Tag Archives: military

Third Circuit Court dismissed False Claims Act action where fraud was against military members, not U.S.

The Third Circuit Court of Appeals recently issued a decision under the False Claims Act, under which an insurance agent sued an insurance company and a bank on behalf of the United States, claiming that these two companies submitted false claims to the U.S. government.  Generally, if the government recovers money under a false claims suit filed by a third party, that third party may also recover money.

According to the lawsuit, the insurance company sold life insurance policies to enlisted personnel, stating that the policies were actually savings accounts to avoid military regulations limiting the use of the military allotment system to pay life insurance premiums.  The insurance company argued that the conduct that the insurance agent complained of did not rise to the level of a false claim against the government – that the insurance company was not actually trying to falsely claim money from the U.S. government.

The Third Circuit agreed with the insurance company.  Payments made via the military allotment system are made from the salaries of military members, not from government funds on behalf of the United States. Since the actions of the insurance company could not cause monetary loss to the United States government, those actions did not involve a claim against the U.S. government. An action under the False Claims Act must involve a claim against the U.S. government where the government might suffer economic loss. Thus, the court ruled that the claim was properly dismissed, even though there might have been fraud against members of the military.

United States of America ex rel Sanders v. American-Amicable Life Ins. Co. of Texas, et al., No. 07-3429 (3d Cir. 2008).


Leave a comment

Filed under False Claims Act

Employee eligibility: What you need to know about the new FMLA regulations

Yesterday, the Department of Labor released new final FMLA regulations that will take effect on January 16, 2009. The Labor Department developed these regulations because of the National Defense Authorization Act for Fiscal Year 2008 (NDAA), which President Bush signed last January, and because of parts of the current regulations being invalidated by various court decisions. The regulations detail two new military family leave entitlements. Here is a summary of the important changes that you should be aware of:

Employee Eligibility for FMLA – the 12-month rule

One of the requirements for eligibility is that an employee must work for that employer for at least 12 months. The new rule says that those 12 months need not be consecutive, but that employment before a 7-year break in service need not be counted. 29 CFR 825.110(b)(1). The rule provides for two exceptions: 1) Time served fulfilling National Guard or Reserve duty counts toward the 12-month employment requirement; and 2) Where there is a written agreement concerning the employer’s intention to rehire the employee after the break in service. 29 CFR 825.110(b)(2). If an employer chooses to count someone’s employment prior to a 7-year gap, it must do so for all employees with a similar break in service.  29 CFR 825.110(b)(4).

Working 1,250 hours in 12 months

Another eligibility requirement is that an employee must have worked at least 1,250 hours in the 12 months immediately preceding the beginning of the FMLA leave. A new regulation provides that an employee who is re-employed under USERRA after military service must be credited with the hours they would have worked but for the military service. 29 CFR 825.110(c)(2).

The Department of Labor clarified the eligibility rule to reflect that an employee who is out on non-FMLA leave may become eligible for FMLA leave during that time, thus turning the last part of the non-FMLA leave into FMLA leave. 29 CFR 825.110(d).

FMLA leave for members of the military and their relatives

A couple of paragraphs were added regarding required leave for employees or relatives who are members of the military.  Employers must grant FMLA leave to employees where there is a “qualifying exigency” arising from the fact that their child, parent, or spouse is a “covered military member on active duty” or has been notified of an impending call to active duty.  FMLA leave must also be granted to an employee to care for an injured servicememer who is a parent, spouse, child, or next of kin. 29 CFO 825.112(5), (6).

What’s a qualifying exigency?

The “qualifying exigency” referred to in the prior paragraph can be: 1) A short-notice deployment; 2) A military event or related activity; 3) Alternative childcare or school arrangements that need to be made because of military active duty status; 4) Financial or legal arrangements because of military active duty; 5) Counseling for the covered military member; 6) Short-term rest and recuperation of the military member; 7) Attending post-deployment activities sponsored by the military; or 8) Other activities arising out of military duty. 29 CFR 825.126.


These are the main changes to the eligibility regulations of the FMLA.  As you can see, most of the changes have to do with members of the military and their relatives.  Many employers might argue that this puts a lot of the burden of leave time from employment on the employer, and they’d be right.  However, the heaviest burdens of military service are still being carried by individual members of the military who are deployed overseas.  So a spreading of the burdens, in a sense, is not such a bad thing.

Leave a comment

Filed under FMLA, USERRA

Is the re-employment of returning military reservists too much for employers to handle?

There was an interesting piece on “60 Minutes” tonight about military reservists having a tough time getting back their old employment positions after having served on active duty, despite a law (called USERRA) requiring employers to reinstate these employees in their old positions after they return from active duty.

Members of the National Guard and the Reserves serve on active duty when they are called by their government to do so, taking huge personal risks and often making great sacrifices to do so.  Shouldn’t employers do their part by making some sacrifices as well, particularly when the law requires them to do so?  Tonight’s report pointed out that some of America’s largest employers have faced lawsuits for alleged USERRA violations, naming UPS, Wal-Mart and American Airlines as examples.

One employer interviewed for the report pointed out that the military was essentially shifting costs to private employers by putting more and more reservists on active duty.  The cost-shifting point is valid, but this is a sacrifice employers must be willing to make.

For more discussion of USERRA:

The Ohio Employer’s Law Blog has a good overview of the right to re-employment under USERRA.

The Workplace Prof Blog highlights a recent USERRA case holding that an employee who claims that his re-employment rights were violated under USERRA does not need to prove discrimination similar to a traditional employment discrimination case (such as one based on sex or race).  And the blog points out that we are likely to see a rise in these cases.

At law.com, there’s a discussion of whether agreements to arbitrate USERRA claims are enforceable, concluding that there are differences of opinion in the courts on this issue.  A recent case description on the arbitrability of USERRA claims is over at the LawMemo Arbitration Blog.

The recent case law on arbitration clauses affecting USERRA as well as discussion of a case involving a state as the employer (holding that federal courts don’t have jurisdiction in this type of case) are discussed at Jottings By An Employer’s Lawyer.

A U.S. Dept. of Labor elaws Advisor on USERRA can be found here.

Leave a comment

Filed under USERRA