Every year, employers inquire as to what one initiative they should undertake to ensure that they are in compliance with labor and employment laws. This year, in addition to annually updating an employee handbook or employment policies, employers are presented with another initiative that they should undertake: ensuring familiarity and compliance with the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA or the Act), and the Department of Labor’s newly issued regulations.
USERRA is the Federal Law that governs the relationship between an employer and their employees in the uniformed services. To fully explain the parameters of that relationship, USERRA and the Department of Labor’s regulations address discrimination and retaliation, eligibility for reemployment, the rights and duties of individuals in the uniformed service, and the circumstances, terms and conditions under which individuals in the uniformed service shall be reemployed. Given the recent and dramatic increase in the number of individuals performing uniformed service, it is more important than ever for employers to comply with USERRA. Courts liberally construe USERRA, so employers should always err on the side of caution in dealing with issues involving employees serving in the uniformed services.
USERRA governs the treatment of individuals in the “uniformed service” of the United States. The definition of uniformed service is very broad, covering those serving in the Armed Forces, the Army and Air National Guards, or any other category of persons designated by the President during a time of war or national emergency. In short, the performance of duty in a uniformed service in all categories of military training and service, whether voluntary or involuntary, active or inactive duty, or in time of war or peace, is covered by USERRA.
Understanding the extent of USERRA’s coverage, we can now examine the substantive requirements of the Act. USERRA prohibits discrimination against an individual on the basis of their membership, application for membership, performance of service, application for service, or obligation for service in the uniformed services. Thus, employers may not deny initial employment, reemployment, retention in employment, promotion, or any benefit of employment to an individual on the basis of his or her involvement with the uniformed service. Similarly, employers are prohibited from retaliating against an individual in the uniformed service who invokes USERRA’s protections.
USERRA also governs the manner in which an individual must be “reemployed” after the completion of uniformed service. If an individual is absent from work due to performance of uniformed service, that individual will be entitled to reemployment rights under the Act so long as four conditions are satisfied:
1. The employer had sufficient advance notice of the employee’s uniformed service;
2. The employee has had five years or less of cumulative uniformed service while employed by the current employer;
3. The employee timely returns to work or applies for reemployment; and
4. The employee has not been separated from the uniformed service with a disqualifying discharge or under other than honorable conditions.
However, there are numerous exceptions and qualifications to each of these four requirements, which must be carefully observed by employers.
When an employee is returning to work, there are also considerable requirements as to the type of position in which the employee must be re-employed. The general rule under USERRA is the “escalator principle_ - requiring that an employee be re-employed in the position that he or she would have attained with reasonable certainty if not for the absence due to uniformed service. The escalator principle also applies to the employee’s rate of pay upon return from a period of uniformed service, meaning that the employee is entitled to compensation at the rate of pay associated with the “escalated” position.
USERRA also provides that an employee absent from work due to uniformed service is entitled to maintain seniority and seniority-based rights and benefits that the employee had on the date that uniformed service began plus any seniority and seniority-based rights that the employee would have accrued if he or she had remained continuously employed. A seniority-based right or benefit is one that accrues with, or is determined by, longevity in employment and is not a form of short-term compensation for work performed.
USERRA also requires that an employer continue to provide the employee with health care coverage. USERRA requires that, when an individual is performing uniformed service, the employee is entitled to continue health insurance for the employee and dependents (if the plan offers dependent coverage). Such continuing coverage must be provided for the lesser of: (a) 24 months from the date the employee begins an absence to perform uniformed service, or (b) the period from the date the uniformed service begins to the date that the employee fails to return to work or fails to re-apply for the position of employment after uniformed service has been completed. Similar to the continuing coverage requirements of COBRA, USERRA does not require that health coverage be continued if the employee did not participate in the employer’s health plan. Generally, the premium for the continuing health care coverage must be fully paid by the employee (like COBRA), though there are exceptions to this rule.
Finally, a very important aspect of the new Department of Labor regulations is the imposition of a posting requirement. As of January 18, 2006, all employers are required to provide a written notice to employees of their rights, benefits and obligations under USERRA. The regulations require that the written USERRA notice inform employees about an employee’s right to re-employment after uniformed service, the employee’s right to be free from discrimination or retaliation related to their uniformed service, the employee’s right to health insurance protection during uniformed service, and how an individual in the uniformed service can enforce their rights under USERRA. As part of its final regulations, the Department of Labor issued a sample poster which private sector employers may use to comply with the written notice requirement. USERRA requires that the notice be posted where employers customarily place employee notices.
Clearly, USERRA provides a broad scheme to protect the rights and benefits of those individuals serving in the uniformed service of the United States. With the recent issuance of the Department of Labor’s final regulations concerning USERRA, employers must be sure that they are carefully complying with the requirements of the Act and the regulations. Thus, ensuring familiarity with USERRA and the new regulations, as well as updating any employee handbook policies regarding the rights, benefits and obligations of those in the uniformed service, are key initiatives that every employer should complete in 2006.