CAN A USERRA RELEASE BE BULLET-PROOF? by Kelly Ann Bird and Zeenat - PDF document

CAN A USERRA RELEASE BE BULLET-PROOF? by Kelly Ann Bird and Zeenat Basrai statute; and 4302(b), 3 which provides In response to a client’s request tort or contract, based upon public poli- that USERRA will supersede any con- cy,” as well as a catch-all provision for for advice about the risks tract or agreement that reduces, limits, or “any and all claims alleging …wrongful associated with an involuntary termination.” 5 The agreement further eliminates any right or benefit provided employee separation, by USERRA. advised Perez “to consult with an advi- management-side employment sor of [his] choice” 6 before executing The scant case law construing these attorneys generally run down a provisions has resulted in confusion the agreement, and gave Perez seven checklist that includes the over whether USERRA claims can be days to review and execute the agree- waived at all and, if so, what the waiver ment. Finally, the court noted that Perez following: Has the employee must include to be valid. A brief review was a college graduate who was fluent recently been injured? Sought of the cases provides some guidance, in English, “read the agreement more workers’ compensation benefits? but also leaves some open questions. than once,” and understood that he had Taken a protected leave for Prior to 2010, two cases, neither of a choice to execute the agreement or family or medical reasons? which establishes federal precedent, not, but that without it he would not Reported a violation of informed this discussion. receive severance pay. First, in 2007, a California state Nevertheless, the appeals court con- workplace policies or a law or court addressed the issue of the validity cluded, USERRA would not permit a regulation? of a USERRA release . In Perez v. Uline, contractual waiver of rights. Inc., 4 the Court of Appeal of California, Next, in the unpublished 2008 deci- In recent years, management employ- Fourth Appellate District, Division sion Jolley v. Department of Housing and Urban Development (HUD), 7 the ment attorneys have also been asking Three, considered whether a USERRA whether the employee has served in the suit was barred by a broad release of United States Court of Appeals for the armed forces or has taken, or been eligi- claims. Perez, who had been out of Federal Circuit reached a contrary deci- ble to take, a military leave. Unfortunate- work on Reserve service and was sion, concluding USERRA claims ly, an affirmative response to this last immediately terminated from employ- could be released by waiver language in inquiry now causes concern that the usu- ment at Uline after his attempt to return a settlement agreement. Jolley, a veter- ally recommended cure-all for trouble- to work, executed a one-and-a-half page an, had filed an Age Discrimination in some separations, namely a separation severance agreement and release that Employment Act (ADEA) claim against agreement with consideration provided afforded him six weeks’ salary in HUD after he was passed over for vari- in exchange for release of all potential exchange for releasing his employer, ous HUD positions. In 2004, Jolley and claims imaginable, will not, in fact, fully Uline, from all claims. After signing the HUD settled the claim. In exchange for shield a client from liability for wrongful agreement and receiving the severance $60,000 and appointment to a position termination. pay, Perez sued Uline for, among other he sought, Jolley agreed to waive and The reason for this uncertainty is claims, wrongful termination in viola- release “all claims arising from any because the Uniformed Services tion of USERRA. Although the trial facts” through the effective date of the Employment and Reemployment Rights court ruled in favor of Uline, finding agreement. 8 Act (USERRA), 1 the federal statute that that Perez had released all of his claims Over three years later, Jolley filed a protects civilian job rights and benefits through the severance agreement, the Merit Systems Protection Board for veterans and active and inactive appeals court found that the plain lan- (MSPB) appeal, claiming that HUD’s members of the Armed Forces, Reserves, guage of Section 4302(b) provides that failure to move him into certain posi- National Guard or other “uniformed ser- a contract may not limit the protections tions (specifically identifying one of the vices,” has been interpreted as both per- of USERRA, and thus the severance same positions at issue in the resolved mitting and prohibiting a waiver of agreement did not waive Perez’ rights ADEA claim) violated USERRA. The claims. At issue are two sections of under USERRA. administrative court concluded that the USERRA: 4302(a), 2 which provides that The claims waived in the agreement MSPB action was barred by the 2004 USERRA will not supersede or nullify included a “comprehensive but non- settlement agreement between HUD any contract or agreement that is more exclusive laundry list of named federal and Jolley. beneficial than rights provided by the and state laws,” and specified “claims in On appeal, the Court of Appeals for 22 N EW J ERSEY L ABOR AND E MPLOYMENT L AW Q UARTERLY , Vol. 32, No. 4