The Department of Justice recently has been increasing enforcement efforts against employers it suspects have discriminated against armed forces members returning from active duty and seeking to re-enter the civilian workforce.

These DOJ enforcement actions include lawsuits under the Uniformed Services Employment and Reemployment Rights Act of 1994. This statute generally applies to every employer regardless of size. It prohibits discrimination against service members and entitles them to return to civilian employment at the same level of pay, benefits and employment status they would have attained if continuously employed - subject to few exceptions.

Despite USERRA's protections, an October 2007 Department of Defense survey of more than 58,000 reservists demobilized between Sept. 11, 2001 and June 2006, revealed that 10% of respondents reported loss of workplace seniority and pay; 10% reported reduced pensions; 7% reported their employer did not make a reasonable effort to refresh their skills; 5% reported loss of health insurance; and 5% reported denial of prompt re-employment - all of which violate USERRA.

Cautionary cases

In the first six months of 2009, DOJ filed at least 14 lawsuits based on USERRA violations, compared to 12 in all of 2008, seven in 2007 and three in 2006. These lawsuits run the gamut, including claims based on failure to reemploy, failure to apply the "escalator" principle, failure to accommodate a disability, wrongful failure to promote, unlawful termination and unlawful retaliation

The prototypical USERRA lawsuit brought by DOJ involves failure to re-employ promptly or failure to apply the escalator principle. In June, DOJ filed suit on behalf of an Army Reserves colonel who allegedly was denied reemployment as a deputy chief comptroller for the state of Nevada.

According to the complaint, the reservist instead was offered a chief accountant position in which he would have reported to and been paid less than the deputy chief comptroller, provided he pass a qualifying examination and complete a one-year probationary period. Moreover, when the reservist complained to the Department of Labor Veterans' Employment and Training Services, he was terminated. DOJ is seeking reinstatement in the higher position, lost wages and benefits, and multiple damages for a willful violation of the law.

The government also has pursued USERRA claims where employers have failed to reemploy and provide accommodation for an injury sustained during active duty. In May, the United States sued the state of California for allegedly failing to promptly re-employ an injured Air Force reservist.

The employer allegedly forced the reservist to undergo a six-month, unpaid medical evaluation period, refused to reemploy him in the same position because of his physical limitations and failed to retrain him for a position of like seniority and status. Also, the employer allegedly offered no re-employment at all until the reservist filed a complaint with VETS and then offered only lower-paying and less-senior positions. The complaint seeks lost wages and benefits.

Sometimes the government also pursues less conventional cases under USERRA. Also in May, DOJ sued a Utah company based on allegations that it attempted to dissuade an employee from joining the National Guard by offering a promotion, pay raise and increased benefits to withdraw his enlistment. Also, this employer allegedly terminated the employee when he refused to withdraw his enlistment. In addition to suing the company, DOJ also sued the individual owner, seeking lost wages and benefits.

Consequences of noncompliance

The consequences of a USERRA lawsuit can vary. Employers can be subject to a variety of remedial measures, including being compelled to:

• Pay lost wages and benefits.

• Reinstate, promote, reassign and/or provide a reasonable accommodation to an injury.

• Pay multiple damages if the violation was willful

• Pay the plaintiff's litigation costs and attorneys fees.

The magnitude of possible liability is illustrated by a Connecticut federal district court judgment against Wachovia Securities in March. The case involved an Air Force reservist, a civilian financial adviser, who was called to active duty in September 2001.

He alleged that when he sought re-employment with Wachovia after his discharge two years later, his accounts had been assigned to other advisers, and Wachovia refused to restore his book of business.

The reservist was awarded what is believed to be the largest USERRA judgment ever - at least $1.13 million for double back- pay, interest, costs and attorneys fees. Since Sept. 11, 2001, more than 1.5 million service members have been deployed to Iraq or Afghanistan, and more than 630,000 military reservists and National Guard members have been mobilized

With tens of thousands of these service members returning home from these wars, employers need to be aware of USERRA's requirements and recognize that our legal and political institutions, and the wider public, are showing a greater willingness and purpose in enforcing this aspect of the law.

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