United States troops are returning from Iraq, Afghanistan and other areas of conflict even as other reservists are being called up. As the deployment of military personnel likely will continue for some time, we thought a brief review of employer obligations under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA or the Act) would be useful. For a more detailed look at USERRA’s requirements, see our October 2001 Labor & Employment Law Update.
USERRA is intended to minimize the disadvantages to employees who are called for military service. The Act also encourages non-career military service by making it easier to return to civilian life after military service. The Act applies to all public and private employers, regardless of size or location, and is the primary federal law protecting the rights of the women and men who serve in the armed forces. USERRA provides the “floor” of benefits for employees – many states have laws that expand the scope of protection for veterans. If a state law provides greater benefits than USERRA, then it will govern.
Employers should confirm that their employment policies, including employee benefits policies, comply with all federal and state laws relating to the rights of employees who perform service for the armed forces.
Reemployment Obligations Under USERRA
An employer generally has a duty under USERRA to reemploy an employee who takes a leave of absence for military service. An employee who is called to military service qualifies for reemployment upon discharge from service if the employee (1) properly notified the employer of the need for a service-related absence; (2) takes a cumulative absence of no more than five years; and (3) properly reapplies or reports to work on a timely basis. An employee who is dishonorably discharged is disqualified from USERRA’s reemployment rights. Also, an employee may be disqualified if the employer’s circumstances have changed so that reinstatement is not possible.
Employers must abide by the Act’s “escalator principle.” The “escalator principle” mandates that returning employees be provided all the additional seniority, rights and benefits that they would have earned if they had been employed continuously during military service. In other words, a returning veteran must be reemployed in the job he or she would have attained had he or she remained at work, with the same seniority, status and pay.
USERRA also limits the employer’s ability to terminate an employee returning from military service. An employee may be lawfully terminated only “for cause” during the first year following reemployment if the military leave was for more than six months. If the leave was less than six months but more than 30 days, then the employer may terminate the employee only “for cause” during the first six months of reemployment.
Benefits
The employer also must protect the employment benefits of its employees while they are absent for military service.
An employee called to military service has the right to elect to continue the employer’s health plan coverage (including dependents) during the leave. If the employee elects not to continue the health benefits while on leave, he or she has the right to re-enroll in the health plan upon reemployment. Generally, no waiting period or preexisting condition exclusion period may be imposed upon the employee if none would have been applicable without the military leave.
USERRA also requires that a veteran be considered as not having incurred any “break” in service for the purpose of pension benefits. If the employee returns to work, military service is considered service with the employer for benefit accrual and vesting purposes. The employer must fund any resulting obligation.
Employers must be aware of the coordination of rights under USERRA and the Family and Medical Leave Act (FMLA). In determining whether a veteran meets the FMLA eligibility requirement, the months and hours that the employee would have worked but for military service must be added to the months and hours actually worked for the employer. If the total hours exceed 1,250 during a 12-month period, then upon return to work the employee would be eligible for FMLA leave for a serious health condition.
Employer’s Liability
Employers cannot discriminate against employees because of their military service obligations. For example, an employee who is denied reemployment following military service can bring an action against his employer for discrimination based solely on the employer’s failure to reemploy the employee. An employee who is denied a promotion or is terminated because of duties as a member of the National Guard can file an action against his employer for a violation of USERRA.
An employer violates USERRA when the employee’s military status is a motivating factor in the employer’s action against the employee, unless the employer proves that it would have taken the same action regardless of the employee’s military status. For an employee to prevail, he or she need only show that the employer was motivated in part by the employee’s military status. The employee does not need to show that military service was the sole reason for the employer’s discriminatory action. Employers must have legitimate, non-discriminatory reasons for taking employment actions against employees protected under USERRA.
As employees continue to be called for military service and as they return, an employer must be aware of its obligations under USERRA and any state laws. A review of these laws will help an employer advise its employees of their rights and will ensure that the employer avoids liability for failure to comply with its obligations.
Maureen Q. Dwyer
