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Ninth Circuit Court of Appeals Affirms USERRA FedEx Victory

Huhmann v FedEx, et al., Southern District of California, Case No. 3:13-CV-00787-BAS-NLS

On November 2, 2017, the United States Court of Appeals for the Ninth Circuit affirmed a judgment in favor of the plaintiff, Dale Huhmann, who alleged that upon his return from military service with the United States Air Force Reserve, he was entitled to a higher signing bonus from FedEx under the Uniformed Services Employment and Reemployment Rights Act. (USERRA)

First, the Ninth Circuit held that arbitration was not required because the right awarded by USERRA neither arose out of nor relied on an interpretation of the parties’ collective bargaining agreement, and so the parties’ dispute was not a “minor dispute” under the Railway Labor Act.

The panel then held that in analyzing the plaintiff’s USERRA claim, the district court correctly considered first, whether the plaintiff had established that his military service was a “substantial or motivating factor” to cause an adverse employment action, and second, whether the defendant employer had established an affirmative defense that it would have taken the same action without regard to the military service.

The Court held that the district court properly used the reasonable certainty test, asking whether it was reasonably certain that the plaintiff would have qualified for a higher bonus had he not left for military service, as an aid to the burden-shifting analysis. The district court also properly relied on the escalator principle, which provides that a returning service member should not be removed from the progress of his career trajectory. The Court concluded that the district court did not clearly err in finding that the plaintiff was reasonably certain to have achieved the higher bonus status had he not left for his military service, both as a matter of hindsight and as a matter of foresight.

The Court also affirmed the district court’s conclusion that the bonus was, in part, a seniority-based benefit, and the plaintiff’s claim was not barred by 38 U.S.C. § 4316(b)(1).

The Ninth Circuit’s opinion will require FedEx to pay Mr. Huhmann the full signing bonus of $10,300, plus pre-and post-judgment interest, attorneys’ fees including those expended on FedEx’ appeal, and litigation costs. You can read the court’s opinion here and watch the oral argument here.