The White House has announced that today President Barack Obama signed into law the Veterans’ Benefits Act (VBA) of 2010. Among other improvements in the law for veterans, the VBA enhances the employee protections of the Uniformed Services Employment and Reemployment Rights Act (USERRA). USERRA protects service members from employment discrimination and retaliation on account of their service. It is particularly important for members of the reserves who face retaliation for their periodic absences from work, and their inability to schedule reserve duties around an employer’s preferences.
The VBA amends USERRA, 38 U.S.C. § 4303(2), to make clear that employees are protected from discrimination in their wages and benefits. In 2002, the Eighth Circuit U.S. Court of Appeals held that USERRA exempted wages and benefits from protection against discrimination. Gagnon v. Sprint Corp., 284 F.3d 839, 852-53 (8th Cir. 2002).
VBA also adopts a multi-factor test to determine if a successor company is liable for the USERRA violations of a predecessor company. Too frequently, employers use a shell game of changing ownership to evade liability for their actions. The Department of Labor adopted a regulation to allow a wise look at all the circumstances to determine if the new company should be held liable for the previous company’s violation. 20 C.F.R. § 1002.35. However, the Eleventh Circuit narrowed the application of this rule by requiring that there be a merger or a transfer of assets before successor liability can be imposed. Coffman v. Chugach Support Services, Inc., 411 F.3d 1231, 1237 (11th Cir. 2005). Both Gagnon and Coffman are now ineffective as Congress has changed the law to specifically require the opposite result.
The VBA adds that the amendments "shall apply" to any violation of USERRA "that occurs before, on, or after the date of the enactment of this Act," and to all USERRA actions "that are pending on or after the date of the enactment of this Act." Congress is wising up to the ways courts resist applying remedial laws to accomplish their purposes. USERRA has been a harbinger of legislative refinements to anti-discrimination laws, and I look forward to Congress exercising this type of wisdom when it updates other employee protection laws.