USERRA’s Statute of Limitations

At our Annual Employment Law Seminar, U.S. Department of Labor Chief of Investigators Kenan Torrans gave an informative presentation on the requirements of the Uniformed Services Employment and Reinstatement Rights Act (USERRA). At the end of the presentation, I jumped in with my two cents and explained that I’d invited Kenan to speak because I think that USERRA compliance will be one of the biggest issues facing employers in the next several years.

One reason for my speculation is that USERRA differs from other employment-discrimination statutes in a number of ways. So employers who may not be familiar with USERRA’s specific requirements and attempt to comply by applying rules that are generally applicable to Title VII or the ADA may find themselves to have run afoul of the law.

Another reason for my worries is the statute of limitations or, more specifically, the lack of one. An employee could, for example, return from military service and seek reemployment. Let’s say the employer is unfamiliar with USERRA’s requirements and denies the employee’s request to return to work. The employee may find other work and the employer would think that all is well.

Well, not necessarily. If the employee’s replacement job does not pay as well or has lesser benefits, the employee could later file a claim against the original employer. And, by “later,” I mean much, much later. As in forever. Because there is no statute of limitations, there is no time limit on when an employee can file a claim.

Which is why a recent decision by the Sixth Circuit caught my attention. In Oswald v BAE Industries, Inc., No. 11-1119 (6th Cir. May 12, 2012), the plaintiff alleged that he’d been terminated due to his military service in Iraq. He filed suit three years after he was let go. The employer moved to dismiss on the grounds that the claim was precluded by the plaintiff’s employment agreement, which required all employment-related claims be brought within six months. The court agreed and found that the employee’s claims were time barred.

USERRA was amended in 2008 to preclude any statute-of-limitations defense and the employment agreement in this case was signed prior to the amendment. So this would not work in new contracts drafted today. However, it is important for employers who have such provisions in employment agreements already in place.

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