USERRA Amendments Impose Two New Requirements On Employers of Employees On Active Duty in the Armed Forces

January 2005

Two changes to the Uniformed Services Employment and Reemployment Rights Act (USERRA) warrant the attention of employers with employees serving on active duty in the military.  First, under USERRA, employers are required to provide temporary continuation of employer-sponsored health coverage to employees called to active duty and their families, at their election and their expense, where that employee’s coverage would otherwise terminate because of absence from work.  Previously, the eligibility period for continuation of coverage was eighteen months; the new amendment extends this eligibility period to twenty-four months.  The effective date of this amendment is December 10, 2004, so any elections made as of that date are subject to the longer eligibility period.  Employers should contact their health care plan administrators at once to ensure the plan administrator is complying with this change.  Further, employees who made the election after December 10, 2004 pursuant to the eighteen-month eligibility period should be contacted and informed of the longer period.

The second change requires employers to provide notice “of the rights, benefits, and obligations” of employees entering military service covered by USERRA and of their employers.  This notice requirement can be satisfied by posting it where other required notices (such as FMLA and EEO rights) are posted.  This requirement becomes effective on March 10, 2005.  The Secretary of Labor is charged with providing the required content of the notice before the effective date.  Employers need to ensure they have the notice ready for posting prior to March 10.  If you do not have the notice on March 9, 2005, please call Frost Brown Todd LLC and we will provide it to you.

Legal Analysis/Practical Application

As of January 3, 2005, almost one million military personnel had been deployed to Iraq, Afghanistan, and other areas of conflict since September 11, 2001, according to the Army Times.  Guardsmen and Reservists have been deployed in record numbers and often for longer-than-anticipated periods of time.  The extension of the health benefits eligibility period was undoubtedly necessitated by these longer deployments and the need to ensure that family members of these citizen soldiers who do not elect military health benefits have access to adequate health care throughout the deployment period.  Compliance with this amendment, and with the notice posting, should have minimal impact on employers.

These amendments precede the issuance of the new USERRA regulations, which were posted for public comment in September and are expected to be released in final early this year.  These regulations are intended to provide “clear and consistent guidance” to employers and employees alike, according to Department of Labor Secretary Elaine Chao.  Secretary Chao also issued a warning to employers that a recently executed agreement between the Department of Labor and the Justice Department will strengthen the Department of Labor’s ability to enforce the USERRA against employers who fail to comply with its mandates.

Employers need to ensure strict compliance with USERRA.  In the current political environment, failure to support your deployed service personnel can create not only legal liability, but also a public relations backlash.  On the other hand, employers who go beyond the requirements of USERRA by, for example, making up the difference between an employee’s active-duty wages and civilian wages, may find the reward in employee loyalty and positive publicity more than makes up for the cost.

Martha L. Boyd, a Major in the U.S. Army Reserve and an attorney in Frost Brown Todd’s Nashville office who recently spent nine months in Iraq with the Army Reserve’s 350th Civil Affairs Command, or any of the other attorneys in the labor and employment department at Frost Brown Todd LLC stand ready to answer your USERRA questions.  Expect to see another advisory when the new USERRA regulations are released.

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