USERRA - Uniformed Services Employment and Reemployment Rights Act

USERRA was signed into law on October 13, 1994 to replace and strengthen the Veterans’ Reemployment Rights Act (VRRA).  Under USERRA, employers cannot deny initial employment, reemployment, retention in employment, promotion, or any benefit of employment to an applicant/employee based on membership, application for membership, performance of service, application for service, or obligation for service in the uniformed services.

Key Definitions

Uniformed services include the U.S. Armed Forces, Public Health Service, National Guard, and reservists.  Covered service includes: voluntary or involuntary duty; active or inactive duty; active or inactive duty for training; initial active duty for training; and full-time Guard duty.

Coverage

All employers, regardless of number of employees or size, are covered.

And most employees are covered by the law’s anti-retaliation and anti-discrimination provisions, including temporary, part-time, probationary, and seasonal employees.  Even employees on strike, former employees, and potential employees are covered.

There are limited exceptions for coverage.  Independent contractors are not covered.  Also, employees are not entitled to reemployment rights if they work in positions that are for a brief, non-recurring period and for which the employees have no reasonable expectation of continued employment indefinitely or for a significant period; they are, however, covered by the anti-retaliation and anti-discrimination provisions.

Eligibility For Reemployment

In order to be eligible for USERRA protection, employees must meet these requirements.

• Employees must have left their jobs for the purpose of performing military service.
  
  
• Employees must provide adequate notice of their need for protected military leave.
  
  -- The employee or an appropriate officer must indicate the leave is based on uniformed service.
  
  -- The notice may be either written or verbal.
  
  -- The notice should be given in advance.
  
  
• The employee must not receive a dishonorable discharge.
  
  
• The position the employee originally held must not be temporary; the employee must have had a reasonable expectation that it would last for a significant amount of time.
  
  
• The cumulative length of an employee’s military leave must not exceed five years, unless:
  
  -- the service is required to complete an initial military obligation;
  
  -- the nature of the service requires a longer length of service (e.g., being at sea when the time limit is reached);
  
  -- the service is required training for reservists or National Guard members;
  
  -- the service is required for a domestic emergency, national security-related situation, war, or other national emergency;
  
  -- the individual was involuntarily called to active duty service after volunteering for service; or
  
  -- National Guard members are called into action by the President to suppress an insurrection, repel an invasion, or to execute the laws of the United States.
  
  
• The employee must return to work within a specific time period, depending on the duration of the individual’s military service, according to the following schedule.
  
  -- Service up to 30 days — By the beginning of the first regularly scheduled workday that falls eight hours after returning home from military service, allowing reasonable time for travel, rest, etc.
  
  -- Service of 31 to 180 days — No later than 14 days after completing military service.
  
  -- Service of 181 or more days — No later than 90 days after completing military service.
  
  -- Service-related injury or illness — The reporting and application deadlines are extended for up to two years for individuals who are hospitalized or convalescing because of a service-related illness or injury.
  
  Although the employee has to make a timely return and a timely application to get his/her job back, there is no mandated, standard form for such application, and it can be verbal or written.
  
  Note: If an employee doesn’t reapply in a timely manner, you can’t automatically delete him/her from your rehire list.  What you can do is apply the normal rules of conduct prescribed by company policy on absence from scheduled work.
  
  
• The returning employee must provide documentation, reflecting the evidence that the employee is applying for reinstatement in a timely manner; that the duration of service was permissible (i.e., didn’t exceed the five-year limit); and that the service discharge was appropriate.  The regulations list the types of documents that employees may provide — and that you must accept — to establish eligibility for reemployment.
  
  -- DD (Department of Defense) 214 Certificate of Release or Discharge from Active Duty;
  
  -- Copy of duty orders prepared by the facility where the orders were fulfilled carrying an endorsement indicating completion of the described service;
  
  -- Letter from the commanding officer of a Personnel Support Activity or someone of comparable authority;
  
  -- Certificate of completion from military training school;
  
  -- Discharge certificate showing character of service; and
  
  -- Copy of extracts from payroll documents showing periods of service.
  
  Note: If the documentation is late in being produced, misplaced, or lost in the bureaucracy, you can’t delay or deny reemployment by demanding documentation that doesn’t exist or is not readily available.

Denying Reemployment

There are limited circumstances under which you may defend your right not to offer reemployment to a service member.

• Your employer circumstances have changed so much that reemployment is impossible or unreasonable.
  
  Example: There has been a reduction-in-force that reasonably would have included the veteran.
  
  
• Helping the vet to become qualified for reemployment would pose an undue hardship.
  
  This exception applies only where a person is not qualified to perform essential functions of the position based on a disability or other bona fide reason.  Inability to perform one or two non-essential functions does not render the employee unqualified.  In order to provide regulatory consistency, the DOL adopted the Americans with Disabilities Act’s definition of “essential functions.”
  
  You are required to attempt reasonable efforts, such as training, to help the person become qualified before you can utilize this defense.  These efforts must be made available at no cost to the employee.
  
  To claim an undue hardship, you must be able to show that an action would require significant difficulty or expense in light of:
  
  
  1. the nature and cost of the action;
     
     
  2. the overall financial resources of the facility involved, number of employees at the facility, effect on expenses and resources, or impact otherwise on the operation of the facility;
     
     
  3. the overall financial resources of the employer, overall size of the business with respect to the number of employees, the number, type, and location of its facilities; and
     
     
  4. the type of operations of the employer, including composition, structure, and functions of the workforce.
     
     
• The service member held a “brief, non-recurrent job” prior to being called to military service.
  
  
• The service member’s reemployment documentation doesn’t pass legal muster.

When you don’t have any of these defenses and you must reemploy, make sure you do so in a prompt manner.  While USERRA final regulations don’t specifically define prompt, they offer guidance.  Basic rule of thumb: as soon as practical under the circumstances of each case.  Absent unusual circumstance, that means, according to the regs, within two weeks of the employee’s application for reemployment.  You can’t delay reemployment just because you hired someone else to fill the position, or because a hiring freeze is in effect.

Benefits And Compensation

USERRA demands that you treat service members as if they were on a leave of absence.  So if you offer certain non-seniority-based benefits to employees on non-military leave, you have to offer the same benefits to service members.  Whatever benefits were in effect when they left, must be continued.  And any new benefits that became effective during the period of service are also added to the employees’ benefits pot.  Similarly, the service member is responsible for any benefits costs that he/she would have normally paid while employed or to the extent that other employees on a leave of absence are responsible for such costs.  Military service must also be considered service with the employer for vesting and benefits accrual purposes.

If the non-seniority benefits to which employees on a leave of absence are entitled vary according to the type of leave, employees on military leave must be given the most favorable treatment accorded to any comparable form of leave.  The final regs provide guidance on factors to consider in determining whether two types of leave are comparable, including: duration of leave; purpose of the leave; and ability of the employee to choose when to take the leave.

The final regs also reflect the DOL’s view that the accrual of vacation leave is a non-seniority-based benefit.  If your policy for comparable leave does not provide for accrual of vacation benefits, then your military leave policy also does not have to provide it.

The final regs allow sick leave to be used if an employer allows employees to use sick leave for any reason, or if it is allowed for other similarly-situated employees on a comparable leave.

For plans starting on or after December 10, 2004, the Veteran’s Benefits Improvement Act of 2004 requires employers to provide continued health care coverage for up to 24 months to any employee who has been called to active military duty.  Before the Act was passed, the law required employers to offer up to 18 months of health care coverage to military reservists and members of the National Guard.

For military service of less than 31 days, the individual may only be required to pay the usual employee share of the premium.  If military service is longer than 31 days, the individual may be required to pay up to 102% of the full premium. 

Note: Reservists’ dependents are automatically eligible for government-provided health care through military hospitals and the Civilian Health and Medical Program for Uniformed Services (CHAMPUS) once service exceeds 30 days.

The regs expand on some of the more general USERRA guidelines dealing specifically with health care plans.  For example, while USERRA requires a health plan to offer COBRA-like coverage for absent employees in the service, it doesn’t offer procedures for electing or paying for such coverage.  The regs provide that health plan administrators may develop “reasonable requirements” for election and payments, as long as they are consistent with the plan’s terms.

The DOL added a new section to permit employers to cancel an employee’s health insurance if the employee fails to elect continuing coverage, with a requirement for retroactive reinstatement under certain circumstances.

Plans may develop reasonable rules to permit termination of coverage if an employee elects, but does not pay for, continuation coverage.  It is reasonable for COBRA-covered plans to adopt COBRA rules, as long as the plan complies with USERRA.

Voluntary contributions is another specific area on which the regulations seek to clarify issues.  They emphasize that employees must be allowed to make up all or part of any missed contributions or elective deferrals.  The final rules no longer contain the provision that required a plan to permit a person to continue to make up missed contributions or elective deferrals after leaving employment.  Makeup contributions or elective deferrals must be made during a time period starting with the date of reemployment and continuing for up to three times the length of the employee’s immediate past period of uniformed service, with the repayment period not to exceed five years.  Also, employees are neither permitted nor required to pay interest when making up missed contributions or elective deferrals.

The timing of employer contributions is also addressed by the regulations.  USERRA does not provide time frames for employer contributions.  The regs do.  They require that employer contributions that are not dependent on employee contributions must be made within 90 days following reemployment or when contributions are normally made for the year in which the military service was performed, whichever is later.  Plus, they require that matching contributions based on the returning employee’s make-up election deferrals must be in line with the plan’s requirements for the employer’s matching contributions.

USERRA does not require employers to continue paying employees who are activated for military service.  However, employees are entitled to be paid while on military leave once an employer puts such provisions in its policies or employee handbook.  While service members may use paid leave time that they accrued before taking military leave, they may not be forced to use it.

When considering whether merit or performance increases would have been attained with reasonable certainty if not for the employee’s military service, an employer may examine the employee’s work history and history of merit increases, and that of employees in the same or similar positions.

Military personnel remain responsible for their personal debts and obligations, such as child support, and, if necessary, their wages may be garnished.  Reductions of child support obligations generally have to be negotiated case-by-case.  Lenders must have a court order to declare default on a loan secured by a mortgage.

Seniority

USERRA requires that employees be reemployed in a position that reflects with reasonable certainty the pay, benefits, seniority, and other job perquisites they would have attained had they not gone into the service, but instead had remained in their previous positions.

One of the main issues covered in the regulations is the strict adherence to what has become known as the “escalator position.”  The Supreme Court first labeled it way back in 1946 when it said a returning service member “does not step back on the seniority escalator at the point he stepped off.  He steps back on at the precise point he would have occupied had he kept his position continuously during the war.”

The entire period of absence necessitated by service in the uniformed services, including preparation and recuperation time, is considered service with the employer for computation of seniority and seniority-based rights, including pension entitlement.

From an employer’s viewpoint, the regulations do cut both ways in the escalator concept.  The Act does not prohibit lawful adverse circumstances from befalling an employee based on that restoration on the seniority ladder.  The law does not require you to put the employee in a better position than if he/she had remained on the job.

An employer is allowed to take into account any factors that would have affected the status of the employee if he/she had remained in the job, including opportunities for advancement, working conditions, job location, shift assignment, rank, responsibility, and geographic location.  So the reemployment can legally involve what seems like a negative action (e.g., transfer to another shift or location, more or less strenuous working conditions, changed opportunities for advancement) depending on what likely would have happened to the employee if he/she hadn’t left.

 

Protection From Discharge

Reemployed individuals may not be discharged without cause for a certain period of time, depending on length of military service.

1. Service up to 30 days — No protection from discharge without cause, but are protected from discrimination based on military service or obligation.
   
   
2. Service of 31 to 180 days — Six months after the date of reemployment.
   
   
3. Service of six months or more — One year after the date of reemployment.

Record-Keeping Requirements

Effective March 10, 2005, the Veteran’s Benefits Improvement Act of 2004 requires all employers to post a notice informing employees covered by USERRA of their rights, benefits, and obligations under the Act.  The notice must be posted where employers customarily place employment notices for employees.

The final regs did not change the requirement to provide a notice of rights and duties under USERRA.  But now there are separate notices for private sector and state government employers and for federal executive agencies.  The final text varies only slightly from the proposed version.  Both notices now reference protection for members of the National Disaster Medical System, which is the only USERRA-covered service not contained in USERRA itself.

The DOL did not provide additional guidance on the requirement that a notice be posted “where employee notices are customarily placed,” as it did not want to “unduly restrict the use of all alternatives by sanctioning some but not others.”  Instead, employers should “use their best judgment and discretion.”

USERRA notices may be obtained from the DOL’s Veterans Employment and Training Service, which is authorized to investigate and resolve complaints of USERRA violations.

 

 

Back To USERRA Main Page