Military Service Benefits: SCRA and USERRA

Because of the sacrifices that military service members make, the Servicemembers' Civil Relief Act (SCRA) and the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) provide service members with benefits for financial relief and job protection.

The SCRA is an expanded version of the 1918 Soldiers' and Sailors' Civil Relief Act (SSCRA). The SCRA benefits anyone on federal active duty in the Armed Forces of the United States. It also applies to members of the National Guard and reservists. The law relieves military service members from certain civil obligations while on active military duty.

The USERRA bans employers from discriminating against employees who leave civilian employment to serve in the military. The USERRA requires the employer to reinstate the employee if the absence is five years or less.

Interest Rate Cap

Under the SCRA, a service member may qualify for a 6% cap on debts and financial obligations. This does not apply to student loans guaranteed by the federal government. Qualifying debt includes mortgages and credit card debt incurred by the service member or spouse. The provision applies if:

1. The service member acquired the debt before beginning active duty, and
2. The service member's military commitment materially affects the ability to pay the debt at the pre-service interest rate.

To get the rate cap, the service member must provide the creditor with the following proof:

• Military orders
• Pay stubs
• Proof that a reduction in income happened after active service

The creditor can challenge the claim in court but must grant the cap until a court rules otherwise. When the service member is no longer on active duty, the creditor can reset the interest rate.

Termination of Rental Agreements and Leases

The SCRA permits service members to terminate a residential or commercial rental agreement or lease after signing if:

1. The service member enlists in active military duty during the term of the tenancy or
2. The service member gets orders to permanently change location or deploy for more than 90 days.

The service member can terminate the lease by mailing a written notice. They must also include a copy of the military order to the landlord.

Month-to-month rental agreement: After the service member gives notice, the tenancy ends 30 days after the due date of the next rent payment.

Lease agreement: A yearly lease will end on the last day of the month following the month that the service member gives proper notice.

Termination of Motor Vehicle Leases

The SCRA also allows a service member to terminate a motor vehicle lease if, after signing the lease:

1. The service member gets called for active duty for not less than 180 days of service or
2. The military member gets orders to permanently change location or deploy for not less than 180 days.

The service member must make the termination request in writing. They must also provide a copy of the military orders. The service member must return the vehicle to the owner within 15 days of the termination notice.

Protection from Eviction

The SCRA protects military service members from eviction for not paying rent. This applies regardless of whether the rental of the unit happened before or after military service. The provision applies if:

1. The service member or their dependents occupy the unit during the member's military service, and
2. The rent does not exceed $9,106.46 monthly (adjusted yearly for inflation).

Even if the provision in the SCRA applies, the landlord can still file an eviction action against the occupants of the dwelling. The court can grant up to a three-month stay or enter an "order as may be just." The court will consider whether the service member's ability to pay the rent is materially affected by the military service. The landlord may proceed with the eviction lawsuit if the court does not issue a stay.

Protection Against Pending Trials

Under the SCRA, service members may request a stay of legal action during their military service, deployment, or tour overseas.

Stay of court proceedings: A court may postpone an action for 90 days if the person is in military service or was released or terminated from military service within 90 days.

Stay of execution: A court may stay an action to carry out judgments, court actions, garnishments, and attachments against a person engaged in military service or previously in military service within the last 90 days. A court can deny the request if the military service does not affect the ability of the member to follow the execution of the judgment.

Default judgment: If a court issues a default judgment against a service member, the case can reopen within 90 days after the end of military service if it can be shown that the service member had a legal defense and military service affected the ability to make a defense.

Statute of limitations: The law excludes military service time from the limitations period for filing a lawsuit.

Installment Contract Protection

Provisions in the SCRA also protect service members who enter into installment agreements. To qualify for the benefits of installment protection, the service member must show that:

1. The service member entered into an installment agreement for real or personal property before active duty in the military and
2. Military service substantially affects the ability of the service member to make payments.

Suppose a service member qualifies under the provision. In that case, the lender may not terminate the contract or repossess the property for nonpayment or breach of contract if a court order does not provide otherwise.

In actions for foreclosure, the SSCRA protects service members if the member meets both of the requirements and the following:

1. Relief is based on obligations under the mortgage;
2. The service member or a family member owned the property before active military service, and
3. The service member or a family member owned the property when the lender initiated an action for relief.

Reemployment Under Federal Law

The U.S. Department of Labor (DOL) oversees USERRA. It protects those departing civilian jobs for U.S. military service from employment discrimination and upholds their employment rights. Employers must reemploy the service member if:

1. Before leaving, the employee gave the employer advanced written or verbal notice of the military service (unless impossible or unreasonable because of military necessity);
2. The employee's absence because of military service did not exceed five years;
3. The employee was given an honorable discharge at the end of military service, and
4. The employee applies for reemployment within a specified time.

USERRA requires that employers make reasonable efforts to reinstate service members into suitable positions. The USERRA bans employers from reinstating service members into the same position they served in before entering the military. Instead, the employer must determine what position the employee would have been in if continuously employed during military service. The employer can't fire the service member for up to one year after reinstatement without cause.

Exceptions to USERRA

Some exceptions exist to a service member's right to reinstatement under the USERRA. The employer does not have to rehire a returning service member if:

1. Workplace changes make it unreasonable or impossible to reinstate the employee;
2. Reemployment of the returning service member would create an undue hardship on the employer; or
3. The service member's employment before service was brief, and there was no reasonable expectation that employment would continue for a long time.

Reemployment Under State Law

Most states have laws that also ban discrimination against those who serve in the military. Many states require employers to grant leave for those called for active military service and reinstate the returning military member. Most states only require reemployment if the employee:

1. Received an honorable discharge;
2. Can provide proof of the satisfactory completion of military service and
3. Applies for reemployment within a certain time.

Legal Help

If you need help accessing military service benefits like the SCRA and USERRA, consult with an experienced attorney. An attorney can ensure that you get the necessary legal assistance to access the benefits you are entitled to as a servicemember.