From the February 2002 issue of Entrepreneur

When your newly hired sales manager told you he was in the Army Reserve, you figured it meant giving him a little time off now and then. But the war on terrorism changed all that, and now your employee's unit has been deployed far away for who knows how long. What are your obligations?

Time to find out. "Most employers think of military leave as one weekend a month and two weeks over the summer," says Jason Branciforte, an attorney with Littler Mendelson in Washington, DC, who specializes in military leave issues. "They don't realize it might be years." After all, the last time U.S. reservists were called up was during the Gulf War, when many of today's small businesses didn't even exist.

The federal law that governs this issue, the Uniformed Services Employment and Reemployment Rights Act (USERRA), prohibits employers from discriminating on the basis of military service. That includes both voluntary and involuntary service, whether it's active duty, active duty for training, inactive duty, or absence from work for an examination to determine fitness for duty. In addition to Army, Navy, Air Force and Marines, the law covers service in the Coast Guard, the National Guard and the commissioned corps of the Public Health Service, plus any other category the president designates during a time of war or national emergency.

You can't refuse to hire people because they're in the service or refuse to promote them because they might be called up for duty. And you can't terminate people because their unit has been deployed, even if they've been gone three years.

Under USERRA, which applies to all U.S. employers, workers are entitled to military leave of up to five years. This is unpaid leave, but benefits such as health insurance and life insurance must continue if they're provided for employees on other forms of unpaid leave (such as the Family Medical Leave Act or disability). Branciforte notes that some employers elect to continue paying employees' salaries for a given number of months or to pay the difference between their salaries and military pay.

Coming Home

The tricky part is what happens when employees return from their stint in the military, especially if their absences were so long that you had to fill their positions. They must get their jobs back or be re-employed in the position they would have attained if they had been continuously employed. Suppose an employee would have been eligible for promotion at the end of a review cycle but was called up for duty first. When the employee returns, you can't pass him or her over for the promotion merely because of the time lost to military service. "Congress intended that service members not miss out on opportunities because they were called up," Branciforte says.

An employee who won't qualify for a promotion must get his or her old job back, or the nearest approximation to it. If the employee was gone longer than 90 days and a close approximation isn't available, you may offer a job of "like status." But the employee is entitled to the seniority and vacation he or she would have accrued if he or she hadn't been called up. Also, a worker who's been reinstated after military service may be terminated only for cause for a given period determined by the amount of time spent in the service.

Be aware that the federal law is just a platform, and every state imposes additional responsibilities. Your state might expand the length of time military employees may be gone and still get their jobs back, include the state national guard in the protected class, or require less notice from employees about coming military service. Check with your attorney about your state's law.

The Patriots
Employers rarely violate military leave laws. Most likely that's not out of fear of the penalties, which include compensation for lost wages and benefits and, if the violation is willful, an equal amount as liquidated damages. "Military leave questions arise during times of intense patriotism," Branciforte says. "It's more of a road map for employers on what to do when [workers] come back. Once employers are informed, they follow the law."

Still, if you have a very small business, it's probably impossible to keep someone's job open for months or years. Consider filling it with a temporary employee. "[The military employee] may come back within 90 days, and you'd be stuck," Branciforte says. "You'd have to fire someone to give the [employee] their job back."

What about the cost? The SBA offers the Military Reservist Economic Injury Disaster Loan Program, which can help eligible small businesses meet ordinary operating expenses associated with having an essential employee recalled to active duty. Beyond that, following these laws is just a matter of doing your part.


Steven C. Bahls, dean of Capital University Law School in Columbus, Ohio, teaches entrepreneurship law. Freelance writer Jane Easter Bahls specializes in business and legal topics.

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