The Top 5 USERRA Traps and How to Avoid Them

Announcer: Welcome to the Ogletree Deakins podcast, where we provide listeners with brief discussions about important workplace legal issues. Our podcasts are for informational purposes only and should not be construed as legal advice. You can subscribe through your favorite podcast service. Please consider rating this podcast so we can get your feedback and improve our programs. Please enjoy the podcast.

Jay Patton: Good morning. This is Jay Patton. I’m here with Amy Glenos, and we’re the chairs of Ogletree’s Military Workforce Practice Group.

Amy Glenos: So, today’s topic is USERRA, the Uniform Services Employment and Reemployment Rights Act of 1994. And specifically, we’re going to talk about the top five pitfalls that keep landing employers in court.

Jay Patton: Stick around because at the end, we’ve got a pop quiz. It’s straight out of the source material. And honestly, employers often get this wrong.

Amy Glenos: Sounds like fun. Shall we get started?

Jay Patton: Sure. Okay. Baseline. USERRA was passed in 1994, most recently amended in 2025 through the DOE Act. And its whole purpose is threefold. Encourage people to serve in the military, minimize disruption to their civilian lives, and stop discrimination against military members. And remember, this is a federal law that applies to uniformed service members and what happens during their military time away from their civilian employment positions.

Amy Glenos: So, who does this law apply to, Jay?

Jay Patton: Everyone, literally.

Amy Glenos: Say more.

Jay Patton: First, there’s no minimum number of employees. It’s not like you have to have a hundred employees for USERRA to apply. You could have two, three, four, and it still applies. There’s no threshold employment period. In other words, you don’t have to work for 1250 hours before USERRA provides protections. You could work for a single day, and it would cover that employee. And it covers private and public employers alike. If you pay someone’s wages or control their working conditions, you’re an “employer” under USERRA.

Amy Glenos: So even a small business with two employees, are they also covered by USERRA?

Jay Patton: They are. And it’s not just the four branches you’re thinking of. We’re talking Army, Navy, Marine Corps, Air Force, which you expected, Space Force, Coast Guard, National Guard, and even the Commission Corps of the Public Health Service and FEMA Reservist.

Amy Glenos: So, with that foundation set, let’s get into the pitfalls. The first, documentation. Tell us why this one’s so difficult, Jay.

Jay Patton: I mean, you’re juggling both documentation and service exemptions and trying to balance all this when often you don’t get the best communication on these orders. This one trips people up because it feels backwards. You’d think no paperwork, no leave, and that’s wrong.

Amy Glenos: Got it. So, employers can’t deny leave or delay or deny prompt reemployment just because documentation is missing or unavailable. Is that what you’re saying?

Jay Patton: That is what I’m saying.

Amy Glenos: Okay. And documentation only becomes required once service exceeds 30 days. Is that also true?

Jay Patton: That is true. But even when documentation is required, you still can’t condition leave and reemployment after leave on providing prompt documentation.

Amy Glenos: And what’s the service exemption you’re talking about?

Jay Patton: So, the service exemption, there’s a five-year cumulative service exemption that employers need to track, but it has carve-outs like completion of obligated service, required training for reservists, National Guard, and involuntary service. And that five-year service cap is per employer, which means basically that each employee gets up to five years away from their job and they’re still protected by USERRA.

Amy Glenos: But it’s possible to have even more than five years and still have USERRA reemployment rights. Is that true?

Jay Patton: Yes, because of the carve-outs that I mentioned, you could see service of six years, seven years, nine years. I think you’ve even seen one of 13 years.

Amy Glenos: I actually have, Jay. So, it’s important to know about the exemptions and understand them before separating employment for somebody exceeding five years of cumulative service. So, I think the takeaway on this one, don’t let paperwork become your excuse to say no. If an employee provides verbal notice of the need for military leave, grant it. And once the employee requests reinstatement, do so promptly and return the employee to work. Sort out the documents later. This is what courts contemplate and what USERRA requires.

Jay Patton: Definitely. It’s a look before you leave type situation for sure. Okay. Let’s talk about pitfall number two, paid leave, which we kind of highlighted in our intro. This one can be an expensive one, the paid leave requirements.

Amy Glenos: Yeah. So, is military leave or USERRA a paid leave statute?

Jay Patton: Not in the way it’s written. It doesn’t mention paid leave anywhere.

Amy Glenos: So, it’s my understanding that claimants have started alleging that section 4316B is the vehicle for paid leave. And that provision states that employees on leave for uniform service are entitled to the same non-seniority benefits as employees on comparable leave. And that may or may not include paid leave.

Jay Patton: You’re right. And the case law backs this up really aggressively. Remember those numbers we opened with?

Amy Glenos: I do.

Jay Patton: Those involve different settlements, including the Traverse v. Federal Express, which settled for 1.5 million. Clarkson v. Alaska Airlines settled for 4.75 million. And there’s another case with a settlement of 18.5 million.

Amy Glenos: That’s stunning. So, do we know for a fact that paid leave is a USERRA protected benefit?

Jay Patton: The rulings are not really definitive on that. They indicate that, but we’ve not really gotten the final, final ruling to make that completely clear.

Amy Glenos: So, the question of whether paid leave is a protected rider benefit, maybe one case has addressed that, but it’s largely still open. Is that correct?

Jay Patton: That is correct.

Amy Glenos: So, employers should probably review their policies and keep USERRA in mind when enhancing non-military leave benefits. Is that something to consider?

Jay Patton: It’s definitely something to consider. Reviewing these policies carefully, taking this into account can result in creating a fully paid military leave benefit. It may also create a lowering of other benefits to make sure things are in line and you avoid this potential pitfall.

Amy Glenos: Very interesting. Moving on to the next pitfall, reductions in force and separations. What does USERRA have to say about that?

Jay Patton: Amy, it’s got a lot to say. This is where everyone’s favorite the escalator principle comes in. And I love this metaphor because it’s from a 1946 Supreme Court case, Fishgold v. Sullivan Drydock. So just think about it. Massive mobilization to fight World War II and all these service members are coming home. And here’s what that quote said. The returning veteran does not step back on the seniority escalator at the point he stepped off when he went out to war. Instead, the quote says the returning veteran does not step back on the seniority escalator at the point he stepped off. He steps back on at the precise point he would’ve occupied had he kept his possession continuously.

Amy Glenos: Interesting. I have a question about that. Can the escalator move in both directions?

Jay Patton: Absolutely. It can take you up to the height but also drop you off resulting in the end of your employment. And really specifically, if the employer would’ve eliminated that position through a riff, regardless of the employee’s service, the escalator can move towards termination.

Amy Glenos: So, is that a foolproof defense for a reduction in force?

Jay Patton: It’s not a foolproof defense, but in instances where one can show this is a widespread reduction affecting more than just the military member upon their return, it can be a defense under a couple different ways. But it is an area where a service member’s employment can be ended without invoking USERRA liability for the employer.

Amy Glenos: So, it sounds like it’s not a fool proof defense and that it’s only feasible or available if the employer can show business need in the other positions, not just the service members who were affected. Is that a fair statement?

Jay Patton: That’s right. That is a fair statement. And on separations, the burden flips to the employer to prove the termination was for cause. There are also specific requirements for waiving USERRA rights in severance agreement. Don’t assume a standard release form covers it. And another thing on this, termination was for cause. There are specific protections in USERRA following terms of service where an employee has a heightened at will employment status where they cannot be terminated except for cause.

Amy Glenos: Interesting. Can you give us some examples of what a court may consider to be cause?

Jay Patton: I can. Some of the examples that have been ruled on by courts include disabling a client’s website, engaging in an altercation with their supervisor, and other related conduct type things. There’s also protection for performance issues where those are documented and explained in advance and began before the uniform service.

Amy Glenos: So poor performance could constitute cause–

Jay Patton: It can–

Amy Glenos: In some juries.

Jay Patton: But it needs to be looked at carefully. It needs to be…advanced notice needs to be provided to the employee.

Amy Glenos: Got it. So, moving on to the next pitfall, re-employment positions and determining what they are. Tell us a little bit about how that works because it sounds like employers are expected to have a crystal ball to determine what would have happened. So, how does this work in practice?

Jay Patton: Yeah. I mean, it can be complicated. I mean, we’re talking about the pre-service position, which is a position they were in before they left. The ideal and what USERRA wants us to do is the escalator position. And as you said, that is a bit of a crystal ball. It’s as if they never left. Sounds like a mob metaphor or something, but how do you know exactly what that position will be? But that is part of the obligation. And then there’s a hierarchy if the escalator position may not be available, other positions. Can you help us understand some of the other–

Amy Glenos: Yeah, sure. So, I think for a long-term leave defined by USERRA is greater than 90 days. Employers have a hierarchy of re-employment positions starting with the escalator position. If the employee’s not qualified and the employer can’t help the employee to become qualified for the escalator position, we default to the pre-service position or a position of similar seniority status and pay. And we go through the same qualification requirements. If that can’t be accomplished, we default to the nearest approximation position. So, there’s a range of potential positions that USERRA potentially contemplates. USERRA does not use the term interactive process similar to the ADA, but that’s what it feels like because you’re working with the employee to try and figure out what position is the reemployment position, particularly if the person’s been gone for several years and the reemployment position is no longer available.

Jay Patton: Well, very interesting. Well, you said something about a duty to help get the employee re-qualified or qualified position. Can you tell us more about that?

Amy Glenos: Sure. So, employers are not required to waive bonafide training or certification requirements. However, they have to help the employee by making reasonable efforts to get them qualified for the reemployment position. There are limits, of course, to what efforts may be reasonable. A third-year law student or summer intern doesn’t get to return to a firm after several years as a shareholder. So, there is some reasonableness built into identifying the reemployment position under USERRA.

Jay Patton: And then there’s one other thing I wanted to ask you about. Does an employer have to create a new position under USERRA?

Amy Glenos: No. However, in some jurisdictions, it begins to feel like that. You have courts contemplating that surely with large employers, they must be able to find a position somewhere.

Jay Patton: So, are you saying if I’m returning to a 10,000-employee company versus a 10-person company, there’d be a difference in the standard?

Amy Glenos: There could be, potentially. You’d be invoking the undue hardship defense in that instance in addition to the change circumstances defense. But employer size certainly matters.

Jay Patton: So, what I’m taking is these reemployment position questions can be pretty complicated.

Amy Glenos: Agreed. So, moving on to the next pitfall, voluntary versus involuntary service. Tell us, Jay, does USERRA cover both?

Jay Patton: Well, Amy, it does. It covers both involuntary when you are required to return to the military by presidential order or by other governmental order under your enlistment or otherwise contract or agreement with the military.

Amy Glenos: I’m confused. We haven’t had a draft since 1969. So, isn’t all military service voluntary?

Jay Patton: Initially it may be, but once you raise your hand and agree to enter, you enter into a contract with the government and with your country as to your obligations. And that can include being called back at a time when you didn’t volunteer for this specific assignment. And so, this is the whole deal is that the USERRA covers both. And many employers or some employers may at times say, oh, USERRA doesn’t apply when someone volunteers to serve in the military, it only applies when they’re involuntarily made to serve. But that’s not correct. It covers both. And it’s very important to make sure that employers do that.

Amy Glenos: And protect the service and extend the same benefits regardless of whether the service was “voluntary or involuntary”.

Jay Patton: Absolutely.

Amy Glenos: All right. So, we promised a pop quiz. And this is a real question pulled straight from the source deck. And it’s a great gut check for any employer listening.

Jay Patton: Yeah. So put on your HR hat and think about this question. What is the statute of limitations for a USERRA claim? Is it A, one year, B, two years, or C, none?

Amy Glenos: So, taking a second to think about it as if I’m an employer being asked this question in an audit.

Jay Patton: All right. Have you got your answer?

Amy Glenos: I do. And Jay, it’s unbelievable. There is no statute of limitations for USERRA claims.

Jay Patton: What?

Amy Glenos: So, C is the correct answer. As of 2008 and USERRA’s amendment at that time, the statute of limitations was effectively eliminated.

Jay Patton: So let that sink in. A service member could theoretically bring a claim years, even decades after the fact, and it’s not time barred.

Amy Glenos: So, what defenses would be available to employers in that instance?

Jay Patton: Yes. Laches is a defense that employers should argue in these type cases, especially when the claim is being brought years and years after the actual conduct at question.

Amy Glenos: Got it. So, before we wrap up, why does all this actually matter? Is this just an internal HR headache or can employees bring suit?

Jay Patton: No, employees definitely can bring suit. They have a private right of action individually or as a class with no administrative requirements or prerequisites. They can choose to go through the Department of Labor’s vet’s office and file a complaint there and have it investigated and resolved. Or they could seek mediation through the Department of Defense’s employer support for guard and reserve program or ESGR mediator program, as we call it, but they don’t have to do any of that. They could instead just bring a lawsuit.

Amy Glenos: So unlike claims under Title VII, employees don’t have to exhaust administrative prerequisites.

Jay Patton: There is no administrative exhaustion requirement at all. And another thing, remedies under the statute aren’t small. Reinstatement, back pay and front pay, and this is one that should get every general counsel’s attention, liquidated damages for knowing violations equal to the greater of $50,000 or total lost wages and benefits plus interest. So let me say that again. Minimum liquidated damages for a knowing violation of USERRA or $50,000.

Amy Glenos: And this change was recent, correct?

Jay Patton: Yes. It’s part of the Dole Act in early 2025 that added this. Plus, it also added mandatory attorney’s fees for prevailing plaintiff in a USERRA case.

Amy Glenos: Whereas before, attorney’s fees were discretionary, within the discretion of the court.

Jay Patton: Yeah. But now they’re mandatory.

Amy Glenos: So, this isn’t just a slap on the wrist statute. It’s built to bite.

Jay Patton: Definitely.

Amy Glenos: So, to recap our five pitfalls, number one, documentation and exemptions. Number two, the potential for paid leave benefits. Number three, reductions in force and separations. Number four, the scope of re-employment positions under USERRA. And finally, the absence of any distinction between voluntary and involuntary service to gain USERRA protections.

Jay Patton: And remember, there’s no clock running out on these claims. So, the we’ll deal with it later approach is not a strategy for USERRA.

Amy Glenos: Got it, Jay.

Jay Patton: Stay compliant out there.

Amy Glenos: Thanks guys.

Announcer: Thank you for joining us on the Ogletree Deakins podcast. You can subscribe to our podcast on Apple Podcasts or through your favorite podcast service. Please consider rating and reviewing so that we may continue to provide the content that covers your needs. And remember, the information in this podcast is for informational purposes only and is not to be construed as legal advice.