Member Article

On March 22, 2011, the Fifth Circuit ruled that the Uniformed Services Employment and Reemployment Rights Act (“USERRA”) does not support a cause of action for hostile work environment. This is the first ruling from any Circuit Court regarding the issue.

USERRA, a federal statute that establishes rights for members of the National Guard and Reserve, applies to all public and private employers, regardless of size. USERRA generally prohibits discrimination against employees based on past, current, or future military service.

In Carder v. Continental Airlines, Inc., pilots of Continental Airlines (“Continental”) filed a class-action complaint against Continental, asserting several claims under USERRA, including a claim that Continental created a hostile work environment through harassing, discriminatory, and degrading comments relating to and arising out of their military service. The pilots alleged that their supervisors repeatedly made negative and derogatory comments about their military service and leave obligations and accused the pilots of taking advantage of their USERRA rights to avoid their duties for Continental. Continental moved to dismiss the harassment portion of the complaint, alleging that USERRA only prohibits employers from interfering with the granting of some employment benefit. The Fifth Circuit agreed.

The Fifth Circuit’s analysis hinged on the interpretation of the term “benefit of employment.” USERRA’s prohibition against the denial of a “benefit of employment” is found in Section 4311(a) of the statute, which states:

A person who is a member of, applies to be a member of, performs, has performed, applies to perform, or has an obligation to perform service in a uniformed service shall not be denied initial employment, reemployment, retention in employment, promotion, or any benefit of employment by an employer on the basis of that membership, application for membership, performance of service, application for service, or obligation.

Whether USERRA creates a cause of action for hostile work environment depends on the definition of “benefit of employment,” which is defined in a separate section of the statute. The terms “benefit of employment,” “benefit” and “rights and benefits” are collectively defined as:

any advantage, profit, privilege, gain, status, account, or interest (including wages or salary for work performed) that accrues by reason of an employment contract or agreement or an employer policy, plan, or practice and includes rights and benefits under a pension plan, a health plan, an employee stock ownership plan, insurance coverage and awards, bonuses, severance pay, supplemental unemployment benefits, vacations, and the opportunity to select work hours or location of employment. See 38 U.S.C. § 4303(2).

Because the definition of “benefit of employment” or “benefit” does not refer to harassment, hostility, insults, derogatory comments or any other similar words, the Fifth Circuit reasoned that the express language of the statute does not provide for a hostile work environment claim.

In addition, after considering the statute’s legislative history, underlying policy objectives, and comparing the language of USERRA to other federal anti-discrimination statutes, the Fifth Circuit concluded that Congress did not intend to create a cause of action under USERRA for harassment of service members.

Courts have previously relied on the phrase “terms, conditions, or privileges of employment”—and occasionally the single term “condition”—in other anti-discrimination statutes to infer a cause of action for hostile work environment. This phrase and the term “condition” is notably absent from the definition of “benefit of employment” under USERRA. Further, the DOL regulations implementing USERRA make no mention of employer harassment on the basis of military service, creation of a hostile work environment, or any other type of comparable claim.

While a claim for hostile work environment is not created under USERRA, the Fifth Circuit noted in dicta that in situations where an employer makes service members’ employment so intolerable that they are forced to quit, the service member could likely lodge a claim for constructive discharge under USERRA. Thus, although lesser levels of harassment are not actionable as a hostile work environment claim, if the harassment rises to the level of “some intolerable form of harassment” that forces the employee to quit (i.e., constructively discharged), the employee would likely have relief and protection under USERRA.

While some states provide protection from discrimination based on an individual’s military status, Texas does not currently provide this protection. Employers should be familiar with the law in their own states regarding this issue. Here, at least, the Fifth Circuit has narrowed the scope of claims against which employers must defend under USERRA. Nevertheless, it remains to be seen whether other United States Circuit Courts will follow suit.

If you have any questions, please visit the Haynes and Boone Labor and Employment Practice page of our website or contact one of the attorneys listed below.