Bill Text - SB358 (2010)

Relative to whistleblower protection and waste prevention in state government.


Revision: March 11, 2010, midnight

SB 358-FN – AS AMENDED BY THE SENATE

03/10/10 0912s

2010 SESSION

10-2873

05/10

SENATE BILL 358-FN

AN ACT relative to whistleblower protection and waste prevention in state government.

SPONSORS: Sen. Carson, Dist 14; Sen. Downing, Dist 22; Sen. Odell, Dist 8; Sen. Gallus, Dist 1; Rep. Quandt, Rock 13

COMMITTEE: Commerce, Labor and Consumer Protection

AMENDED ANALYSIS

The bill expands the provisions of the whistleblower protection act to include employees who object to or refuse to participate in any activity that the employee believes is a violation of law or incompatible with a clear mandate of public policy. This bill also authorizes the labor commissioner to investigate allegations of fraud, abuse, or waste in the expenditure of public funds and adds additional protections to the whistleblower protection act for public employees who file such complaints.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

03/10/10 0912s

10-2873

05/10

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Ten

AN ACT relative to whistleblower protection and waste prevention in state government.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 New Subdivision; Whistleblowers’ Protection Act; Investigation by Department of Labor. Amend RSA 275-E by inserting after section 7 the following subdivision:

Public Employee Complaint Investigation Process

275-E:8 Complaint Investigation by Department of Labor.

I. The department of labor shall have the authority to receive and investigate complaints or information from any public employee concerning the possible existence of any activity constituting fraud, waste, abuse in the expenditure of any public funds, whether state or local, or relating to programs and operations involving the procurement of any supplies, services or construction by governmental entities within the state.

II. The labor commissioner shall make an initial determination as to whether a complaint received under paragraph I is without merit, unfounded, or in need of further information, in which case, the complaint may be dismissed without further action, or held until such time as additional information is received, or dismissed if no further information is received within the time period specified by the commissioner. If the labor commissioner makes an initial determination that the complaint has merit and warrants further investigation, the labor commissioner may undertake such investigation or refer the matter to the appropriate enforcement authority. The identity of the person who filed the complaint shall not be disclosed without his or her written consent, unless such disclosure is to a law enforcement agency that is conducting a criminal investigation.

III. If the labor commissioner undertakes further investigation of the complaint, the commissioner shall have access to all records, reports, audits, reviews, papers, books, documents, recommendations, correspondence, including information or data that is deemed necessary by the commissioner to carry out the investigation and is a matter of public record. Confidential information may be accessed on behalf of the labor commissioner by the agency having authority to review such materials or records. If no agency is available or cannot be determined based on the nature of the investigation, the matter shall be referred to the attorney general or other law enforcement authority for further investigation. The labor commissioner may request such information, cooperation, and assistance from any state, county, or local governmental agency and may coordinate activities with the attorney general’s office. In carrying out his or her duties and responsibilities, the labor commissioner shall report to the attorney general or the United States Attorney or both, any suspected violation of state or federal law.

IV. No governmental entity shall take any retaliatory action against a public employee who, in good faith, files a complaint under this section and the public employee shall be afforded all protections under RSA 275-E:2.

V. If the originating employee’s complaint results in a savings of public funds, the public employee shall be entitled to 25 percent of the estimated savings, up to $2,000. The department of labor shall record the date and time that complaints are received so that, if the department receives multiple complaints regarding the same matter, the originating employee can be determined. If multiple complaints are received at essentially the same time, the labor commissioner shall divide the savings in a proportional manner. In such cases, the employees shall be awarded 25 percent of the estimated savings, up to $2,000 per employee, and not to exceed $6,000 in total funds distributed.

VI. The labor commissioner shall adopt rules under RSA 541-A relative to the complaint investigation process established in this section, including the administrative procedure used for responding to complaints, gathering additional information, rendering decisions, and awarding a portion of any savings generated by a complaint filed under this section to an employee.

VII. For purposes of this subdivision, the labor commissioner shall include any person designated by the labor commissioner to carry out the investigation authorized by this section. Public employee shall mean any employee of a governmental entity, as defined in RSA 275-E:1, III.

275-E:9 Protection of Public Employees. No governmental entity shall threaten, discipline, demote, fire, transfer, reassign, or discriminate against a public employee who files a complaint with the department of labor under RSA 275-E:8 or otherwise discloses or threatens to disclose activities or information that the employee reasonably believes shows a violation of existing state or federal laws or regulations, represents a gross mismanagement or waste of public funds, property, or manpower, or evidences an abuse of authority or a danger to the public health and safety. Any public employee who files such a complaint or makes such a disclosure shall be entitled to all rights and remedies provided by this chapter.

2 Protection of Employees Reporting Violations. RSA 275-E:2 is repealed and reenacted to read as follows:

275-E:2 Protection of Employees Reporting Violations.

I. No employer shall harass, abuse, intimidate, discharge, threaten, or otherwise discriminate against any employee regarding compensation, terms, conditions, location, or privileges of employment because:

(a) The employee, in good faith, reports or causes to be reported, verbally or in writing, what the employee has reasonable cause to believe is a violation of any law or rule adopted under the laws of this state, a political subdivision of this state, or the United States; or

(b) The employee objects to or refuses to participate in any activity that the employee, in good faith, believes is a violation of the law or is incompatible with a clear mandate of public policy; or

(c) The employee, in good faith, participates, verbally or in writing, in an investigation, hearing, or inquiry conducted by any governmental entity, including a court action, which concerns allegations that the employer has violated any law or rule adopted under the laws of this state, a political subdivision of this state, or the United States.

II. Aggrieved employees may bring a civil suit within 90 days of the violation of this section. Courts may order reinstatement, back-pay, and court costs, along with attorney fees. An employer may be fined up to $500 for each violation of this section.

3 Effective Date. This act shall take effect upon its passage.

LBAO

10-2873

01/19/10

SB 358-FN - FISCAL NOTE

AN ACT relative to whistleblower protection and waste prevention in state government.

FISCAL IMPACT:

      The Department of State, the Judicial Branch, the Department of Justice, the New Hampshire Association of Counties, and the New Hampshire Municipal Association state this bill may increase state, county, and local expenditure by an indeterminable amount in FY 2010 and each year thereafter. There will be no fiscal impact on state, county, and local revenue.

METHODOLOGY:

    The Department of State states this bill amends the whistleblowers' protection act, RSA chapter 275-E, to allow the Department to investigate allegations of fraud, abuse, or waste regarding the expenditure of public funds at all levels of government within the state including any programs or operations involving procurement of goods or services by governmental entities and to provide greater protections to employees reporting violations. The Department is not able to determine the potential caseload involved with this proposed legislation. Depending on the volume of complaints, the Department would need to increase its ability to conduct investigations and keep the necessary administrative records relative to any investigations that may be conducted.

    The Judicial Branch states the fiscal impact of the proposed bill on the Branch will be due to the cases which until now could only be brought in the Department of Labor but which, because of the proposed bill, could also be brought in the superior court. The Branch assumes these actions now brought in superior court would be considered complex civil cases with the average cost of processing a complex civil action in the superior court is $559.43 in FY 2010 and beyond, so the Branch estimates that a cost increase as a result of the bill of at least $10,000 is probable. The Branch does not anticipate a rise in appeals to the supreme court as a result of the bill. The Branch has no information on which to estimate how many civil actions will be brought pursuant to the proposed bill, so it cannot reasonably estimate the specific amount of any increase.

    The Department of Justice states the Department of State may seek assistance in the implementation of the bills provisions, coordinate its investigations with the Department, and refer any suspected violations of law to the Attorney General. The Department states the bill may also create civil causes of action for any employees aggrieved by a violation of the whistleblower protections granted in the bill. The Department states that the various requests for cooperation and any associated action may increase expenditures. The Department cannot reasonably estimate the additional time required by its employees or the additional cases generated by the bill, so it cannot provide a more specific estimate of the expenditure increase.

    The New Hampshire Association of Counties and the New Hampshire Municipal Association state responses to the investigations called for in this bill may require additional county and local staff, depending on the volume and nature of the investigations. The Association of Counties states these investigations could also uncover waste, fraud, and misuse of public funds, leading to a decrease in expenditures to partially offset the expenditure increases.

    This bill does not contain an appropriation.