High Court Expands Availability of Differential Pay to Military Reservists

The U.S. Supreme Court on April 30 clarified that differential pay is available to military reservists serving during a national emergency without them having to make the extra showing that their service has a substantive connection to a particular national emergency.  

Differential pay — also commonly called “top-up pay” — is the difference between a service member’s civilian pay and their military pay, said Mark Girouard, an attorney with Nilan Johnson Lewis in Minneapolis, leading up to the court’s 5-4 decision. Civilian pay is usually higher than military pay.

Because some national emergencies have been in effect for years, such as the annually renewed emergency in response to the Sept. 11, 2001, terrorist attacks, the court’s ruling greatly expands which reservists are eligible for differential pay during “contingency operations.”  

Justice Clarence Thomas — writing for the dissent — said, “It strains credulity to think that Congress could have meant ‘contingency operation’ to mean, as a practical matter, essentially every military operation.”  

But the majority opinion, written by Justice Neil Gorsuch, said that a plain reading of statutory language dictated a ruling in the favor of the plaintiff. A ruling against the plaintiff would have left unanswered the question of whether the law fairly informs a private employer what is and is not prohibited when it opts to provide differential pay.

Defining ‘Contingency Operation’

The plaintiff, Nick Feliciano, was a reservist who argued that he was entitled to differential pay because he served in a contingency operation. A contingency operation is defined by Section 101(a)(13)(B) of Title 10 of the U.S. Code as “a military operation that … results in the call or order to … active duty of members of the uniformed services under Section 688, 12301(a), 12302, 12304, 12304a, 12305, or 12406 of [title 10], chapter 13 of [title 10], Section 3713 of title 14, or any other provision of law during a war or during a national emergency declared by the president or Congress” (emphasis added by the Supreme Court).

Feliciano acknowledged that he was not called up under any of the specific statutes listed in Section 101(a)(13)(B), but he maintained that the statute’s closing words, italicized above, entitled him to differential pay when he served for the U.S. Coast Guard. Feliciano, an air traffic controller for the Federal Aviation Administration, was a reservist ordered to active-duty service in July 2012. He remained on active duty until February 2017.

However, Feliciano was denied differential pay. The Merit Systems Protection Board upheld this denial, as did the U.S. Court of Appeals for the Federal Circuit.

Supreme Court’s Decision

The Supreme Court reversed the denial.

“At its core, the dispute before us turns on the meaning of the phrase ‘during a national emergency,’ ” the Supreme Court stated. Does that language promise differential pay to certain federal civilian employees on active-duty service while a national emergency is ongoing, as Feliciano argues? Or does it require a reservist to prove some additional, substantive connection between his service and a particular national emergency, as the Federal Circuit ruled and the government contends?

“Several considerations persuade us that Mr. Feliciano’s interpretation is the sounder one,” the Supreme Court said.

The court based its decision first on its interpretation of the word “during,” saying that means “contemporaneous with.”

“Just ask yourself how an ordinary American might approach the law’s terms,” the Supreme Court stated. “Would he have any reason to think that a reservist called up to active duty ‘during’ a national emergency is entitled to differential pay if, and only if, he can prove his service has a ‘substantive connection’ to a particular emergency? We doubt it.”

Moreover, the court noted, 18 U.S.C. Section 209 makes it a crime for a private party to supplement a federal employee’s salary. One exception allows a private party to offer differential pay to a reservist employee on active duty for a call referred to in 10 U.S.C. Section 101(a)(13).  

Under the government’s interpretation of 10 U.S.C. Section 101(a)(13), “a private employer would apparently commit a federal crime by providing differential pay to a reservist on active-duty service while a national emergency is ongoing — unless, of course, the reservist’s service bears a substantive connection to a particular national emergency,” the Supreme Court noted. “But what in the phrase ‘during a national emergency’ tells a private employer that a substantive connection is required, let alone what sort of connection it must be?”

Response to the Government’s and Dissent’s Concerns

The federal government, the defendant in the case, and the dissent suggested that a ruling for the plaintiff would invite anomalous policy consequences. For example, a reservist called to active duty to face a court martial might be entitled to differential pay. So, too, might a reservist called for training for new judge advocates.

But the Supreme Court said these results would not be that anomalous. 

“Members of the Armed Forces facing court martial are entitled to their military wages until convicted,” it said. “Much the same goes for reservists called to active duty for training. Whether that training entails learning the finer points of the Uniform Code of Military Justice or attending Airborne School, well-trained reservists are ones the nation can call on at a moment’s notice, as it often has.”

This case is Feliciano v. Department of Transportation.