alleged violations are resolved quickly and
informally, and to restore the wronged employee to the position he would have
been in absent the violation. The Court concluded that a fee award “strengthens
the statute’s deterrent effect as well as the DOL’s ability to vindicate public
rights.” Two of the five justices dissented, contending that expanding the
remedies in the absence of specific legislative authority would lead to
uncertainty as to what remedies were available and would infringe on the
legislature’s authority to determine the scope of administrative agency
authority.
This opinion, while limited to a specific statute, turned on the protective
nature of the legislation and will likely authorize an award of fees under other
protective statutes, such as wage claim laws. Employers should work even harder
to avoid these claims, to carefully evaluate them when made, and strive to
resolve them quickly.
