A newly enacted Minnesota statute provides that a “private nonpublic employer” may grant a preference to veterans in hiring and promotion.  See S.F. No. 1599.  A preference may also be granted to the spouses of certain disabled veterans or the surviving spouse of a deceased veteran.  The term “veteran” under the statute includes those who are honorably separated from the armed forces and who have met certain active duty criteria.  The bill was cited as one of a number of measures to expand opportunities for veterans and address an extremely high unemployment rate for veterans.

Minnesota law has long required public employers to grant preferences to veterans in hiring and promotion and, with some exceptions, prohibits public employers from removing veterans from their positions except for incompetency or misconduct after a hearing.  See Minn. Stat. § 197.455.  The new law is permissive rather than mandatory for private employers, although all employers should continue to keep in mind any other obligations they may have, including those to rehire veterans under the Uniformed Services Employment and Reemployment Rights Act (“USERRA”).

The new law addresses hiring and promotion, but not removal from a position.  It expressly states that granting a preference will not violate local and state human rights laws.  That language should protect employers from claims that granting a preference in hiring or promotion constitutes gender or age discrimination under the Minnesota Human Rights Act.  The new law does not, however, expressly override other claims, including those under federal equal employment opportunity laws.  Whether it will be interpreted as precluding those claims is unclear at this point.  In the past, purely voluntary preferences, have been subject to challenge under Title VII and certain other federal laws, while several challenges to preferences granted as required under state veteran’s preference statutes have been rejected.

Takeaway: Public and private employers should be aware of the statutory protections and opportunities existing for veterans, including USERRA and the existing Minnesota Veteran’s Preference statute.  Private employers considering granting a preference to veterans in line with the new law, Minn. Stat. §197.4551, should make sure that the grant is also in compliance with any other obligations they may have, including obligations under collective bargaining agreements and federal law.