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Ms. Pohlid

Hospitality Law

Veterans Re-employment Rights Synopsis

By Kathleen Pohlid, Founder and Managing Member, Pohlid, PLLC

The Uniformed Services Employment and Reemployment Act 1994 (USERRA) was enacted to provide service members with reinstatement rights in their civilian jobs and to protect them against discrimination because of their uniformed service. The goal of USERRA is to ensure that service members do not suffer a loss or incur discrimination in their civilian jobs because of their service. USERRA also seeks to put the employee back into the place they would have been in their civilian job "but for" the interruption due to their service. Employers must be aware of their obligations and employee rights under USERRA.

USERRA provides employment, reemployment and anti-discrimination rights to employees who serve in the uniformed services. It also imposes certain requirements upon employers. USERRA applicability is based upon whether the individual has served or sought to serve in the uniformed services or exercised a right under USERRA, whether the employer is a "covered employer", whether the employee has satisfied their requirements to invoke USERRA protections, and whether an affirmative defense applies.

Uniformed Services

USERRA protections and rights apply to "service in the uniformed services," which is defined to include reservists serving in the military, active duty military, members of the National Guard under Federal authority, specified service by members of the National Disaster Medical System, and service in the commissioned corps of the Public Health Service. It also applies in times of peace and war and irrespective of whether the individual is serving voluntary or involuntary.

Covered Employers

All public (to include states and their political subdivisions) and private employers, regardless of size, are covered by USERRA. Additionally, USERRA coverage also applies to foreign employers doing business within the United States (to include its territories and possessions). U. S. companies operating in a foreign country are also required to comply with USERRA, unless doing so would violate the law of that foreign country.

Employers may also be liable as a successor in interest for USERRA violations committed by their predecessors even if the employer has no knowledge of the claim. Such liability is based upon the determination as to whether "there is a substantial continuity in operations, facilities, and workforce from the former employer." 20 C.F.R. § 1002.35.

Although USERRA applies to all employees of an employer including executive, managerial, and professional employees, it does not apply to independent contractors. The issue as to whether an individual is an "employee" or an "independent contractor" is determined based upon a variety of factors including the following:

(1) The extent of the employer's right to control the manner in which the individual's work is to be performed;
(2) The opportunity for profit or loss that depends upon the individual's managerial skill;
(3) Any investment in equipment or materials required for the individual's tasks, or his or her employment of helpers;
(4) Whether the service the individual performs requires a special skill;
(5) The degree of permanence of the individual's working relationship; and
(6) Whether the service the individual performs is an integral part of the employer's business.
20 C.F.R. § 1002.44(b)

Employment Benefits

Employers should review their employee benefits to be aware of their obligations and consult with counsel as to ensure compliance with USERRA regulations. USERRA provides that employees will not be denied employment benefits (including among other benefits, health care, pension, and sick and vacation leave) because of their service. Employees are entitled to the same non-seniority rights and benefits provided to similarly situated employees under the terms of employment. For example, if an employer provides accrued vacation leave to similarly situated employees on a comparable leave of absence, the employer is required to extend the same benefit to the employee on military leave. 20 C.F.R. § 1002.151.

Employees who have health plan coverage as part of their employment must be permitted to continue coverage for specified periods as set forth in the regulations at 1002.164. Employees are not required to pay more than their required share if the period of their service is less than 31 days. However, if the period is more than 31 days, the employee may be required to pay no more than 102% of the full premium under the plan. The regulations also set forth certain requirements for employers with respect to notice of continuing coverage. 20 C.F.R. § 1002.167.

Anti-Discrimination

USERRA prohibits employers from discriminating against an individual based upon their membership or application for membership in a uniformed service. This prohibition includes protection from denial of employment benefits, reemployment, and retention in employment. Additionally, employers are prohibited from taking any adverse employment action against individuals for exercising their rights under USERRA or for assisting or participating in a proceeding or investigation under USERRA.

In order to establish a discrimination claim under USERRA, the individual must show that the employer took an adverse employment action against them and that one or more of the following was a motivating factor for the employer's adverse action:

(1) The individual's membership or application for membership in a uniformed service;
(2) The individual's performance of service, application for service, or obligation for service in a uniformed service;
(3) The individual took action to enforce a protection afforded any person (including but not limited to the individual filing the claim) under USERRA;
(4) The individual gave testimony or a statement in or in connection with a USERRA proceeding;
(5) The individual provided assistance or participated in a USERRA investigation; or,
(6) The individual exercised a right provided for by USERRA.

30 C.F.R. § 1002.22(a). If an individual has met their burden to establish a USERRA violation, then the employer may avoid liability through evidence establishing "the affirmative defense that action would have been taken anyway absent the USERRA-protected status or activity." Id.

Claim for Failure to Provide Reemployment

Employees who seek, but do not obtain reemployment upon their return from service, may also file a claim for a USERRA violation. The employee bears the burden to establish that they were absent from their position of employment due to their service in the uniformed services and that they satisfy each of the following criteria:

  • The employer received advance notice of the employee's service. Such notice may be given verbally or in writing by either the employee "or an appropriate officer of the uniformed service in which his or her service is to be performed." 20 C.F.R. 1002.85. The regulations do not specify a minimum period of notice but recommend notice of at least 30 days prior to departure when it is feasible and require that the notice be provided "as far in advance as is reasonable under the circumstances." Id. The only exception is when giving notice is prevented by military necessity or it is impossible or reasonable under the circumstances.
  • The employee has five years or less of cumulated service in the uniformed services with respect to the particular employer. This limit includes only periods during which the employee actually spends time performing service in the uniformed services. It excludes time when the employee is traveling to report for service or time spent to prepare for returning back to employment. Additional exceptions may also apply based upon the circumstances involving the employee's service or training in the uniformed services.
  • The employee timely returned to work or applied for reemployment. The timeliness is determined based upon the length of the period of service performed. Unless it is impossible or unreasonable for the employee to do so, they must report back or apply for reemployment as follows:
    • a. If the period was less than 31 days, the employee must report back "no later than the beginning of the first full regularly scheduled work period on the first full calendar day following the completion of the period of service, and the expiration of eight hours after a period allowing for safe transportation from the place of that service to the employee's residence." 20 C.F.R. § 1002.115.
    • b.If the period of service is more than 30 days but less than 181 days, the employee must apply for reemployment within 14 days. The application may be either verbal or written.
    • c. If the period of service is morn than 180 days, the employee must apply for reemployment within 90 days after completing service.

      The above periods are also extended if the employee is recovering from an injury occurred in or aggravated during their service. Employees who fail to timely report for reemployment are subject to the employer's rules of conduct and policies for absences. Additionally, employees who seek or obtain alternative employment during the interim do not forfeit their rights to obtain reemployment. However, this provision does not preclude employers from enforcing prohibitions against employees from working for a competitor.
  • The employee was not separated from service with a disqualifying discharge or under other than honorable conditions. The employer may request that the employee provide documentation to confirm that this requirement has been met. However, employers are not permitted to delay or deny reemployment if such documentation is not readily available.

Claim for Failure to Provide Reemployment

Employees who seek, but do not obtain reemployment upon their return from service, may also file a claim for a USERRA violation. The employee bears the burden to establish that they were absent from their position of employment due to their service in the uniformed services and that they satisfy each of the following criteria:

Layoff, Strike or Leave of Absence

Employees retain their USERRA rights during a layoff, strike or leave of absence. As noted above, the guiding principle under USERRA is that employees are not to incur a disadvantage with respect to their civilian employment because of their service in the uniformed services. This principle does not protect employees against adverse actions that would have occurred if they had remained in their civilian employment. Additionally, "[r]eemployment rights under USERRA cannot put the employee in a better position than if he or she had remained in the civilian employment position." * 20 C.F.R. § 1002.42(c)*. Applying this principle, an employee who is laid off when they begin their military service may be entitled to reemployment "if the employer would have recalled the employee during the period of service." 20 C.F.R. § 1002.42(a). If the employee receives a recall notice during this period, they are entitled to reemployment following their return from service even if they did not respond to the recall notice. 20 C.F.R. § 1002.42(b).

Affirmative Defenses

Employers may avoid liability for a USERRA violation if they establish evidence to support any of the following affirmative defenses:

  • Change of Circumstances Affirmative Defense
    Employers may be excused from reemploying a service member if there has been a change in circumstances which makes reemployment impossible or unreasonable. For example, this may occur if the employer has had a reduction in workforce and the employee would not have retained their job if they had remained at work.
  • Brief, Nonrecurrent Employment Affirmative Defense
    The USERRA reemployment provisions apply to temporary, part-time, probationary and seasonal employment. However, employers may avoid liability if the position which the employee held before they left to serve in the uniformed services was: (1) for a brief, nonrecurrent period; and (2) there is no reasonable expectation that the employment would have continued indefinitely or for a significant period. This is an affirmative defense which employer bears the burden to establish. Therefore, establishments should consider documenting in the job postings when the position is for a brief, nonrecurrent period and the position is not expected to continue.
  • Undue Hardship Affirmative Defense
    Employers are not required to reemploy the service member if it establishes that doing so would pose an undue hardship or "an action requiring significant difficulty or expense." The determination of an undue hardship is considered based upon the following: the nature and cost of the action needed; the overall financial resources of the facility or facilities involved; the number of persons employed by such facility or facilities; the effect on expenses and resources; the impact on facility operations; the overall financial resource of the employer; the overall size of the employer's business with respect to the number of its employees; the number, type and location of its facilities; and the type of operation or operations of the employer.

Terms of Reemployment

Under USERRA, an employer is obligated to provide "prompt" reemployment, which means "as soon as practicable under the circumstances." USERRA also applies the escalator principle to the terms of reemployment. Under this principle, the employee obtains the employment position that they would have been in "but for" their departure for military service. This may mean a promotion for seniority, or a transfer or lay off.

Additionally, the employee must be qualified for the position. However, the employee's inability to perform one or more non-essential tasks will not disqualify them for the position. Employers may be required to provide the employee with additional training and to make reasonable accommodation for the employee if they are returning with a disability.

Protection Against Discharge

After an employee who served more than 30 days is reemployed, USERRA provides them with protection during a limited period of being discharged for reasons other than "for cause." If the employee served for more than 30 but less than 181 days, the period of this protection is 180 days after the date of reemployment. If the employee served for more than 180 days, they are protected for one year from reemployment. 20 C.F.R. § 1002.247.

USERRA Claims

Individuals who believe that their USERRA rights have been violated may initiate legal action or contact the Veterans' Employment and Training Service (VETS) for assistance. VETS, which is a part of the U. S. Department of Labor (DOL), is tasked with assisting veterans and enforcing USERRA. If VETS determines that the employer has committed a USERRA violation, it will attempt to resolve the complaint with the employer. If VETS is unsuccessful, it may refer the claim to the Attorney General for legal action or the employee may institute a private action. Although USERRA does not set forth a statute of limitations or period by which a complaint may be filed, employers may assert equitable defenses for instances when unreasonable delays result in a prejudice to their defense.

Notice of Rights & Obligations under USERRA

Employers are required to provide notice to employees of their USERRA rights. Such notice may be given by posting in the location where employee notices are customarily placed. The regulations also permit employers to provide the notice "in other ways that will minimize costs while ensuring that the full text of the notice is provided (e.g., by handing or mailing out the notice, or distributing the notice via electronic mail)."

Employer Liability for Supervisory Discrimination

In addition to providing the required notice to all employees. Establishments must establish equal employment opportunity (EEO) and anti-discrimination policies prohibiting discrimination against veterans. Employers should also ensure that employee grievance procedures are established so that any incidents of discrimination can be promptly identified, investigated, and appropriate action taken.

It is critical that supervisors at all levels are aware of the EEO and antidiscrimination policies and the employer's expectation of their compliance. Employers may be held liable for discriminatory action initiated by lower level supervisors against individuals because of their military service even if they are not aware that such animus exists. Therefore, it is important that a strong non-discrimination policy is communicated to all levels of management.

In Staub v. Proctor Hospital, 131 S. Ct. 1186 (2011), the Supreme Court addressed a situation in which an employee was terminated following adverse employment actions initiated by two lower level supervisors who were motivated by animus towards the employee's military service. However, although those supervisors were alleged to have fabricated corrective actions based upon their hostility, they did not make the ultimate decision to terminate the employee. The employer argued that it did not violate USERRA because the person making the termination decision did so without any animus for his military service. The Supreme Court rejected this argument and upheld the jury verdict awarding the employee $57,640 in damages, holding that "if a supervisor performs an act motivated by antimilitary animus that is intended by the supervisor to cause an adverse employment action, and if that act is a proximate cause of the ultimate employment action, then the employer is liable under USERRA."

The above synopsis of USERRA regulations is not a substitute for establishments consulting with counsel to ensure workplace policies and procedures are in place. Do not wait for a USERRA issue to arise. Instead, ensure compliance with USERRA notice obligations, that EEO and antidiscrimination policies addressing veterans and the uniformed services are implemented and enforced, and that employment benefits and other policies are in compliance with USERRA.

Kathleen Pohlid is the founder and managing member of the law firm of Pohlid, PLLC in the Nashville, Tennessee area. She advises business clients in matters including employment, occupational safety and health, Americans with Disabilities Act (accommodation & discrimination) and regulatory compliance. Her goal is to enable clients to comply with the myriad of state and federal laws to succeed in their business, mindful of the challenges facing businesses and the importance of cost effectiveness. She has advised and represented businesses in a variety of industries including restaurants, hotels, and other entities in the tourism and hospitality industries. She has over 20 years of combined federal government and private sector experience in employment law and litigation. She holds an AV® rating from Martindale-Hubbell (highest for professional competency and ethics), a B.S. degree from the U.S. Naval Academy and a J.D. from Samford University. Ms. Pohlid can be contacted at 615-369-0810 or kpohlid@pohlid.com Please visit http://www.pohlid.com for more information. Extended Bio...

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