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Jan 08, 2018

Employee on military leave qualified for higher bonus upon return

Employee BenefitsLeave Laws 

A pilot who would have qualified for a higher pay grade had he not been on military leave should have received a bonus upon his return at the rate for the higher pay grade, ruled the U.S. Ninth Circuit Court of Appeals.

The pilot (a union member) was selected by his employer to receive training to operate “wide-body” aircraft, which would place him in a higher pay grade. Shortly before the training began, he was called up by the Air Force and served for three and a half years. While he was gone, his employer and the union negotiated a new collective bargaining agreement (CBA). The pilots received a CBA ratification bonus based on their level of training certification: $7,400 for narrow-body aircraft and $17,700 for wide-body aircraft.

The “Escalator” Position

Upon the pilot’s return from military leave, the employer paid the bonus, but at the $7,400 level. The pilot sued, claiming he should have received $17,700. The court sided with the employee. Under the Uniformed Services Employment and Reemployment Rights Act (USERRA), returning military veterans are generally entitled to be reinstated to the “escalator” position that they would have held if their time with the employer hadn’t been interrupted by military service. This means that if employees would have been promoted had they continued to work, they would be entitled to be promoted upon returning to work from military leave. The court said it was reasonably certain the employee would have completed the training for the wide-body aircraft before the CBA was ratified. In fact, upon his return from leave, he resumed and successfully completed his training in less than three months (Huhmann v. Federal Express Corp. dba FedEx Express, 9th Cir, Nov. 2017).

Tips for Employers

Entitled to Benefits – and Promotions - While On Military Leave

The general rule for employees on military leave is that during their leave they are entitled to any non-seniority benefits (such as holiday pay) that are provided to people on comparable leave, and upon their return to work they are entitled to return to an “escalator” job which includes any seniority-based benefits. For purposes of calculating seniority, the military leave counts as time with the employer. In this case, the bonus was a seniority-based benefit which the employee was entitled to upon his return. For further guidance, see our Legal Guide, “Veterans’ Employment Rights Law.”

If you have additional questions about how to handle pay during and after an employee is on leave, please reach out to your Vigilant employment attorney for guidance. Not a member? Explore our unlimited, flat rate monthly employment law advice services.

This website presents general information in nontechnical language. This information is not legal advice. Before applying this information to a specific management decision, consult legal counsel.