As our country prepares for war, employers may be faced with the question of how to deal with employees who may volunteer for or be called to active duty.
What is your obligation to provide leave to these employees? Under what circumstances and for how long are you required to reemploy them? And what rights do they have to continue participating in your benefit plans while they are on leave? These and many other questions are answered by the Uniformed Services Employment and Reemployment Rights Act (USERRA), the federal law requiring employers to grant unpaid leave to employees who are members of or enlist in one of the armed services.
Leave Requirements
The USERRA generally requires you to grant up to five years of unpaid leave to employees who belong to or join the military. To qualify for protection under the USERRA, an employee must give you a certain amount of advance notice that he or she will be leaving for military service. But note that as a practical matter, the exceptions to this notice requirement are so broad that you will rarely be able to claim that an employee forfeited his or her USERRA rights by failing to provide adequate notice.
In some ways, the USERRA is similar to the more familiar Family and Medical Leave Act (FMLA). But the USERRA provides far broader protections than the FMLA. In addition to providing five years of unpaid leave (compared to only 12 weeks of annual leave under the FMLA), all employers must comply with the USERRA regardless of how many employees they have (compared to the FMLA, which applies only to employers that have at least 50 employees). However, you may be required to provide even more than five years of leave in certain circumstances.
Reemployment Requirements
Simply put, when an employee returns from military duty and asks to be reemployed, you have to take him or her back if the employee reapplies for employment within certain deadlines specified in the USERRA and has taken less than five years' total military leave (but keep in mind that there are certain exceptions to this five-year limit)
But what job is that employee entitled to? The USERRA says you must return employees to the job they would have had if they had not taken any military leave. If an employee comes due for a promotion while on military leave, you must give him or her that promotion upon reemployment. This is commonly referred to as the "escalator" position.
There are some exceptions to this general requirement which depend on whether the employee's leave lasts more or less than 90 days and whether he or she is (or can become) capable of performing the essential tasks of a particular position.
Employees who served less than ninety-one days must be reemployed in the position that they would have attained if they had been continuously employed, if the they are qualified or can become qualified for the job. If the individual is not qualified for that position, the individual must be reemployed in the position he or she left prior to military service or in a position that is the nearest approximation of that position. An employer may not offer "other jobs" of equivalent status.
Employees who served ninety-one or more days must be reemployed in a position that they would have attained if continuously employed if they are qualified or can become qualified for the job. If the employee is not qualified, the employer must reemploy the employee in his or her former position, or in a position of equivalent seniority, status, and pay, or if these options fail, in a position of "like status" for which they are qualified.
Finally, you cannot fire employees who return from military leave for a specified period of time after the leave ends. The duration of this prohibition depends on the length of the employee's leave (generally, whether it is more or less than 180 days).
Requirements Relating to Employee Benefits
The USERRA prohibits you from requiring employees who take military leave to forfeit any benefits they have already accrued under your retirement plan or to requalify for participation in the plan upon returning from leave. Employees must continue to vest and accrue benefits under your retirement plan as if they were still working for you. For example, you must make the same contributions to the employee's retirement plan that you would have made if the employee had not been absent on military leave.
In addition, the USERRA also requires that you provide health continuation coverage to employees who take military leave. This requirement is practically identical to the requirements imposed by the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA). You must allow employees who take more than 30 days of military leave to continue coverage on your health plan -- at the employee's expense -- for up to 18 months. But unlike COBRA, the USERRA does not exempt small employers from this requirement.
When employees return from military service, they are entitled to health insurance benefits as if they had not taken any leave at all. This means that you cannot, for example, impose a waiting period or preexisting condition exclusion before those employees or their dependents are fully covered under your group health plan (other than waiting periods or exclusions that would have applied anyway). But you are allowed to impose such conditions to coverage when an employee's illness or injury is incurred during or aggravated by his or her military service.
Some Final Thoughts
It's important that you and your company have a good understanding of your obligations under the USERRA. In 1998 alone, the Department of Labor (DOL) opened 1,051 new cases in which returning members of the armed forces charged their employers with violations of the Act. The number of USERRA claims filed with the DOL can be expected to rise as more employees depart for and eventually return from global hot spots. Understanding your basic obligations under the USERRA can help you make sure that your company stays out of hot water.
For more information contact Jude Biggs at 303-473-2707 or jbiggs@hollandhart.com.