Reed Group Blog

Home » 2012 » March

Monthly Archives: March 2012

What Is Your USERRA IQ?

By Martha J. Cardi; Reed Group Chief Compliance Officer

How much do you know about USERRA?  With anticipated returns of United States military personnel to the civilian workforce, every employer should brush up on this important law.  Here are some questions and answers that every employer should know regarding USERRA.

USERRA is administered by the U.S. Department of Labor’s Veterans’ Employment and Training Service (VETS).

What are 3 key things an employer should know about USERRA?

  1. An employee’s right to take a leave of absence for military service is nearly absolute (See Questions 6, 7, and 8).
  2. An employer cannot require that the employee provide documentation before the leave or status reports during the leave (See Questions 6 and 8).
  3. The service member’s right to reinstatement is also nearly absolute as long as the service member reports back to work within the applicable time frame (See Questions 8, 9, 11, 13, and 14).  

1. What is USERRA?  What does “USERRA” stand for?  

USERRA, the Uniformed Services Employment and Reemployment Rights Act, provides protected leave of absence and rights to reemployment for individuals who leave their jobs to serve in the uniformed services (Army, Navy, Air Force, Marines, Coast Guard, National Guards, and others). 

“Service” includes voluntary or involuntary active duty, training, full-time National Guard duty, fitness examinations, funeral honors duty, and duty performed by intermittent employees of the National Disaster Medical System (part of Homeland Security). (20 C.F.R. §§ 1002.54 – 1002.62).

USERRA is administered by the U.S. Department of Labor’s Veterans’ Employment and Training Service (VETS).

2. What is the key difference between military-related leaves protected by USERRA and by FMLA ? 

USERRA provides job-protected leave of absence for the military service member to fulfill military obligations.

FMLA provides job-protected leave of absence for the family members of military service members—for exigencies (circumstances) related to deployment or to care for a relative injured in service.

3. How many employees must an employer have to be covered by USERRA?

USERRA covers ALL employers, so the employer only needs one employee to be covered. (20 C.F.R. § 1002.34).

4. How long does the employee have to be employed by the employer to be entitled to USERRA-protected leave?

No minimum length of employment is required under USERRA.  An employee is entitled to USERRA protection from the first date of employment. (20 C.F.R. § 1002.32).

5.  Can an employer refuse to hire a job applicant because he or she is in the National Guard or a Reserve unit? 

USERRA provides protection from job-discrimination because of past, current, or future military obligations, including employees who have applied for military service but aren’t yet in the service.  USERRA nondiscrimination protection extends to hiring, promotion, reemployment, termination, and benefits.(20 C.F.R. Subpart B).

6. What must the employee provide to the employer to be entitled to USERRA military leave?

An employee does not have to give an employer any paperwork when requesting USERRA leave.  This means that the employee doesn’t even have to show enlistment papers or orders to service upon taking USERRA leave. An employee must give “advance” notice as is reasonable under the circumstances, but USERRA does not specify how much notice.  The employee’s notice can be verbal or written. 

NO notice is required if military necessity prevents giving the notice, or if giving notice is otherwise “impossible or unreasonable”.

Notice may be given by the individual or by a military officer [and the employer should also accept notice from a family member]. (20 C.F.R. §§ 1002.85 – 1002.88).

7.  How long following notice of an employee’s upcoming military service does the employer,  or an administrator such as Reed Group, have to send a determination letter approving or denying the leave?

Trick question! An employer, and therefore its administrator, is not required to send an approval, denial, or notice because military leave is an absolute right that cannot be denied by the employer.  So, if employer WANTS to send a notice of rights, it can but is not required to and there is no time limit.

Nonetheless, it is a good practice to send notice to acknowledge the leave and to advise the employee of USERRA issues such as deadlines to report back to work from service, or any company military service benefit. This is beneficial to the employee, and makes a record in the employee’s file for the employer’s purposes.

8. Is an employee entitled to job restoration under USERRA?  

Yes, an employee returning from USERRA leave is entitled to job restoration. Dishonorable discharge and a few other negative circumstances will disqualify an employee from reemployment rights (e.g., court martial, having gone AWOL, or being imprisoned by a civilian court. (20 C.F.R. §§ 1002.134 – 1002.138).

There are no USERRA requirements as to where the employee has served or that the employee keeps the employer notified of status.

9.  What is the duration of job protection provided by USERRA for an employee on military leave?

An employee can serve in the military for 5 cumulative years and still retain job protection and reemployment rights with the employer..   Many exceptions swallow the rule:

  • Required training for Reservists and National Guard, including two-week annual training and weekend drills.
  • Active duty by volunteers (e.g., Reservists) supporting operational missions—examples include reservists ordered to service in Iraq or Afghanistan
  • Service ordered due to various national emergencies.
  • Service members involuntarily retained on active duty beyond expiration of the 5-year period
  • And many more exceptions.

(20 C.F.R. §§ 1002.99 – 1002.103).

10. Can an employer require an employee to use vacation time or paid sick leave for short leaves for military training?

No, the employer must allow the employee to use accrued paid vacation at the beginning of leave instead of unpaid leave, but cannot require the employee to do so. (20 C.F.R. § 1002.153).  Outside of the use of any accrued paid vacation, USERRA is unpaid leave. Many companies provide military service benefits such as pay differential.

11. Upon return to work is the service member employee entitled to the same position the employee held when leave commenced, or to an equivalent position with equivalent benefits, pay, and other terms and conditions of employment?

It depends.  An employer must apply the “escalator” principle to provide the employee with reemployment in the position and with the seniority and benefits she WOULD HAVE ATTAINED if she had remained continuously employed, and is required to provide training to qualify the returning employee for that position if the employer would provide similar training to other employees.  So, the position upon return MIGHT be the same if the escalator principle does not require promotion or an increase in compensation or other benefits.

The concept of an “equivalent position” is found in the federal Family and Medical Leave Act (FMLA) and not actually a concept found in USERRA.  Under USERRA, an employee must be reemployed to his original position or perhaps a better one, based on the “escalator” concept.

The USERRA reemployment rules are very complicated and depend to some extent on how long the employee was on service leave.  (29 C.F.R. §§ 1002.191 – 1002.199).

12. Must an employer continue health insurance coverage for an employee on USERRA leave?

During the first 30 days of military leave health insurance continues as during employment.  The employee cannot be required to pay more than the normal employee share of the premium during this period.

After 30 days, the service member employee may continue his health insurance for up to a total of 24 months of absence by paying not more than 102 percent of the full premium (a COBRA–like coverage).  This coverage extends for the period of service plus the time allowed to apply for reemployment, not to exceed 24 months.

NOTE:  Some health insurance plans will not cover an individual during military service.  The US government provides insurance through TriMet.  However, USERRA does not limit the employee’s ability to continue insurance to his dependents only.  This will allow the employee to have coverage following return from service and before reemployment.

Upon reemployment, there is generally no waiting period or exclusion for reinstatement of the employee’s health coverage. (29 C.F.R. §§ 1002.163 – 1002.171).

13. How many days does an employee have to apply for reemployment following the completion of military leave?

When an employee returning from USERRA leave must apply for reemployment will depend on length of military service:

Service of 1 to 30 days:  employee must report back to work at the beginning of the calendar work day following completion of service, after allowance for safe travel home and an 8 hour rest period.

Service of 31 to 180 days:  An application for reemployment must be submitted within 14 days after completion of service.  This may be extended in extenuating circumstances.

Service of 181 or more days:  An application for reemployment must be submitted within 90 days after completion of service. (20 C.F.R. § 1002.115).

USERRA requires the employer to provide “prompt” reemployment, which depends upon the circumstances of each individual case.  20 C.F.R. §§ 1002.180 – 181). The longer the absence, the more time the employer might require to determine the correct position and/or give notice to another employee who must vacate the position to which the service member is entitled.  This might mean that an employer may be required to “evict” a current employee from his position to make way for the returning service member.

If an employee is injured or disabled during military service, the period of time during which an employee must apply for reemployment is extended. Initially there is a 2-year limit if the employee is hospitalized or convalescing during the period following military service, but this can be extended if circumstance beyond the employee’s control makes reporting impossible or unreasonable.  The extension is for “the minimum time required to accommodate” the specific circumstance. (20 C.F.R. § 1002.116).

14.  When the employee applies for reemployment following return from service, what, if anything, can the employer require of the employee as a condition of reinstatement?

If the employee has been absent for service for 31 days or more, the employer can require documentation (usually discharge papers but this is not specified) that establishes that:

  • The employee’s application for reemployment is timely (based on length of service/absence from work); [See Q 13 above.]
  • The person has not exceeded the five-year service limitation [after taking into consideration the many exceptions]; and
  • The person’s separation from service was not under a disqualifying circumstance such as dishonorable discharge.  [See Q 7 above.]

If the employee was absent for service for 30 days or less, the employer cannot require any documentation upon return.(20 C.F.R. § 1002.121).

15. What if the employee misses the deadline to report to work or apply for reemployment?

An employee who missed the deadline to report to work or apply for reemployment is subject to the employer’s rules regarding unexcused absences.  (20 C.F.R. § 1002.117).

For example, if the returning service member misses the deadline for application for reemployment (based on her length of service) by 5 working days, the employer can refuse to rehire the service member if the employer’s usual attendance policies (as written and as enforced) would allow termination of another employee who had 5 unexcused absences.  If the employer allows 10 unexcused absences during a year before termination, the returning employee would have 5 absences on her record but the employer could not refuse to rehire her due to reporting back late.

16. When an employee returns from military leave, does she return to “employment at will” status?

 USERRA provides that a returning service member may not be discharged without cause:

  • For one year after the date of reemployment, if the military service was for more than 180 days
  • For six months after the date of reemployment, if the military service was for 31 to 180 days
  • Persons who serve for 30 days or fewer are not protected from discharge without cause, but they are still protected from discharge or other adverse employment action based on military service.

(20 C.F.R. § 1002.247)

17.  What is an employee’s FMLA entitlement upon return to work from military service?

An employee returning from military service is entitled to the same FMLA entitlement as if they had continued working and not taken USERRA leave.  The employee still must meet overall 12 months/1250 hours requirements, but military service counts toward these.

One small difference:  if an employee has a break in service of longer than 7 years, the separate periods of service are not added to satisfy the total 12 months of service for FMLA eligibility UNLESS the break in service is caused by the employee’s National Guard or Reserve military service obligation. (29 C.F.R § 825.110(b)(2)(i) and (c)(2)).

18. Where can I get more information?

The Veterans’ Employment and Training Service, has a guide entitled “A Non-Technical Resource Guide to the Uniformed Services Employment and Reemployment Rights Act (USERRA)” which was most recently published in April 2005. The 2005 publication is still current and can be found at: http://www.esgr.org/Site/LinkClick.aspx?fileticket=njA5ZaoUY5k%3D&tabid=178

The U.S. Department of Labor also has the following information and links: http://www.dol.gov/vets/programs/userra/

The Equal Employment Opportunity Commission has the following Guide for Veterans:

http://www.eeoc.gov/eeoc/publications/ada_veterans_employers.cfm

 


Red Flags: Legal Action Reveals FMLA Land Mines

Contributed article from Martha Cardi: Reed Group Chief Compliance Officer, featured in @work Magazine.

Legal action can uncover egregious errors and put yesterday’s “best practices” on the no-no list, raising red flags to guide employers around FMLA land mines.

The litigation or settlements in this article have generated substantial buzz among employee benefits professionals. Some will be covered in-depth at DMEC’s 2012 FMLA/ADAAA Employer Compliance Conference in Minneapolis on April 25 – 27. Is your FMLA program operating in compliance and minimizing risk? Managers can use the cases in this article to do an informal spot check, highlighting areas to
discuss with counsel and FMLA services providers. This article is not legal advice.

Automatic Terminations
It is now a high-risk activity to automatically terminate if an employee has exhausted all leave options and hasn’t recovered the capacity to perform the essential job functions.

“The Equal Employment Opportunity Commission (EEOC) is focusing on employers with company-wide policies or practices that result in ‘systemic violations,’” said Martha Cardi, Chief Compliance Officer at Reed Group.  In a landmark 2011 settlement, Verizon paid $20 million in monetary relief to hundreds of former employees, the largest ADA settlement in EEOC history. Verizon ended its “no-fault” attendance policy that disciplined employees up to termination for “chargeable absences.”

Verizon accepted a rigorous three- year consent decree requiring several steps to achieve ADA compliance. Verizon wasn’t the only employer forced to do an about-face on automatic terminations. Others who paid penalties under consent decrees were:

• Supervalu/Jewel Food Stores paid $3.2 million to 110 former employees who weren’t 100% recovered at the end of medical leaves of absence;

• United Airlines paid $600,000 to a group of affected reservations agents unable to return from disability leaves who then had to retire or go on extended leave;

• Sears, Roebuck & Co. paid $6.2 million to class claimants who were terminated following exhaustion of workers’ compensation benefits.

An EEOC lawsuit is in-process with Princeton Health Care System for allegedly terminating employees after exhausting FMLA leave without an interactive process to consider accommodations.

“This is counter-intuitive for employers, it feels like they are being in- consistent and opening themselves up to discrimination claims” if they offer an interactive process to some employees but not all, notes Frank Alvarez, Esq., a Jackson Lewis senior partner and DMEC Compliance Conference keynote speaker.

“But this is part of the ADA.”

Although the EEOC is hunting for systemic violations, individual cases have generated costly settlements as well.

In Cuiellette v. City of Los Angeles, a police officer was dismissed from a “permanent light duty” assignment with no attempt to evaluate his abilities when the department learned he had a 100% disability rating from a workers’ compensation claim. The settlement was $1.5 million.

Training Managers

Several cases have highlighted the importance of training managers. Even though uninvolved in the daily details of FMLA notification and documentation, a manager can turn a troubling FMLA case into an expensive litigation nightmare.

In Kara Jorud v. Michaels Stores, the plaintiff alleged interference with her FMLA rights for cancer treatment and recovery, harassment’s and threats, wrongful accusation of theft, and un- fairly grading the condition of the store she managed.

A district manager for Michaels, alleged to have caused several of Jorud’s incidents, was named in the suit. Jorud said she appealed to corporate management for relief from the manager’s alleged actions but received none. The jury awarded $100,722 in lost wages for the FMLA interference claim, and a combined $8 million in personal and  punitive  damages  for  violation of the ADA and Florida Civil Rights Act. The judge reserved the right to increase the award for lost wages up to $1 million.  Many employers focus leave management on paid benefits, and might regard FMLA—which doesn’t provide pay replacement—as having lower cost risks in litigation. Jorud v. Michael’s can lay that mis-perception to rest! A termination can generate high lost-wages damages. Alvarez also notes that even if some FMLA cases do avoid damages for lost wages, a losing employer would still pay substantial attorney fees for both plaintiff and defendant.  While  the  behavior  alleged  in Jorud v. Michael’s is clearly over the top, milder behavior can also generate litigation. Cardi warns that “Intolerance or visible frustration with leaves can create liability even if the employee receives all the leave time requested.”

This is exemplified by Terwilliger v. Howard Memorial Hospital, No. 09- CV-4055 (W.D.Ark. 2011). In this case, an employee on FMLA back surgery leave received weekly calls from her supervisor asking when she was returning to work. During one call, the employee asked if her job was in jeopardy, and the supervisor allegedly replied that she should return to work as soon as possible.

Terwilliger took the full pre approved leave, later was terminated for suspicion of theft, and sued the employer for retaliation and interference with her FMLA rights. The court dis- missed the retaliation claim based on the employer’s evidence of attempted theft by the employee. The court allowed the interference claim to go to trial, however. The court applied the “chill theory… reasoning that a chilling of FMLA rights is sufficient for an FMLA interference claim.”

The employer was within rights to investigate for theft, and the court found  the  termination  was  lawful. The supervisor was within rights in calling  the  employee  during  leave, and in asking about when she would be back—but perhaps not in the level of pressure applied.

The final outcome of the interference  claim  hasn’t  been  reported  on, but even a “win” may be expensive. To help avoid “chill theory” interference claims, Cardi advises employers to use a trained person from HR or a vendor to call employees during FMLA leaves. If supervisors or managers make those calls, they should be trained on what they can and cannot say, and about the tone of the conversation.  Murphy v. FedEx Nat. LTL, Inc., reminds employers to train managers not to make promises about FMLA claims—or statements that could be construed as promises. In this case, the employee asked her manager for an additional 30-day leave following her husband’s death.

Her manager said, “Okay, cool, not a problem, I’ll let HR know.” The employee took this as a promise, and her manager didn’t tell her about any further steps to apply for the leave. The employee took the leave, was terminated, claimed interference with her FMLA rights and invoked “equitable estoppel” requiring the employer to fulfill its promise. The Eighth Circuit Court of Appeals agreed a promise was made, and remanded to the District Court for a jury trial that may result in an award to the employee.

Family and medical leave laws may not provide pay replacement (except under  Connecticut’s  new  paid  sick leave law), but this doesn’t necessarily shield the employer from liability for interference and retaliation claims when termination occurs.

Leave Management

Leave certification is an important leave management issue for employers.

New FMLA leave requests should always be met by giving the employee the full startup packet with instructions, requirements and medical certification forms. In Branham v. Gannett Satellite Information Network, Inc., the employer failed to provide the startup packet, the employee was not informed of the requirement for medical certification within 15 days of leave request, and could not be terminated for failing to provide it.

When do employees qualify for FMLA rights? Since they can’t take FMLA leave until 12 months/1,250 hours of work, an employer might think FMLA rights aren’t protected until then—and would be wrong.

In Pereda v. Brookdale Senior Living Communities, Inc. (January 10, 2012), plaintiff Kathryn Pereda notified her employer she would be taking FMLA leave for the birth of her child on or about Nov. 30, 2009. She did not yet qualify to take FMLA leave, but she would  have  become  eligible  by  the due date. The court held that “because the FMLA requires notice in advance of future leave, employees are pro- tected from interference prior to the occurrence of a triggering event, such as the birth of a child.”

The court found Pereda’s advance notice to her employer was “protected activity under the FMLA.” The em- ployer appeared not to know that. Pereda said she was harassed, disci- plined for attending prenatal appoint- ments, and inappropriately placed on a performance improvement plan before being fired in September, 2009.

“A gentle reminder—don’t treat your employee differently after the leave request has been made,” said Jeff Nowak, Partner at Franczek Radelet PC and Cardi’s co-presenter at the DMEC Compliance Conference. That applies equally to employees with a full bank of FMLA time, those who have exhausted their leave time, and those who don’t yet qualify to take FMLA leave.

In the case of intermittent leave, where the initial certification applies to every absence, employers cannot require a new doctor’s note for each and every incidence of absence.

In Jackson v. Jernberg Industries 2010 WL 60921 (N.D. Ill. 2010), the plaintiff argued that this requirement interfered with his FMLA rights, and the court agreed. The employer didn’t produce any evidence of suspicion about Jackson’s absences, but simply defended its requirement of doctor’s notes for every absence in an intermittent FMLA claim.

Cardi notes an employer with an “honest  suspicion”  has  alternatives, however, that they can exercise in a reasonable fashion and appropriately to the case at hand:

• Call the employee at home to verify they are in recuperation;

• Speak directly with the employee to verify or clarify information about the absence;

• Call a medical provider to verify the employee appeared for the stated appointment (but ask no more than that);

• Question co-workers about their knowledge of the claimant’s activities during an absence;

• Perform surveillance of employee activities, but only in extreme cases justified by the circumstances.

One such extreme case was Douglas Rydalch v. Southwest Airlines. Rydalch, a reservation agent, worked in South- west’s Houston office, but his family lived in Salt Lake City. Due to low seniority, he had difficulty in getting time-off around holidays. He received warnings from the employer about his questionable use of FMLA.  Investigations found he took more than 35 FMLA days just before or after his previously scheduled time off, including late December, 2007.

The employer gave Rydalch two warnings before taking action. The employer then hired an independent hearings officer to conduct a hearing in which Rydalch was represented by a member of his union. The officer concluded Rydalch had violated the company’s attendance program. A Utah District Court dismissed all Rydalch’s claims, including FMLA interference and retaliation, and ADA discrimination, accommodation and retaliation.

The court stated, “Southwest’s reason for firing Mr. Rydalch—its honest belief that he abused FMLA leave—is legitimate and nondiscriminatory. An employer’s belief that an employee is misusing FMLA leave provides sufficient justification to terminate his employment if that belief is honest.” By hiring an independent hearings officer, the employer had solid proof that its belief was honest.

Conclusion

Legal counsel and services providers are part of every employer’s “FMLA team” and their first resource for building compliant programs, reducing risk and defending against litigation. DMEC offers this review of important FMLA cases to help IDAM professionals identify areas to review and discuss with their FMLA team.

Article contributed from www.dmec.org ▪ @work