How to avoid legal pitfalls when hiring veterans

Avoid these typical legal challenges with hiring veterans.

With the unemployment rate for the most recently returned group of veterans at 10 percent as of October 2013—higher than any other veteran group and the national unemployment rate of 7.3 percent, hiring initiatives, such as the White House’s Joining Forces campaign, hold great promise in transitioning veterans to the civilian workforce. The skill sets required for the rail and transportation industry are a very good match for many of the veterans.

In fact, out of the top 100 “military friendly” employers rated by a respected ratings organization, 11 are transportation companies.

Now is a critical time for businesses to hire veterans, but private employers need to consider both the legal benefits and challenges associated with hiring veterans.



Employers benefit from hiring veterans in a number of ways, including tax credits.

President Obama’s 2011 Returning Heroes and Wounded Warrior Tax Credits allow businesses to receive $3,000 to $9,600 per veteran hire, depending on the veteran’s circumstances. Under the Returning Heroes Tax Credit, businesses receive a $2,400 per veteran tax credit for hiring veterans who have been unemployed between four weeks to six months and a $5,600 per veteran tax credit for veterans who have been unemployed for more than six months. The Wounded Warriors Tax Credit allows businesses to receive up to $9,600 per disabled veteran hired if the veteran was unemployed longer than six months and has a service-related injury.

While these tax credits were set to expire at the end of 2013, the proposed budget for the fiscal year 2014 attempts to create a permanent tax benefit for hiring veterans.



While employment laws provide some great incentives, private employers should beware of potential legal pitfalls in the hiring process, such as avoiding preferential treatment to veterans or averting discrimination claims based on disabilities and making reasonable accommodations.

Every business should recognize that private employers generally cannot show preference in the hiring of veterans per Title VII of the Civil Rights Act of 1964, 42 U.S.C. 2000e, which prohibits discrimination in employment decisions, including hiring, termination, compensation, promotion because of race, color, sex, national origin or religion. Specifically, preference to veterans is considered unlawfully discriminatory due to the potential disparate impact on female applicants.

This is a result of the long-standing federal statutes, regulations and policies that have excluded women or limited women’s eligibility to serve in the armed forces. Consequently, preference in hiring veterans tends to operate to the advantage of men.

There are exceptions to this rule. According to Section 712 of Title VII, “Nothing contained in [Title VII] shall be construed to repeal or modify any federal, state, territorial or local law creating special rights or preference for veterans.”

Therefore, if the right to veterans preference is created by a federal, state, territorial or local law—as in the states of Washington and Minnesota, private employers can show preference to veterans in their hiring upon meeting certain criteria.

Washington law provides the following:

(1) The legislature intends to establish a permissive preference in private employment for certain veterans. (2) In every private, nonpublic employment in this state, honorably discharged soldiers, sailors and marines who are veterans of any war of the United States, or of any military campaign for which a campaign ribbon has been awarded, and their widows or widowers, may be preferred for employment. Spouses of honorably discharged veterans who have a service connected permanent and total disability may also be preferred for employment. These preferences are not considered violations of any state or local equal employment opportunity law, including but not limited to any statute or regulation adopted under chapter 49.60 RCW (3) “Veteran” has the same meanings as defined in RCW 41.04.005 and 41.04.007, and includes a current member of the national guard or armed forces reserves who has been deployed to serve in an armed conflict.

This content continues onto the next page...

We Recommend