A former Union Pacific employee wasn’t entitled to judgment as a matter of law (i.e., a ruling in his favor) or attorneys’ fees after a job change following his return from military deployment, the U.S. 8th Circuit Court of Appeals (which covers Nebraska employers) recently decided, reversing the lower court’s opinion.
Facts
Rodolfo Quiles began working for Union Pacific as a general manager of safety analysis in 2014. He supervised other employees and received “D-band” level compensation. With A-band pay being the lowest, his salary slotted him just below E-band (or executive-level) compensation.
Quiles served in the U.S. Marine Corps Reserve and left Union Pacific in 2015 for voluntary deployment. While deployed, the company underwent a reduction in force (RIF), which eliminated all general manager titles, reclassifying many of them as directors instead. In addition, the company:
· Adjusted the general director position to require five years of field experience; and
· Hired a new employee for the position of general director of safety analysis, who Quiles believed was intended to be his replacement.
After the deployment, Quiles returned to work at Union Pacific under a new role as director of safety analysis. Although he received the same benefits and his compensation remained at the D-band level, he viewed the new job as a demotion. He claimed he was given less responsibility and status than in his previous position as general manager.
Quiles didn’t qualify for the general director job because he lacked the five years of field experience necessary to meet the new requirement for the position.
Unhappy with the new job title, Quiles became insubordinate, and his work performance declined, leading to his termination from Union Pacific in 2016. He then sued the company claiming it violated the Uniformed Services Employment and Reemployment Rights Act (USERRA) by effectively demoting him during his military leave.
How USERRA works
Under USERRA, military servicemembers are entitled to reemployment when they return from service that doesn’t exceed five years. Upon returning to work, they’re entitled to return to a job based on the “escalator position” principle, which places them in the job they “would have attained with reasonable certainty if not for the absence due to uniformed service.” The principle covers pay, benefits, seniority, and other job perks they would have attained if not for the period of service.
There are exceptions to the rule. You don’t have to reemploy a servicemember if:
· The company’s circumstances “have so changed as to make such reemployment impossible or unreasonable”;
· Employment would “impose an undue hardship” on your company; or
· The servicemember’s previous employment was “for a brief, nonrecurrent period” with no reasonable expectation it would continue for a significant length of time.
The district court ruled in Quiles’ favor, finding Union Pacific demoted him upon his return in violation of USERRA and awarding attorneys’ fees. The case proceeded to trial on the remaining claims, and the jury returned a verdict in the employer’s favor, concluding Quiles was fired for cause and not entitled to any damages.
8th Circuit’s ruling
After the favorable jury verdict, Union Pacific appealed the district court’s grant of judgment as a matter of law and award of attorneys’ fees to Quiles. In reversing the lower court’s decision, the 8th Circuit held it was impossible to reemploy him to his previous position because:
· It had been eliminated; and
· A reasonable jury could find “Union Pacific attempted to fit Quiles into an appropriate job within the corporation’s reorganized structure upon his return from deployment” in accordance with the escalator-position principle and for which he was qualified.
Because Quiles wasn’t entitled to judgment as a matter of law, the court further held he didn’t qualify as a prevailing party for purposes of attorneys’ fees. Quiles v. Union Pac. R.R. Co., Inc., No. 19-3489 (8th Cir., July 6, 2021).
Bottom line
You should take care in responding to servicemembers’ requests for leave and be aware of USERRA’s strict requirements. When in doubt, call your employment law attorney.
Bonnie Boryca is one of Erickson Sederstrom’s employment attorneys and can be reached at boryca@eslaw.com or 402-397-2200. This article was written with assistance of law clerk Ali Clark, who will be joining the firm as an associate in the fall of 2022.