On May 16, The U.S. Court of Appeals for the Sixth Circuit held that a Marine Corps reservist could not sue a Michigan manufacturer under the Uniformed Services Employment and Reemployment Rights Act because he failed to file the action within 180 days as required by an employment agreement with his former employer (Oswald v. BAE Indus. Inc., 6th Cir., No. 11-1119, unpublished opinion 5/16/12).
Writing for the court, Judge Eric L. Clay said Jerome Oswald conceded that a 2008 amendment that eliminated limits on USERRA actions could not be applied to his lawsuit, which challenged his termination by BAE Industries Inc. in 2007. The “narrow question” before the court, Clay said, was whether Oswald was subject to a four-year statute of limitations that applied before 2008 or the 180-day time limit he accepted when he began work for BAE.
The appeals court rejected Oswald’s claim that USERRA overrode his employment contract, and held a lower court properly granted summary judgment to the employer based on Oswald’s failure to file a lawsuit within 180 days of his discharge.
According to the decision, Oswald began working for BAE in 2005 as a manufacturing engineer. In July 2006, Oswald was ordered to serve in Iraq. He alleged that when he informed BAE, a company manager indicated his disapproval “by his demeanor and non-verbal conduct.”
After a year of military service, Oswald returned to BAE in July 2007. He alleged that his duties and responsibilities were drastically reduced, and he was not given any tasks with deadlines or completion dates. The absence of deadlines was a sign that BAE did not intend to retain him for long, Oswald alleged.
According to Oswald, he was transferred and demoted to maintenance duties within a month of his return to work, and he was then discharged on Sept. 14, 2007, in an action the company claimed was dictated by economic conditions.
The Sixth Circuit said Oswald filed a February 2008 request that the Labor Department investigate his discharge, but DOL declined to pursue the claim. Oswald filed a lawsuit in the U.S. District Court for the Eastern District of Michigan alleging that he was fired in violation of USERRA and the Michigan Military Act, which provides similar employment protections.
BAE filed a motion for summary judgment, arguing the lawsuit was untimely because of Oswald’s failure to file it within the 180-day time limit required by his employment agreement.
Oswald’s agreement with BAE allowed him to pursue employment-related claims in any available forum, without first filing grievances or proceeding to arbitration.
However, the agreement required that “any action, claim or suit” had to be brought within 180 days. “I waive any and all limitations periods to the contrary,” Oswald stated in the agreement.
Citing the 180-day provision and noting that Oswald’s lawsuit was filed nearly three years after his discharge, the trial court granted judgment in favor of the company.
The appeals court said until 2008, when USERRA was amended by the Veterans’ Benefits Improvement Act (VBIA), the military leave statute contained no statute of limitations. Claims brought under USERRA were subject to a four-year general limitation, 28 U.S.C. § 1658(a).
VBIA amended USERRA to provide that for claims filed under the law in court or with the Merit Systems Protection Board, “there shall be no limit on the period for filing the complaint or claim.”
Oswald conceded that VBIA did not have retroactive effect, but he argued that his lawsuit was filed within the four years permitted by Section 1658(a) and was therefore timely, but the court disagreed, finding that the 180-day limit in Oswald’s employment agreement was controlling. Clay noted that the USERRA provides that the act “supersedes” any state law, as well as any “contract, agreement, policy, plan, practice, or other matter” that “reduces, limits, or eliminates” any benefit provided by the statute.
The Sixth Circuit has read the statute to mean that USERRA precludes limitations on the substantive rights of protected employees, “but not their procedural rights,” Clay wrote.
Stating that the court has considered limitation periods to be procedural issues, Clay wrote “Plaintiff’s employment contract “only shortens the time frame” for filing a lawsuit under USERRA. The 180-day limit on filing employment-related actions was a modification of Oswald’s procedural rights that was permitted by the military leave act, the Sixth Circuit found.
The court added that Section 4303(b) of USERRA gives the statute precedence over contractual provisions that impose “additional prerequisites to the exercise” of statutory rights or the receipt of statutory benefits, but Clay said “[c]onsent to a shorter time frame for filing a claim in court does not fall within this definition.”
“Although we are sympathetic to Plaintiff’s situation,” the court said, “especially in light of the VBIA amendment that no limitations period whatsoever is to apply to USERRA claims, we are bound to apply the pre-VBIA version of USERRA in deciding that the shortened filing period in Plaintiff’s employment contract was permissible.” 05.21.2012