Tuesday, July 14, 2015

Do I Have to Pay an Employee Away on Military Leave?

The United States has one of the largest military reserve forces in the world, with over 850,000 members. A large percentage of these reservists are also employed in the civilian labor force. Individuals serving in the reserves generally have to take time off throughout the year for training, which often requires them to miss work. In times of crisis or national emergency, they may be called into active duty, causing them to miss months or even years of work. Does an employer have to continue to pay these employees while they are away on military leave? 

The federal law governing how employers must handle employees on military leave, the Uniformed Services Employment and Re-employment Rights Act (USERRA), does not require an employer to pay an employee on military leave. 

The law does, however, forbid an employer from taking negative employment action against an employee for being on military leave. This means that an employee cannot be fired, demoted, or have his pay cut for taking military leave. In fact, an employer must count the time an employee is away on military leave toward the accrual of seniority. So, if an employee with four years of experience is away for a year on military leave, he must be paid like an employee with five years of experience when he returns. 

Moreover, the USERRA requires an employer to continue to make non-elective pension contributions to the employee’s pension fund while he or she is on military leave. These contributions should be the amount the employee would have received had he not taken leave. If this is not reasonably certain, the employer should use the employee’s average compensation during the 12-month period immediately before he left for military service. 

The USERRA also requires an employer to continue to allow an employee on military leave to remain part of the employer’s group healthcare plan. For those away for more than 30 days, the employee is not entitled to any employer healthcare benefits, like premium payments. For those on military leave for less than thirty days, the employee’s healthcare coverage must continue as if he were never away on leave. 

In addition to the USERRA, most states have laws prohibiting discrimination against employees because of their military service, which includes service in the state national guard. In Illinois, this law is called the Service Members Employment Tenure Act, and is almost identical to the USERRA. 

Public employers have greater responsibility for their employees who serve the military. The Military Leave of Absence Act, requires public employers to continue to pay employees on military leave due to their annual training.  For other types of leave, the law requires public employers to pay the difference between the employee’s regular wage or salary and the amount he receives from the military.

Public employers should also be aware of the Local Government Employees Benefits Continuation Act, which provides compensation for service members who are called to active duty, and the Municipal Employees Military Active Duty Act, which authorizes local governments to make pension payments on behalf of employees away on active duty in lieu of normal pension deductions. 

As these laws are somewhat complex, employers may wish to consult an experienced employment law attorney with questions pertaining to employees on military leave.