Landis v. Pinnacle Eye Care, LLC, the Sixth Circuit Court of Appeals recently held that an agreement to
arbitrate claims is enforceable under the Uniformed Services Employment
and Reemployment Rights Act of 1994 (USERRA). Although the Sixth Circuit
does not have jurisdiction over the courts of Georgia, and a lower-level
federal court in Georgia has held to the contrary, the Eleventh Circuit
has not yet weighed in on the issue, so the case may be relevant if the
issue reaches the Eleventh Circuit.
In the case, Dr. Timothy Landis signed an employment agreement in which
he agreed to resolve all disputes related to the agreement through arbitration.
During his employment, he was called to military duty in Afghanistan as
a member of the Indiana National Guard. Although he contended that the
parties had amended the employment agreement prior to his departure for
Afghanistan, there was no formal amendment to the agreement. On his return
from active duty, the employer refused to honor the alleged revised agreement,
demoted Landis, and threatened to fire him if he had any future involvement
in the military.
In response, Landis filed an employment discrimination claim under the
USERRA, claiming that his employer had discriminated against him based
on his military service. The lower court granted the employer’s
motion to stay the case and ordered that it be arbitrated based on the
arbitration clause contained in the employment agreement, holding that
the USERRA did not preempt the arbitration clause.
On Landis’ appeal, the court first noted that United States Supreme
Court has long held that statutory claims are generally subject to being
arbitrated unless Congress has clearly expressed its intention to preclude
arbitration, and that the party opposing arbitration has the burden of
showing a waiver by Congress.
Analyzing the USERRA and its legislative history, the court found that
there is nothing that indicates that Congress intended to limit the applicability
of arbitration to disputes under the USERRA. Although Section 4302(b)
of the statute does contain a provision that states that the law “supersedes
any state law . . . contract, agreement, policy, plan, practice or other
matter that reduces, limits, or eliminates in any manner any right or
benefit provided by this chapter, including the establishment of additional
prerequisites to the exercise of any such right or receipt of any such
benefit,” the court concluded that because this provision does not
mention arbitration, the statute does not preclude arbitration.
Frankly, we believe the decision in the Georgia federal district court case of
Breletic v. Caci, Inc.-Federal, is a much better reading of the USERAA. In
Breletic, the Court held that Section 4302(b), along with some language in the
statute’s legislative history, reveal that the “USERRA preempts
arbitration agreements purportedly covering claims arising under the USERRA.”
Should the issue reach the Eleventh Circuit, we’ll be on it for you.