Amendments to USERRA
[The following was emailed as a newsletter to my clients.]
23 November 2010
Congress recently passed three important USERRA amendments that will benefit employees who are members of the military reserves or returning veterans. The Veterans’ Benefits Act of 2010 (H.R. 3219) clears up a couple of problems in the wording of USERRA. First, it makes clear that USERRA prohibits wage discrimination against servicemembers; and, second, that a multi-factor test applies in all cases in which a successor employer’s coverage is disputed. President Obama signed the bill on 13 October. (When he was a senator, President Obama had co-sponsored a bill containing these two amendments.)
What’s USERRA? The Uniformed Services Employment and Reemployment Rights Act protects those in the Reserves or Guard, as well as on active duty. It provides for the right to return to prior employment after a tour of military service and forbids discrimination against civilian employees because of their military service or obligation. For more information on USERRA, check the websites of the Department of Labor or the Department of Justice.
Salary discrimination now prohibited. When Congress adopted USERRA in 1994, the Act included a prohibition on discrimination against servicemembers by withholding a “benefit of employment.” The term “benefit of employment” was defined to exclude “wages or salary for work performed.” Basically, someone made a mistake in drafting. The legislative history describes this exclusion as covering “wages or salary for work not performed while absent from employment.”
In 2002, this definition cost someone some money. William Gagnon brought suit against Sprint Corporation, claiming that he was paid less than similarly experienced employees because of his military service. The courts ruled against his claim because of the definition of “benefit of employment.” Gagnon v. Sprint Corp., 284 F.3d 839 (8th Cir. 2002).
The Veterans’ Benefits Act corrects the definition by including “wages or salary for work performed” as a benefit of employment.
Successor employers defined – again. If an employee takes leave to go on active duty and his employer has been bought out, merged, or whatever by the time he or she returns, is the successor employer responsible for rehiring the servicemember? When this question came up in a case under the predecessor to USERRA, the Eighth Circuit listed seven factors to be considered. Leib v. Georgia-Pacific Corp., 925 F.2d 240 (8th Cir. 1991). Congress mentioned the Leib case in the Congressional reports supporting the passage of USERRA, and the Department of Labor’s USERRA regulations used the same seven factors. But prior to the adoption of the regulations, the Eleventh Circuit decided that an additional factor had to be considered – whether there was a merger or a transfer of assets. Coffman v. Chugach Support Services, Inc., 411 F.3d 1231 (11th Cir. 2005). Congress hopefully clears up the confusion by putting the Leib factors into USERRA.
Amendments effective now. Each of these amendments includes a provision that the amendments to USERRA applies to any violation of USERRA “that occurs before, on, or after the date of enactment.” It also applies to any claims “that are pending or after the date of the enactment.”
Federal employees’ claims. The VBA sets up a 3-year “demonstration project” so that certain USERRA claims against Federal executive agencies would be received by or referred to the Office of Special Counsel. It would also allow the Office of Special Counsel to receive and investigate certain claims under USERRA and related prohibited personnel practice claims. The Office of Special Counsel is an independent federal investigative and prosecutorial agency, with authority under four federal statutes: the Civil Service Reform Act, the Whistleblower Protection Act, the Hatch Act, and USERRA. There was a similar demonstration project a few years ago, but Congress allowed it to expire at the end of 2007.
Kathryn Piscitelli and I helped in the drafting of the USERRA provisions of the VBA along with the staffs of Representative Artur Davis and the late Senator Edward Kennedy.