6th Circuit Rules Village May Have Violated USERRA

The Sixth Circuit Court of Appeals has reversed the decision of a district court regarding discrimination in violation of the Uniformed Services Employment and Reemployment Rights Act (USERRA). The Sixth Circuit reversed the district court’s summary judgment in favor of the Village of Vicksburg, Michigan, on all of David E. Eichaker’s claims. Eichaker sued under USERRA, claiming that the Village had discriminated against him in various ways because of his military affiliation.

Eikhaker was hired as a police officer at the Village of Vicksburg. He was a reservist and often away from his work due to military service. He stated that his employer improperly considered his military service in various employment decisions and then demoted him when he sought protection under USERRA. He also held that the employer charged him without his consent for continuing his group health plan coverage while he was on military leave and covered by military provided health insurance.

The district court ruled for the Village of Vicksburg without a trial, finding that the employee’s military service was not a motivating factor in the employment decisions. The district court also decided the employee did not have a claim under USERRA regarding the way the employer had administered his health benefits. The district court concluded that while USERRA prohibits employers from improperly canceling coverage during military service, it does not prohibit an employer from continuing health coverage and charging for payments when a service member has not given consent to cancel.

On appeal, the Sixth Circuit reversed and sent the case back to the district court for further proceedings, ruling that there was sufficient evidence of the employer’s military discrimination to show that the employer violated USERRA. Regarding the health plan claim, the Sixth Circuit agreed that USERRA does not ban an employer from continuing coverage and charging for a service member’s health coverage. It does, however, prohibit it from stopping an employment benefit based on military service or an employee seeking USERRA’s protections.

The Sixth Circuit instructed the district court to reassess the employer’s provision of free health insurance during the employee’s prior deployments. There was also instruction to see if such a move was a practice in the context of USERRA during previous military leave or if it was retaliation for Eichaker trying to invoke the protections and if that became the motivating factor in the Village’s decision to bill Eichaker during his last deployment.

This case should serve as a reminder to employers not to discriminate against employees based on their military obligations.

About John Garner

John Garner has over thirty five years of experience in employee benefits. He specializes in compliance, health care reform, the Health Insurance Portability and Accountability Act (HIPAA), the Consolidated Omnibus Budget Reconciliation Act (COBRA), and the Employee Retirement Income Security Act (ERISA). He helps clients with life, health, and disability benefits, cost containment, flexible benefits, and claim consulting.

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