By Dana Stripling, J.D, Garlo Ward P.C. www.garloward.com
Posted December 14, 2004
The U.S. Supreme Court has only a few employment law cases to address this term. And it recently declined to review a retirement benefits case that may be of interest to employers. The Supreme Court effectively let stand a Seventh Circuit decision holding that a company was not liable for failing to inform workers that lifetime retiree health benefits could be eliminated. The Seventh Circuit had concluded that plan documents entitled the company to end the plan at any time and that the company did not intentionally deceive the workers. Thus, a split among the circuit courts continues regarding employer liability over the elimination of promised benefits.
New Law Makes Electronic I-9s Acceptable
Employers can now complete and retain I-9 forms electronically under a new amendment to the Immigration and Nationality Act. The amendment doesn’t alter your I-9 obligations, nor does it require you to keep electronic versions. It merely allows you the option of keeping an “electronic version,” and it permits both hand-written and electronic signatures. Enacted October 30th, the law will take effect either 180 days after that date or whenever final regulations are implemented, whichever comes first.
New Credit Reporting Forms Available
Ever considered using an outside investigator to look into allegations of workplace misconduct, such as embezzlement or theft or in reviewing applications for high-level or fiduciary positions? The Fair Credit Reporting Act (FCRA) requires employers using outside investigators to notify employees that their conduct was being investigated. The Federal Trade Commission (FTC) has now issued final rules under the FCRA. The rules become effective January 31, 2005. Three forms that were issued by the FTC in 1997 are now obsolete and have been replaced, and an additional one has been added (summary of rights of identity theft victims). The new user notice concerns the controversial issue of whether FCRA notification and disclosure rights apply to third-party investigations into employee misconduct. The notice confirms that such investigations will not treated as “consumer reports” under the FCRA as long as the employer complies with Section 603(x) of the FCRA. To obtain a copy of the new user notice, please contact our office.
Veteran’s Issues Remain Top Priority
The number of complaints filed by returning military and reservist members increased from 900 in 2001 to 1,315 in 2003. However, that is significantly less than the number filed in 1991 (2,500) following the Persian Gulf conflict, particularly considering that thousands fewer were called up for the latter. The Department of Labor (DOL) believes the lower number of complaints can be attributed to employers’ growing understanding of their obligations under the USERRA. DOL estimates that at least 420,000 citizens have mobilized since September 11, 2001, which includes more than 260,000 already demobilized. Even one USERRA complaint is one too many.
On December 10th, President Bush signed into law the Veterans Benefits Improvement Act of 2004. Employers are required to post a notice of rights under the Uniformed Services Employment and Reemployment Rights Act (USERRA). The Department of Labor must make a notice available to employers within 90 days. More immediately, the 18-month coverage period for continuing health benefits for military members has been increased to 24 months, beginning with elections made on or after December 10th.
Proposed Rule Regarding Veterans
Reservists returning from military leave to private employment may be eligible as soon as they are reinstated for family and medical leave, according to the DOL in a long-awaited proposed rule for the USERRA. The proposed guide provides that reinstated veterans may take family and medical leave if the time worked for employers plus the hours that would have been earned if there had been no military service otherwise meet FMLA eligibility requirements. The proposed rule effectively gives reservists credit for time away from the job so they will not be penalized upon their return and to encourage recruitment.
The proposed rule also confirms that, even absent FMLA eligibility, reservists returning with a disability may use leave under the Americans With Disabilities Act (ADA), which, like military leave, is immediately available to new employees. But unlike the FMLA and the ADA, the USERRA requires employers to provide leave for an indefinite amount of time.
Moreover, USERRA typically requires reemployment of returning veterans after up to five years of military leave. However, there is no limit on how much time might elapse between the date the employee leaves a civilian job and when s/he actually enters the service. The proposed rules confirm the propriety of this unlimited coverage because a person entering military service generally takes some time to prepare and finalize personal affairs and then traveling and actually arriving for service. This time, of course, will vary from person to person. However, should an unusual delay occur, the circumstances causing the delay would be considered when determining whether the person’s absence truly was due to service in the uniformed services.
Employees do not have to get their employers’ “permission” before leaving to secure their reemployment rights. Although employees going on military leave must provide advance notice, the proposed rules do not specify exactly much advance notice should be given. To complicate things, notice may be excused due to military necessity or when it would be impossible or unreasonable. Moreover, “[t]he employer may not press the employee for any assurances about his or her plans” about returning to his or her former job or the private workforce in general.
Handling Right-of-Return Challenges
The indefinite length of USERRA leave poses numerous difficulties for employers when planning how to staff jobs. How can you cover the reservists’ positions while they are away? Coverage may involve splitting up the work or hiring a replacement, and returning the reservist to a similar job on his or her return, among other options.
USERRA’s reinstatement provisions and protections against discharge are very broad, covering even temporary, part-time, probationary and seasonal workers as well as employees on strike, layoff or other leaves of absence. Nevertheless, if you can show the job was for a brief, non-recurrent period and there was no reasonable expectation employment would continue indefinitely or for a significant period, you are not required to reemploy a worker.
In addition to reinstatement, returning veterans are also protected from discharge for a period that varies, depending on the length of their military service. The longer the military service, the more time they are no longer at-will employees after their return. They may be fired only “for cause” within a set period. Upon 180 or more days’ military leave, an employee may not be discharged from a private-sector job within one year after reinstatement except for cause. Service between 31 and 180 days, entitles a returning employee to protection for180 days after reemployment. “Good cause” for discharge may include: (1) unacceptable or unprofessional public behavior; (2) incompetent performance of duties; or (3) criminal acts. An employer may also stop employing a returning reservist during the protected period under certain circumstances if there is a legitimate layoff or job elimination or if a reduction in force during a military leave would have included the reservist. The protections from discharge are different for persons serving less than 30 days. DOL reasoned that: “A period of readjustment may be especially warranted if the service member has assumed a new employment position after the military service.”
USERRA’s “escalator” provision may require a returning employee’s reinstatement to a new position if they would have attained that position except for the military leave. Veterans should not be denied the promotions they would have attained had they not served their country. If passing a skills test or examination is required for the promotion, you may have to administer a makeup promotional exam to the returning employee. Any makeup exam should be given after the worker has had a reasonable time to acclimate to the civilian workplace.
Moreover, assuming the employee passes the exam and probably would have passed it and been promoted during his/her absence, the promotion must be made effective as of the date it would have occurred had the employment not been interrupted by military leave. You similarly would be required to provide any missed skills test or examination that is the basis of a merit pay increase
While the proposed USERRA rules would give returning personnel time to readjust to the civilian workforce, employers are required to act expediently to reemploy workers promptly. Generally, reemployment must occur within two weeks of the returning workers’ application for reemployment. The shorter the leave, the prompter reinstatement should be. By way of example, the next regularly scheduled workday would constitute “prompt” reinstatement after weekend National Guard duty. By contrast, prompt reinstatement after several years of active duty may require more time, because the employer may have to reassign or give notice to another worker who occupied the job in the interim.
All information in this article is informational only and is not legal advice. Should you have any questions or a situation requiring advice, please contact an attorney.
Copyright 2004 by Garlo Ward, P.C., all rights reserved.
Lakeway, Texas 78734 USA
Telephone: 512-302-1103
Facsimilie: 512-302-3256
Email: Info@Garloward.com
