Posts Tagged ‘RRB’

RRB: Unemployment and sickness benefits for railroad employees

The Railroad Retirement Board (RRB) administers the Railroad Unemployment Insurance Act (RUIA), which provides two kinds of benefits for qualified railroaders: unemployment benefits for those who become unemployed but are ready, willing and able to work; and sickness benefits for those who are unable to work because of sickness or injury. Sickness benefits are also payable to female rail workers for periods of time when they are unable to work because of health conditions related to pregnancy, miscarriage or childbirth. A new benefit year begins each July 1.

The following questions and answers describe these benefits, their eligibility requirements and how to claim them. At the time this news release was issued, unemployment and sickness benefit flexibilities were in place due to the COVID-19 pandemic. Because these flexibilities are temporary and may change, they are not covered in this release. Visit RRB.gov/coronavirus for up-to-date information.

1. What are the eligibility requirements for railroad unemployment and sickness benefits in July 2021?

To qualify for normal railroad unemployment or sickness benefits, an employee must have had railroad earnings of at least $4,137.50 in calendar year 2020, counting no more than $1,655 for any one month. Those who were first employed in the rail industry in 2020 must also have at least five months of creditable railroad service in 2020.

Under certain conditions, employees who do not qualify on the basis of their 2020 earnings may still be able to receive benefits in the new benefit year. Employees with at least 10 years of service (120 or more months of service) who received normal benefits in the benefit year ending June 30, 2021, may be eligible for extended benefits. Employees with at least 10 years of service (120 or more months of service) might qualify for accelerated benefits if they have railroad earnings of at least $4,275 in 2021, not counting earnings of more than $1,710 in any one month.

In order to qualify for extended unemployment benefits, a claimant must not have voluntarily quit work without good cause and not have voluntarily retired. To qualify for extended sickness benefits, a claimant must not have voluntarily retired and must be under age 65.

To be eligible for accelerated benefits, a claimant must have 14 or more consecutive days of unemployment or sickness; not have voluntarily retired or, if claiming unemployment benefits, quit work without good cause; and, when claiming sickness benefits, be under age 65.

2. What is the daily benefit rate payable in the new benefit year beginning July 1, 2021?

Almost all employees will qualify for the maximum daily benefit rate of $82. Benefits are generally payable for the number of days of unemployment or sickness over four in 14-day claim periods, which yields $820 for each two full weeks of unemployment or sickness. Sickness benefits payable for the first 6 months after the month the employee last worked are subject to Tier I Railroad Retirement payroll taxes, unless benefits are being paid for an on-the-job injury.

Claimants should be aware that as a result of a sequestration order under the Budget Control Act of 2011, the RRB will reduce unemployment and sickness benefits by 5.7% through September 30, 2021. Consequently, the total maximum amount payable in a 2-week period covering 10 days of unemployment or sickness will be $773.26. The maximum amount payable for sickness benefits subject to Tier I payroll taxes of 7.65% will be $714.11 over two weeks. Future reductions, should they occur, will be calculated based on applicable law.

(The temporary benefits created under the Coronavirus Aid, Relief, and Economic Security Act, Continued Assistance to Rail Workers Act of 2020 (CARWA), and American Rescue Plan Act of 2021 are not subject to sequestration. Under CARWA, beginning January 3, 2021, all benefits under the RUIA (including normal unemployment and sickness benefits as well as normal extended unemployment and sickness benefits) will be exempt from sequestration until 30 days after the Presidential declaration of a national emergency concerning COVID-19 terminates. The RRB will publish updated information regarding the status of the sequestration of RUIA benefits when the end date of the Presidential declaration of a national emergency is known.)

3. How long are these benefits payable?

Normal unemployment or sickness benefits are each payable for up to 130 days (26 weeks) in a benefit year. The total amount of each kind of benefit which may be paid in the new benefit year cannot exceed the employee’s railroad earnings in calendar year 2020, counting earnings up to $2,138 per month.

If normal benefits are exhausted, extended benefits are payable for up to 65 days (during seven consecutive 14-day claim periods) to employees with at least 10 years of service (120 or more cumulative service months).

4. What is the waiting period requirement for unemployment and sickness benefits?

There is a seven-day waiting period requirement, prior to any benefits becoming payable under the RUIA. During the first 14-day claim period, benefits are payable for every day claimed in excess of seven days. Subsequent claims are paid for the number of days of unemployment or sickness over four in each 14-day registration period. Initial sickness claims must also begin with four consecutive days of sickness. If an employee has at least five days of unemployment or five days of sickness in a 14-day period, he or she should still file for benefits in order to satisfy the waiting period for the current benefit year. Separate waiting periods are required for unemployment and sickness benefits. However, only one seven-day waiting period is generally required during any period of continuing unemployment or sickness, even if that period continues into a subsequent benefit year.

5. Are there special waiting period requirements if unemployment is due to a strike?

If a worker is unemployed because of a strike conducted in accordance with the Railway Labor Act, benefits are not payable for days of unemployment during the first 14 days of the strike, but benefits are payable during subsequent 14-day periods.

If a strike is in violation of the Railway Labor Act, unemployment benefits are not payable to employees participating in the strike. However, employees not among those participating in such an illegal strike, but who are unemployed on account of the strike, may receive benefits after the first two weeks of the strike.

While a benefit year waiting period cannot count toward a strike waiting period, the 14-day strike waiting period may count as the benefit year waiting period if a worker subsequently becomes unemployed for reasons other than a strike later in the benefit year.

6. Can employees in train and engine service receive unemployment benefits for days when they are standing by or laying over between scheduled runs?

No, not if they are standing by or laying over between regularly assigned trips or they missed a turn in pool service.

7. Can extra-board employees receive unemployment benefits between jobs?

Yes, but only if the miles and/or hours they actually worked were less than the equivalent of normal full-time work in their class of service during the 14-day claim period. Entitlement to benefits would also depend on the employee’s earnings.

8. How would an employee’s earnings in a claim period affect his or her eligibility for unemployment benefits?

If a claimant’s earnings for days worked, and/or days of vacation, paid leave or other leave in a 14-day registration period are more than a certain indexed amount, no benefits are payable for any days of unemployment in that period. That registration period, however, can be used to satisfy the waiting period.

Earnings include pay from railroad and non-railroad work, as well as part-time work and self-employment. Earnings also include pay that an employee would have earned except for failure to mark up or report for duty on time, or because he or she missed a turn in pool service or was otherwise not ready or willing to work. For the benefit year that begins July 2021, earnings of $1,655 or more in a claim period will disqualify a claim for unemployment benefits, even if there are more than 4 days of unemployment claimed. This amount corresponds to the base year monthly compensation amount used in determining eligibility for benefits in each year. Also, even if an earnings test applies on the first claim in a benefit year, this will not prevent the first claim from satisfying the waiting period in a benefit year.

Earnings of $15 or less per day from work which is substantially less than full-time and not inconsistent with the holding of normal full-time employment may be considered subsidiary remuneration and may not prevent payment of any days in a claim. However, a claimant must report all full and part-time work on each claim, regardless of the amount of earnings, so the RRB can determine if the work affects benefits.

9. How does a person apply for and claim unemployment benefits?

Employees can apply for and claim unemployment benefits online or by mail. Individuals who have established an account through myRRB at RRB.gov can log in and file their applications and their biweekly claims online. Employees who need to create an account should visit RRB.gov/myRRB and click on the button labeled Sign in with login.gov. Employees are encouraged to establish their accounts while still working to expedite the filing process for future unemployment benefits, and for access to other online services.

To apply by mail, claimants must obtain an Application for Unemployment Benefits (Form UI-1) from RRB.gov, their labor organization or railroad employer. The completed application should be mailed to the local RRB office as soon as possible and must be filed within 30 days from the date the claimant became unemployed, or the first day for which he or she wishes to claim benefits. Benefits may be lost if the application is filed late. Claimants filing a late unemployment application or claim should include a signed statement explaining why they are unable to meet the required time frame.

Persons can find the address of the RRB office serving his or her area by visiting RRB.gov and clicking on Field Office Locator, or by calling the agency toll-free at 1-877-772-5772 and selecting the appropriate option from the automated menu.

The local RRB field office reviews the completed application, whether it was submitted online or by mail, and notifies the claimant’s current railroad employer, and base-year employer, if different. The employer has the right to provide information about the benefit application.

After processing the application, biweekly claim forms are provided to the claimant for as long as he or she remains unemployed and eligible for benefits. If a claimant filed an online application, his or her claim forms are only made available online. If a claimant filed a paper application, his or her first claim form is both available online and mailed to him or her. If the claimant returns the paper claim, future claims will be mailed to him or her. If the claimant files the claim online, all subsequent claim forms will only be made available online, and will no longer be mailed. Claimants must not file both an online and a paper claim form for the same period(s). Claim forms should be signed and sent (online or by mail) on or after the last day of the claim. The completed claim must be received by the RRB within 15 days of the end of the claim period, or within 15 days of the date the claim form was made available online or mailed to the claimant, whichever is later.

Only one application needs to be filed during a benefit year, even if a claimant becomes unemployed more than once. However, in the case of multiple claim periods, a claimant must request a claim form from the RRB within 30 days of the first day for which he or she wants to resume claiming benefits. These claim forms may then be filed online or by mail.

10.  How does a person apply for and claim sickness benefits?

An Application for Sickness Benefits (Form SI-1a) can be obtained from RRB.gov, a railroad labor organization, or a railroad employer. Applications for sickness benefits must be submitted to the agency by mail. However, subsequent claims may be mailed, or completed online by employees who have established a myRRB account at RRB.gov.

An application including a doctor’s Statement of Sickness (Form SI-1b – included with form SI-1a) is required at the beginning of each period of continuing sickness for which benefits are claimed. Claimants should make a special effort to have the doctor’s statement of sickness completed promptly since claims cannot be paid without it.

The RRB suggests that employees keep an application for sickness benefits on hand, and that family members know where the form is kept and how to use it. If an employee becomes unable to work because of sickness or injury, the employee should complete the application and have his or her doctor complete the attached statement of sickness. If a claimant receives sickness benefits for an injury or illness for which he or she is paid damages, it is important to be aware that the RRB is entitled to reimbursement of either the amount of the benefits paid for the injury or illness or the net amount of the settlement, after deducting the claimant’s gross medical, hospital and legal expenses, whichever is less.

If the employee is too sick to complete the application, someone else may complete it for him or her. In such cases, a family member should also complete a Statement of Authority to Act for Employee (Form SI-10 included with form SI-1a), which accompanies the statement of sickness.

After completion, the forms should be mailed to the RRB’s headquarters in Chicago within 10 days from when the employee became sick or injured. However, applications received after 10 days but within 30 days of the first day for which an employee wishes to claim benefits are generally considered timely filed if there is a good reason for the delay. (Employees cannot currently file their sickness applications online.) Upon receipt, the RRB will process the application and determine if the employee is eligible for sickness benefits.

After processing the application and statement of sickness, the RRB makes the first biweekly claim form available online (for employees with myRRB accounts) and mails a paper form to the employee as long as he or she is eligible for benefits and remains unable to work due to illness or injury. Those choosing to file the paper claim received by mail should return the completed form to RRB headquarters for processing. If the claimant returns the paper claim, future claims will be mailed to him or her. If the claimant files the claim online, all subsequent claim forms will only be made available online, and will no longer be mailed. Claimants must not file both online and paper claim forms for the same claim period(s). Employees who need to create a myRRB account should visit RRB.gov/myRRB and click on the button labeled Sign in with login.gov.

Completed claim forms must be received at the RRB within 30 days of the last day of the claim period, or within 30 days of the date the claim form was made available online or mailed to the claimant, whichever is later. Benefits may be lost if an application or claim form is filed late. Claimants filing a late sickness application or claim form should include a signed statement explaining why they were unable to meet the required time frame.

Claimants are reminded that while claim forms for sickness benefits can be submitted online, applications for sickness benefits must be mailed to the RRB. Statements of sickness may be mailed with the sickness application or faxed directly from the doctor’s office to the RRB at 312-751-7185. Faxes must include a cover sheet from the doctor’s office. Also, in order to prevent a delay in processing applications or claims, employees are advised against sending any sickness benefit forms to the RRB in Chicago via certified mail.

11. Is a claimant’s employer notified each time a biweekly claim for unemployment or sickness benefits is filed?

The RUIA requires the RRB to notify the claimant’s base-year employer each time a claim for benefits is filed. That employer has the right to submit information relevant to the claim before the RRB makes an initial determination on the claim. Benefits may not be paid at this time but the employee will receive a notice and have the right to appeal. In addition, if a claimant’s base-year employer is not his or her current employer, the claimant’s current employer is also notified. The RRB must also notify the claimant’s base-year employer each time benefits are paid to a claimant. The base-year employer may protest the decision to pay benefits. Such a protest does not prevent the timely payment of benefits. However, a claimant may be required to repay benefits if the employer’s protest is ultimately successful. The employer also has the right to appeal an unfavorable decision to the RRB’s Bureau of Hearings and Appeals.

The RRB also conducts checks with other Ffederal agencies and all 50 states, as well as the District of Columbia and Puerto Rico, to detect fraudulent benefit claims, and it checks with physicians to verify the accuracy of medical statements supporting sickness benefit claims.

12. How long does it take to receive payment?

Under the RRB’s Customer Service Plan, if a claimant files an application for unemployment or sickness benefits, the RRB will release a claim form or a denial letter within 10 days of receiving his or her application. If a claim for subsequent biweekly unemployment or sickness benefits is filed, the RRB will certify a payment or release a denial letter within 10 days of the date the RRB receives the claim form. If the claimant is entitled to benefits, his or her benefits will generally be paid within one week of that decision.

If a claimant does not receive a decision notice or payment within the specified time period, he or she may expect an explanation for the delay and an estimate of the time required to make a decision.

However, some claims for benefits may take longer to handle than others, especially if they are more complex, or if an RRB office has to get information from other people or organizations, or under special circumstances such as the current pandemic.

Claimants who think an RRB office made the wrong decision about their benefits have the right to ask for review and to appeal. They will be notified of these rights each time an unfavorable decision is made on their claims.

13. How are payments made?

Railroad unemployment and sickness insurance benefits are paid by direct deposit to an employee’s bank, savings and loan, credit union or other financial institution. New applicants for unemployment and sickness benefits will be asked to provide information needed for direct deposit enrollment.

14. How can claimants get more information on their railroad unemployment or sickness claims?

Claimants with myRRB accounts can view their individual railroad unemployment and sickness insurance account statement by using the View RUIA Account service. This statement displays the type and amount of the claimant’s last five benefit payments, the claim period for which the payments were made, and the dates that the payments were approved. Individuals can also confirm the RRB’s receipt of applications and claims.

In addition, claimants can call the agency toll-free at 1-877-772-5772 to access information about the status of unemployment and sickness claims or payments 24 hours a day, 7 days a week. Individuals with questions about unemployment or sickness benefits, or who need information about their specific claims and benefit payments, can send a secure e-mail to their local office by accessing the Field Office Locator at RRB.gov and clicking on the link at the bottom of their local office’s page. If a customer needs to talk to an RRB employee, they can call the agency’s toll-free number (1-877-772-5772). However, customers are asked to be patient because of the increase in call volume due to the closure to the public of RRB offices during the COVID-19 pandemic.

RRB reminds that 2020 service statements will be released in June

Notice from John Bragg, the RRB labor member

Brothers and Sisters,

RRB Labor Member
John Bragg

It is hard to believe that 2020 is in the rearview mirror and we are already approaching the mid-point of 2021. The Railroad Retirement Board (RRB) is still operating in a remote capacity with field offices closed to the public. Hopefully, in the not too distant future, I will be writing to advise you of plans for getting back to normal operations. Today, however, I am writing to share a friendly reminder with you about action which every active employee should take on an annual basis – and may be of particular importance this year to some, in light of the unique work circumstances many encountered.

Each year, on or before the last day of February, employers must report service and compensation for each employee who performed compensated service in the preceding calendar year. The RRB, in turn, credits the service and compensation records of individual employees based upon these reports and in June of every year, the RRB releases Form BA-6 to each employee for which compensated service for the preceding year was reported. The Form BA-6 contains the information recently reported for the preceding year, as well as the information reported for three preceding years. For example, the Forms BA-6 which will be released by the RRB in mid-June of 2021 will contain service and compensation reported for the years 2017 through 2020. Regardless of the amount earned, the amount of compensation shown on the Form BA-6 will always be limited by the maximum creditable Tier I compensation amount for the calendar year. For calendar years 2017 through 2020, the maximum amounts creditable are $127,200, $128,400, $132,900 and $137,700, respectively. In addition to showing the creditable compensation for the years 2017 through 2020, the Form BA-6 issued in mid-June of 2021 will show the months for which the employer reported railroad service for the employee during the years 2017-2020.

It is critical that individual employees review their annual Forms BA-6 to make sure that all the information contained on the form is accurate. For example, in addition to validating the creditable compensation, it is important to check to see if the employer properly reported the months for which credit was given by the employer for a month of railroad service. Every month for which you believe you should have credit for railroad service should be coded with a “1”. If the code is “0”, you will not receive credit for any railroad service for that month. If the code is “D” then you will receive credit for railroad service pursuant to the rules governing the deeming of service months.

Employees who received pay for time lost, especially as a result of arbitration proceedings, during the years 2017 through 2020 are reminded of the importance of checking their Forms BA-6. RRB regulations at 20 C.F.R. § 209.15(b) provide that compensation which is pay for time lost must be reported with respect to the year in which the time and compensation were lost. However, it is not uncommon for the individuals responsible for completing reports of service and compensation to be unfamiliar with how to report pay for time lost, or to lack awareness that the compensation they are reporting reflects pay for time lost. As a result, the compensation is mistakenly reported for the year paid AND the service months for which the time and compensation were lost are not credited as railroad service months. Situations where this is most likely to occur are arbitration decisions resulting in the employee being reinstated with all rights and benefits unimpaired and receiving compensation for lost time.

REMEMBER: The law limits the period during which corrections to service and compensation records may be filed to four years from the date the report was due at the RRB, so it is very important for employees to request a correction within that period of time. Any railroad employee who thinks that the Form BA-6 contains an error should be certain to follow the directions on how to file with the RRB a protest of the information contained on the Form BA-6.

 

 

RRB: Dual benefit payments Q&A

The payment of a Railroad Retirement annuity can be affected by entitlement to Social Security benefits, as well as certain other government benefits. Such dual entitlement, if not reported to the Railroad Retirement Board (RRB), can result in benefit overpayments that have to be repaid, sometimes with interest and penalties. The following questions and answers describe how the RRB adjusts Railroad Retirement benefits for annuitants who are also eligible for Social Security benefits and/or other benefit payments.

1. How are dual benefits paid to persons entitled to both Railroad Retirement and Social Security benefits?

If a Railroad Retirement annuitant is also awarded a Social Security benefit, the Social Security Administration determines the amount of the Social Security benefit due, but a combined monthly dual benefit payment should, in most cases, be issued by the RRB after the Railroad Retirement annuity has been reduced by the amount of the Social Security benefit.

2. Why is a Railroad Retirement annuity reduced when a Social Security benefit is also payable?

The Tier I portion of a Railroad Retirement annuity is based on both the Railroad Retirement and Social Security earnings credits acquired by an employee and computed under Social Security formulas. It approximates what Social Security would pay if railroad work were covered by Social Security. Tier I benefits are, therefore, reduced by the amount of any actual Social Security benefit paid on the basis of nonrailroad employment, in order to prevent a duplication of benefits based on Social Security-covered earnings.

In addition, following principles of Social Security law which limit payment to the higher of any two or more benefits payable to an individual at one time, the Tier I dual benefit reduction applies to an annuity even if the Social Security benefit is based on the earnings record of someone other than the railroad employee, such as a spouse or former spouse. An annuitant is required to advise the RRB if any benefits are received directly from the Social Security Administration or if those benefits increase (other than for a cost-of-living increase) to avoid a Railroad Retirement benefit overpayment.

The Tier II portion of a Railroad Retirement annuity is based on the railroad employee’s railroad service and earnings alone and is computed under a separate formula. It is not reduced for entitlement to a Social Security benefit.

3. Are there any exceptions to the Railroad Retirement annuity reduction for Social Security benefits?

No. There are no exceptions to the Railroad Retirement annuity reduction for Social Security benefits.

4. Can federal, state or local government pensions also result in dual benefit reductions in an employee’s Railroad Retirement annuity?

Yes. Tier I benefits for employees first eligible for a Railroad Retirement annuity and a federal, state or local government pension after 1985 may be reduced for receipt of a public pension based, in part or in whole, on employment not covered by Social Security or Railroad Retirement after 1956. This may also apply to certain other payments not covered by Railroad Retirement or Social Security, such as payments from a non-profit organization or a foreign government or a foreign employer. Usually, an employee’s Tier I benefit will not be reduced by more than 1/2 of his or her pension from noncovered employment. However, if the employee is under age 65 and receiving a disability annuity, the Tier I benefit may be reduced by an added amount if the pension from noncovered employment is a public disability benefit.

Military service pensions, payments by the Department of Veterans Affairs, or certain benefits payable by a foreign government as a result of a totalization agreement between that government and the United States will not cause a reduction.

5. Can the public service pension reduction apply to spouse or widow(er)s’ benefits?

Yes. The Tier I portion of a spouse’s or widow(er)’s annuity may be reduced for receipt of any federal, state or local government pension separately payable to the spouse or widow(er) based on her or his own earnings. For spouses and widow(er)s subject to a public service pension reduction, the Tier I reduction is equal to 2/3 of the amount of the public service pension.

The reduction generally does not apply if the employment on which the public service pension is based was covered under the Social Security Act throughout the last 60 months of public employment. Most military service pensions and payments from the Department of Veterans Affairs will not cause a reduction. Pensions paid by a foreign government or interstate instrumentality will also not cause a reduction.

6. What dual benefit restrictions apply when both persons in a marriage are railroad employees entitled to Railroad Retirement annuities?

If both parties started railroad employment after 1974, the amount of any spouse or divorced spouse annuity is reduced by the amount of the employee annuity to which the spouse or divorced spouse is also entitled.

If either party had some railroad service before 1975, the spouse or divorced spouse Tier I amount is reduced by the amount of the railroad employee Tier I to which the spouse or divorced spouse is entitled. The spouse or divorced spouse Tier I amount cannot be reduced below zero. The initial reduction is restored in the spouse Tier II amount. Divorced spouses are not entitled to a Tier II component and are not eligible to have the reduction restored.

In survivor cases, if the widow(er) is entitled to a Railroad Retirement employee annuity and neither the widow(er) nor the deceased employee had any railroad service before 1975, the survivor annuity (Tier I and Tier II) payable to the widow(er) is reduced by the total amount of the widow(er)’s own employee annuity.

If a widow or dependent widower is also a railroad employee annuitant, and either the widow(er) or the deceased employee had 120 months of railroad service before 1975, the Tier I reduction may be partially restored in the survivor Tier II amount.

If either the deceased employee or the widow(er) had some railroad service before 1975 but less than 120 months of service, the widow(er)’s own employee annuity and the Tier II portion of the survivor annuity would be payable to the widow(er). The Tier I portion of the survivor annuity would be payable only to the extent that it exceeds the Tier I portion of the widow(er)’s own employee annuity.

7. Can workers’ compensation or public disability benefits affect Railroad Retirement benefits?

If an employee is receiving a Railroad Retirement disability annuity, Tier I benefits for the employee and spouse may, under certain circumstances, be reduced for receipt of workers’ compensation or public disability benefits.

8. How can an annuitant find out if the receipt of any dual benefits affects his or her Railroad Retirement annuity?

If an annuitant becomes entitled to any of the dual benefit payments discussed above, or if there is any question as to whether a dual benefit payment requires a reduction in an annuity, he or she should contact an RRB field office online or by phone. As all of the RRB’s 53 field offices are physically closed to the public until further notice because of the COVID-19 pandemic, customers are encouraged to contact their local office by accessing Field Office Locator at RRB.gov and clicking on Send a Secure Message at the bottom of their local office’s page. Customers who prefer talking to an RRB employee can call the agency’s toll-free number (1-877-772-5772); however, they may experience lengthy wait times due to increased call volume caused by COVID-19-related issues.

Notice from Labor Member of the RRB: Update on American Rescue Plan Act of 2021

John Bragg, Labor Member of the RRB

Brothers and Sisters,

As you may have heard, Congress recently enacted legislation to provide some financial relief to railroaders. In the legislation entitled the American Rescue Plan Act of 2021 (ARPA), Congress essentially extended the benefits originally created by the CARES Act. This legislation provides for the following benefits:

  • A recovery benefit of $600 per two-week unemployment registration period. This extends the benefit that was established through legislation at the end of December and was due to expire March 14, 2021.  As a result, employees receiving unemployment benefits will continue to receive an additional $600 per registration period. This benefit ends with registration periods that begin after September 6, 2021.
  • Extended unemployment benefits for employees who have otherwise exhausted benefits. Now, in combination with previous legislation, an additional 200 days within 20 additional consecutive two-week registration periods are payable. These extended benefits are available for days of unemployment on or after December 28, 2020. No additional days are available for registration periods beginning after September 6, 2021.
  • Waiver of the seven-day waiting period for unemployment and sickness benefits. This was also extended to September 6, 2021.

In addition, ARPA provides that up to $10,200 in unemployment benefits may be exempt from income tax. This provision is administered by the IRS and they have more information here: New exclusion of up to $10,200 for unemployment benefits.

Finally, as you know, the Railroad Retirement Board’s (RRB)’s budget has remained flat for several years now and as a result, agency resources have been limited. ARPA provided a much-needed supplemental appropriation for the agency’s administrative budget. ARPA appropriated the remaining amount needed for the RRB’s multi-year IT modernization plan which will eventually provide more online services to railroaders and their families. In addition, it appropriated $6.8M for agency hiring related to the pandemic for the next two years. The RRB intends to hire staff in field service as well as in the unit at headquarters that handles sickness and unemployment applications. We hope that these additional hires will improve customer service.

As with previous legislation, the RRB has updated the information on its website with the details regarding these benefits. You can find the FAQs here: Coronavirus FAQs. Also, with most RRB field offices still closed to the public because of the pandemic, the agency is again reminding customers of the self-service options available to them to help avoid lengthy wait times. I encourage all railroaders to set up a myRRB.gov account on the RRB.gov website to help avoid any possible delays. To establish an account, employees should go to RRB.gov/myRRB and click on the button labeled SIGN IN WITH LOGIN.GOV at the top of the page. This directs them to login.gov where they will be guided through the process of creating an account and verifying their identity — which takes about 20 minutes to complete. Once an employee’s identity is verified, they will be prompted to sign in to their account and then return to myRRB.

RRB reports performance under customer service plan

The Railroad Retirement Board’s Customer Service Plan promotes the following principles of quality public service: openness, accessibility, accountability, feedback and timeliness standards. An important part of the Customer Service Plan is its pledge to inform beneficiaries about how well the RRB meets those timeliness standards, which detail the number of calendar days within which the agency must decide to pay or deny an application for benefits.

The following questions and answers provide information about the RRB’s performance in meeting its standards in the key areas of retirement applications, survivor applications, disability applications and payments, and railroad unemployment and sickness benefit applications and claims during fiscal year 2020 (October 1, 2019 – September 30, 2020). Information on the agency’s overall performance, as measured by the timeliness index developed by the agency, and the RRB’s customer service timeliness goals for fiscal year 2020 are also provided. These goals may be revised annually based on such factors as projected workloads and available resources.

1. How does the RRB measure overall timeliness for customer service?

The RRB developed an index to measure the overall timeliness of its customer service in the following benefit areas: retirement applications, survivor applications, disability applications and payments, and railroad unemployment and sickness benefit applications and claims. This composite indicator, based on a weighted average, allows for a more concise and meaningful presentation of the RRB’s customer service efforts in these benefit areas.

2. What was the overall timeliness of the RRB’s customer service in fiscal year 2020?

During fiscal year 2020, the overall benefit timeliness index was 99%. This means that the RRB provided benefit services within the Customer Service Plan’s standards 99% of the time. The timeliness index for retirement applications, survivor applications, and disability applications and payments, the processing of which includes considerable manual intervention, was 90.9%. The timeliness index for railroad unemployment and sickness benefit applications and claims, a highly automated process, was 99.7%.

3. What standards did the RRB use in fiscal year 2020 for processing applications for Railroad Retirement annuities, and how well did it meet those standards?

In fiscal year 2020, the RRB had two timeliness standards for processing Railroad Retirement annuities. For Railroad Retirement annuity applications filed in advance of an applicant’s eligibility date, the RRB’s standard was that it would make a decision to pay or deny the application within 35 days of the requested annuity beginning date. For applications filed after the eligibility date, the RRB’s standard was that it would make a decision within 60 days of the filing date. The RRB’s timeliness goals in fiscal year 2020 were 94% for both advance filing and non-advance filing applications.

Of the cases processed during fiscal year 2020, the RRB made a decision within 35 days of the annuity beginning dates on 96.4% of applicants who filed in advance, with an average processing time for these cases of 13.4 days. Of the cases processed during fiscal year 2020, the RRB made a decision within 60 days of the filing dates on 97.5% of applicants who had not filed in advance, with an average processing time of 17 days.

4. What standards did the RRB use for processing applications for survivor benefits in fiscal year 2020, and how well did it meet those standards?

The timeliness standard in fiscal year 2020 within which the RRB would make a decision to pay, deny or transfer the application to the Social Security Administration for a Railroad Retirement survivor annuity applicant not already receiving benefits as a spouse, was within 60 days of the applicant’s annuity beginning date, or the date the application was filed, whichever was later. For an applicant that was already receiving a spouse annuity, the RRB’s standard in fiscal year 2020 was within 30 days of the first notice of the employee’s death. For an applicant who filed for a lump-sum death benefit, the RRB’s standard in fiscal year 2020 was to make a decision to pay or deny the application within 60 days of the date the application was filed. The timeliness goal for fiscal year 2020 was 94% for processing both initial survivor applications and spouse-to-survivor conversions. For processing applications for lump-sum death benefits, the goal was 97%.

Of the cases processed during fiscal year 2020, the RRB made a decision within 60 days of the later of the annuity beginning date or the date the application was filed in 95% of the applications for an initial survivor annuity. In cases where the survivor was already receiving a spouse annuity, a decision was made within 30 days of the first notice of the employee’s death in 95.2% of the cases. In addition, a decision was made within 60 days of the date the application was filed in 97.3% of the applications for a lump-sum death benefit. The combined average processing time for all initial survivor applications and spouse-to-survivor conversions was 15.95 days. The average processing time for lump-sum death benefit applications was 11.1 days.

5. What standards did the RRB use for processing applications for disability annuities in fiscal year 2020, and how well did it meet those standards?

For applications filed for a disability annuity in fiscal year 2020, the RRB’s standard was to make a decision to pay or deny a benefit within 100 days of the date the application was filed. If it was determined that the applicant was entitled to disability benefits, the applicant would receive his or her first payment within 25 days of the date of the RRB’s decision, or the earliest payment date, whichever was later. The agency’s timeliness goals were 70% and 94%, respectively, for disability decisions and disability payments.

During fiscal year 2020, the RRB made a decision on 13.5% of those filing for a disability annuity within 100 days of the date the application was filed. The average processing time was 330.8 days. Of those whose applications for a disability annuity were approved, 88.5% received their first payment within the Customer Service Plan’s time standard. The average processing time was 15.3 days.

6. What were the standards in fiscal year 2020 for the handling of applications and claims for railroad unemployment and sickness benefits, and how well did the RRB meet these standards?

For fiscal year 2020, the RRB’s standard for processing an application for unemployment or sickness benefits was that the RRB would release a claim form or a denial letter within 10 days of receiving an application. If an applicant filed a claim for subsequent biweekly unemployment or sickness benefits, the RRB’s standard was to certify a payment or release a denial letter within 10 days of the date the RRB received the claim form. The agency’s goals for processing unemployment and sickness applications in fiscal year 2020 were, respectively, 99.5% and 99.3%. The payment or decision goal for subsequent claims was 98.5%.

During fiscal year 2020, 99.3% of unemployment benefit applications and 97.4% of sickness benefit applications processed met the RRB’s standard. Average processing times for unemployment and sickness benefit applications were 1.2 and 3.1 days, respectively. In addition, in fiscal year 2020, 99.9% of subsequent claims processed for unemployment and sickness benefits met the RRB’s standard. The average processing time for claims was 4.5 days.

7. How well did the RRB meet its standards in fiscal year 2020 compared to fiscal year 2019?

Fiscal year 2020 performance met or exceeded fiscal year 2019 performance in the areas of retirement benefits, whether filed in advance or not, disability decisions and payments, lump-sum death benefits, and unemployment and sickness benefit claims.

Average processing times in fiscal year 2020 equaled or improved fiscal year 2019 processing times in the areas of Railroad Retirement applications, whether filed in advance or not, disability decisions and payments, and sickness applications. For fiscal year 2020, the agency met or exceeded all of the customer service performance goals it had set for the year, except in the areas of unemployment and sickness applications and disability decisions and payments.

RRB: The importance of a current connection for Railroad Retirement benefits

Under the Railroad Retirement Act (RRA), a “current connection with the railroad industry” is one of the eligibility requirements for both the occupational disability and supplemental annuities payable by the Railroad Retirement Board (RRB). It is also a factor in determining whether the RRB or the Social Security Administration pays monthly benefits to survivors of a railroad employee.

The following questions and answers describe the current connection requirement and the ways the requirement can be met.

1. How is a current connection determined under the RRA?

To meet the current connection requirement, an employee must generally have been credited with railroad service in at least 12 months of the 30 months immediately preceding the month his or her Railroad Retirement annuity begins. If the employee died before retirement, railroad service in at least 12 months in the 30 months before the month of death will meet the current connection requirement for the purpose of paying survivor benefits.

However, if an employee does not qualify on this basis, but has 12 months of railroad service in an earlier 30-month period, he or she may still meet the current connection requirement. This alternative generally applies if the employee did not have any regular employment outside the railroad industry after the end of the last 30-month period which included 12 months of railroad service, and before the month the annuity begins or the month of death if earlier.

Once a current connection is established at the time the Railroad Retirement annuity begins, an employee never loses it, no matter what kind of work is performed thereafter.

2. Can non-railroad work before retirement break a former railroad employee’s current connection?

Yes. Full or part-time work for a non-railroad employer in the interval between the end of the last 30-month period including 12 months of railroad service and the month an employee’s annuity begins, or the month of death if earlier, can break a current connection, even with minimal earnings.

Self-employment in an unincorporated business will not break a current connection. However, if the business is incorporated the individual is considered to be an employee of the corporation, and such self-employment can break a current connection. All self-employment will be reviewed to determine if it meets the RRA’s standards for maintaining a current connection.

Federal employment with the Department of Transportation, National Transportation Safety Board, Surface Transportation Board, National Mediation Board, Railroad Retirement Board or Transportation Security Administration will not break a current connection. State employment with the Alaska Railroad, as long as that railroad remains an entity of the State of Alaska, will not break a current connection. Also, railroad service in Canada for a Canadian railroad will neither break nor preserve a current connection.

3. Is there an exception to these normal procedures for determining a current connection?

Yes. A current connection can also be “deemed” for purposes of a survivor or supplemental annuity if the employee completed 25 years of railroad service, was involuntarily terminated without fault from his or her last job in the railroad industry, and did not thereafter decline an offer of employment in the same class or craft in the railroad industry regardless of the distance to the new position. (A “deemed” current connection does not satisfy the current connection requirement for an occupational disability.)

If all of these requirements are met, an employee may be considered to have a “deemed” current connection, even if the employee works in regular non-railroad employment after the 30-month period and before retirement or death. This exception to the normal current connection requirement was established by amendments to the RRA and became effective October 1, 1981. It only covers employees still living on that date who left the rail industry on or after October 1, 1975, or who were on leave of absence, on furlough or absent due to injury on October 1, 1975.

4. Would accepting a buy-out affect whether an employee could maintain a current connection under this exception?

Generally, in cases where an employee has no option to remain in the service of his or her railroad employer, the termination of the employment is considered involuntary, regardless of whether or not the employee receives a buy-out.

However, if an employee has the choice of either accepting a position in the same class or craft in the railroad industry or termination with a buy-out, accepting the buy-out is a part of his or her voluntary termination, and the employee would not maintain a current connection under the exception.

5. An employee with 25 years of service is offered a buy-out with the option of either taking payment in a lump sum or of receiving monthly payments until retirement age. Could the method of payment affect the employee’s current connection under the exception?

No. The determining factor for whether the exception applies when a buy-out is paid is whether or not the employee stopped working involuntarily – not the payment option. The employee must always relinquish job rights to accept the buy-out, regardless of whether it is paid in a lump sum or in monthly payments. Neither payment option extends the 30-month period.

An employee considering accepting a buy-out should also be aware that if he or she relinquishes job rights to accept the buy-out, the compensation cannot be used to credit additional service months beyond the month in which the employee severed his or her employment relation, regardless of whether payment is made in a lump sum or on a periodic basis.

6. What if the buy-out agreement allows the employee to retain job rights and receive monthly payments until retirement age?

The RRB considers this type of buy-out to be a dismissal allowance. When a monthly dismissal allowance is paid, the employee retains job rights, at least until the end of the period covered by the dismissal allowance. If the period covered by the dismissal allowance continues up to the beginning date of the railroad retirement annuity, railroad service months would be credited to those months. These railroad service months would provide at least 12 railroad service months in the 30 months immediately before the annuity beginning date and maintain a regular current connection. They will also increase the number of railroad service months used to calculate the Railroad Retirement annuity.

7. Could the exception apply in cases where an employee has 25 years of railroad retirement coverage and a company reorganization results in the employee’s job being placed under social security coverage?

Yes. The RRB has considered the exception applicable in cases where a 25-year employee’s last job in the railroad industry changed from Railroad Retirement coverage to Social Security coverage and the employee had, in effect, no choice available to remain in Railroad-Retirement-covered service. Such 25-year employees have been “deemed” to have a current connection for purposes of receiving supplemental and survivor annuities.

8. Where can a person get more specific information on the current connection requirement?

More information is available on RRB.gov or by contacting an RRB field office. It is important to know that while nearly all of the RRB’s 53 field offices are physically closed to the public until further notice because of the COVID-19 virus outbreak, they remain accessible online and by phone. Customers are encouraged to contact their local office by accessing Field Office Locator at RRB.gov and clicking on Send a Secure Message at the bottom of their local office’s page. Customers who prefer talking to an RRB employee can call the agency’s toll-free number (1-877-772-5772); however, they may experience lengthy wait times due to increased call volume caused by COVID-19-related issues.

RRB: Railroad retirement and unemployment insurance taxes in 2021

The amounts of compensation subject to Railroad Retirement Tier I and Tier II payroll taxes will increase in 2021, while the tax rates on employers and employees will stay the same. In addition, unemployment insurance contribution rates paid by railroad employers will include a surcharge of 2.5 percent, partially reflecting increased unemployment claims due to the pandemic.

Tier I and Medicare Tax.–The Railroad Retirement Tier I payroll tax rate on covered rail employers and employees for 2021 remains at 7.65%. The Railroad Retirement Tier I tax rate is the same as the Social Security tax, and for withholding and reporting purposes is divided into 6.20% for retirement and 1.45% for Medicare hospital insurance. The maximum amount of an employee’s earnings subject to the 6.20% rate increases from $137,700 to $142,800 in 2021, with no maximum on earnings subject to the 1.45% Medicare rate.

An additional Medicare payroll tax of 0.9% applies to an individual’s income exceeding $200,000, or $250,000 for a married couple filing a joint tax return. While employers will begin withholding the additional Medicare tax as soon as an individual’s wages exceed the $200,000 threshold, the final amount owed or refunded will be calculated as part of the individual’s Federal income tax return.

Tier II Tax.–The Railroad Retirement Tier II tax rates in 2021 will remain at 4.9% for employees and 13.1% for employers. The maximum amount of earnings subject to Railroad Retirement Tier II taxes in 2021 will increase from $102,300 to $106,200. Tier II tax rates are based on an average account benefits ratio reflecting railroad retirement fund levels. Depending on this ratio, the Tier II tax rate for employees can be between 0% and 4.9%, while the Tier II rate for employers can range between 8.2% and 22.1%.

Unemployment Insurance Contributions.–Employers, but not employees, pay railroad unemployment insurance contributions, which are experience-rated by employer. The Railroad Unemployment Insurance Act also provides for a surcharge in the event the Railroad Unemployment Insurance Account balance falls below an indexed threshold amount. The accrual balance of the Railroad Unemployment Insurance Account was $53.7 million on June 30, 2020. This was below the indexed threshold of $73.7 million, triggering a 2.5% surcharge in 2021. There was no surcharge imposed in 2020, following five consecutive years of a 1.5% surcharge.

As a result, the unemployment insurance contribution rates on railroad employers in 2021 will range from the minimum rate of 3.15% to the maximum of 12 percent on monthly compensation up to $1,710, an increase from $1,655 in 2020.

In 2021, the minimum rate of 3.15% will apply to about 87% of covered employers, with almost 5% paying the maximum rate of 12%. New employers will pay an unemployment insurance contribution rate of 3.15%, which represents the average rate paid by all employers in the period 2017-2019.

Click here to view a pdf of 2021 tax rates.

Releases from RRB: Q&A about the effect of private rail pensions; Medicare Part B premiums for 2021

Private rail pensions may reduce supplemental annuities

Railroad Retirement beneficiaries are reminded that receipt of a private railroad pension may reduce the amount of a supplemental annuity payable by the Railroad Retirement Board (RRB). The following questions and answers provide information on this subject and how 401(k) plans are affected by the Railroad Retirement Act (RRA).

1. What are the eligibility requirements for a supplemental annuity?

Monthly supplemental annuities are payable to employee annuitants with 25 or more years of rail service, a “current connection” with the railroad industry, and at least one month of creditable rail service before October 1981. Individuals with 30 years or more of rail service may begin receiving a supplemental annuity at age 60, whereas individuals with 25-29 years of service may do so at age 65. (Disabled annuitants under full retirement age, which is gradually rising to age 67 for those born in 1960 or later, must relinquish employment rights in order for a supplemental annuity to be paid by the RRB.) Monthly supplemental annuity rates vary based on an annuitant’s years of rail service. The maximum monthly supplemental annuity rate is $43.

2. How does the receipt of a private railroad pension affect payment of a supplemental annuity?

If a retired employee also receives a private pension funded entirely, or in part, by a railroad employer, the supplemental annuity is permanently reduced by the amount of the monthly pension that is based on the railroad employer’s contributions. However, if the employer reduces the pension for the employee’s entitlement to a supplemental annuity, the amount by which the pension is reduced is restored to the supplemental annuity (but does not raise it over the $43 maximum). There is no reduction for a pension paid by a railroad labor organization.

3. What if an employee elects to receive the pension in a lump-sum payment instead of as a monthly benefit?

If a retired employee elects to receive his or her pension in a lump-sum payment instead of as a monthly benefit, the supplemental annuity is reduced in the same way as it would be if the employee was receiving the monthly benefit. (If the lump sum is paid in installments, the installment payments are not considered monthly benefit payments, but part of the single lump-sum payment.)

4. Does the receipt of a 401(k) plan distribution reduce the amount of a supplemental annuity?

No. In Legal Opinion L-2014-2, issued January 13, 2014, the RRB’s general counsel determined that 401(k) plans should not be considered supplemental pension plans as defined by the Railroad Retirement Act and, therefore, employee supplemental annuities should not be reduced due to the receipt of 401(k) distributions.

5. Are employee contributions to a 401(k) plan subject to Railroad Retirement Tier I and Tier II payroll taxes?

Yes. Federal budget legislation enacted in 1989 and effective January 1, 1990, provided that employee contributions to 401(k) plans are subject to Railroad Retirement payroll taxes and brought the treatment of 401(k) plans under Railroad Retirement law into conformity with the treatment of such plans under Social Security law. Consequently, employee contributions to a 401(k) plan are also treated as creditable compensation for Railroad Retirement benefit purposes. (For example, an employee earning $40,000 a year, but who has 10% of his earnings deferred under a 401(k) plan, would have only $36,000 reported to the IRS as earnings subject to federal income tax. However, the entire $40,000 would be subject to Railroad Retirement payroll taxes and therefore creditable as compensation under the Railroad Retirement Act.)

6. How can a person get more information about how private rail pensions and 401(k) plan payments affect supplemental annuities?

More information is available on RRB.gov or by contacting an RRB field office. It is important to know that while nearly all of the RRB’s 53 field offices are physically closed to the public until further notice because of the COVID-19 outbreak, they remain accessible by email and phone. Customers are encouraged to send a secure email to their local office by accessing the Field Office Locator and clicking on the link at the bottom of their local office’s page. Customers who prefer talking to an RRB employee can call the agency’s toll-free number (1-877-772-5772); however, they may experience lengthy wait times due to increased call volume caused by COVID-19 related issues.


Medicare Part B premiums for 2021

The Centers for Medicare & Medicaid Services (CMS) has announced that the standard monthly Part B premium will be $148.50 in 2021, an increase of $3.90 from $144.60 in 2020. Some Medicare beneficiaries will pay less than this amount because, by law, Part B premiums for current enrollees cannot increase by more than the amount of the cost-of-living adjustment for Social Security (Railroad Retirement Tier I) benefits.

Since the cost-of-living adjustment is 1.3% in 2021, some Medicare beneficiaries will see an increase in their Part B premiums but still pay less than $148.50. The standard premium amount will also apply to new enrollees in the program. However, certain beneficiaries will continue to pay higher premiums based on their modified adjusted gross income.

The monthly Part B premiums that include income-related adjustments for 2021 will range from $207.90 to $504.90, depending on the extent to which an individual beneficiary’s modified adjusted gross income exceeds $88,000 (or $176,000 for a married couple). The highest rate applies to beneficiaries whose incomes exceed $500,000 (or $750,000 for a married couple). CMS estimates that about 7% of Medicare beneficiaries pay the larger income-adjusted premiums.

Beneficiaries in Medicare Part D prescription drug coverage plans pay premiums that vary from plan to plan. Part D beneficiaries whose modified adjusted gross income exceeds the same income thresholds that apply to Part B premiums also pay a monthly adjustment amount. In 2021, the adjustment amount ranges from $12.30 to $77.10.

The Railroad Retirement Board withholds Part B premiums, Part B income-related adjustments and Part D income-related adjustments from benefit payments it processes. The agency can also withhold Part C and D premiums from benefit payments if an individual submits a request to his or her Part C or D insurance plan.

The following tables show the income-related Part B premium adjustments for 2021. The Social Security Administration (SSA) is responsible for all income-related monthly adjustment amount determinations. To make the determinations, SSA uses the most recent tax return information available from the Internal Revenue Service. For 2021, that will usually be the beneficiary’s 2019 tax return information. If that information is not available, SSA will use information from the 2018 tax return.

Railroad Retirement and Social Security Medicare beneficiaries affected by the 2021 Part B and D income-related premiums will receive a notice from SSA by the end of the year. The notice will include an explanation of the circumstances when a beneficiary may request a new determination. Persons who have questions or would like to request a new determination should contact SSA after receiving their notice.

Additional information about Medicare coverage, including specific benefits and deductibles, can be found at www.medicare.gov.

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2021 PART B PREMIUMS

Beneficiaries who file an individual tax return with income:Beneficiaries who file a joint tax return with income:Income-related monthly adjustment amountTotal monthly Part B premium amount
Less than or equal to $88,000Less than or equal to $176,000$0.00$148.50
Greater than $88,000 and less than or equal to $111,000Greater than $176,000 and less than or equal to $222,000$59.40$207.90
Greater than $111,000 and less than or equal to $138,000Greater than $222,000 and less than or equal to $276,000$148.50$297.00
Greater than $138,000 and less than or equal to $165,000Greater than $276,000 and less than or equal to $330,000$237.60$386.10
Greater than $165,000 and less than or equal to $500,000Greater than $330,000 and less than or equal to $750,000$326.70$475.20
$500,000 and above$750,000 and above$356.40$504.90

The monthly premium rates paid by beneficiaries who are married, but file a separate return from their spouses and who lived with their spouses at some time during the taxable year, are different. Those rates are as follows:

Beneficiaries who are married, but file a separate tax return, with income:Income-related monthly adjustment amountTotal monthly Part B premium amount
Less than or equal to $88,000$0.00$148.50
Greater than $88,000 and less than or equal to $412,000$326.70$475.20
$412,000 and above$356.40$504.90

RRB: Retirement seminar now available to view online

The Office of the Labor Member is pleased to announce that our Pre-Retirement Seminar presentation is now available to view online. We designed this program to help educate those nearing retirement about the benefits available to them, and what they can expect during the application process.

This popular program has become a valuable resource to RRB customers and employees alike. It helps promote a better understanding of our benefit programs among the railroad community, and in turn, improves the effectiveness of our benefit program operations.

While we typically conduct several seminars across the country annually, we were forced to cancel all in-person events this year due to the COVID-19 outbreak. This provided us with the unique opportunity to reimagine our platform capabilities and prioritize creating a web version of the seminar.

To access the video online, visit RRB.gov/PRS and click on View Pre-Retirement Seminar Presentation. Because we cover several aspects of railroad retirement benefits in great detail, the entire presentation is over an hour long. View shorter segments of the program by selecting a seminar topic on the same web page. Available topics include: Retired Employee and Spouse Benefits, Spouse Annuities, Working After Retirement, Survivor Benefits, and Items Affecting All Retirement and Survivor Benefits.

At this time, unemployment and sickness benefits are not covered in the program because of the ongoing uncertainty of additional COVID-19 relief legislation. We recommend visiting RRB.gov/coronavirus for the most up-to-date information.

RRB: Sequestration hits unemployment and sickness benefits

Railroad Unemployment and Sickness Benefits Will See Slight Decrease in New Sequestration Reduction Rate

Under the Budget Control Act of 2011, and a subsequent sequestration order to implement mandated cuts, railroad unemployment and sickness insurance benefits are reduced by a set percentage that is subject to revision at the beginning of each fiscal year.

Starting October 1, 2020, the U.S. Railroad Retirement Board (RRB) will reduce railroad unemployment and sickness insurance benefits by 5.7%, down from the current 5.9% reduction, as required by law. The adjusted reduction amount is based on revised projections of benefit claims and payments under the Railroad Unemployment Insurance Act and will remain in effect through September 30, 2021, the end of the fiscal year. Reductions in future fiscal years, should they occur, will be calculated based on applicable law.

The current daily benefit rate for both unemployment and sickness is $80.00. Applying the sequestration rate of 5.7%, the maximum amount payable in a two-week period will be reduced from $800.00 to $754.40. Sickness benefits paid to an employee within six months from the date last worked for a reason other than an on-the-job injury are also subject to regular tier I railroad retirement taxes, resulting in a further reduction of 7.65%. Applying the 5.7% reduction to these sickness benefits will result in a maximum two-week total of $696.69.

In fiscal year 2019, the RRB paid about $13 billion in retirement and survivor benefits to about 535,000 beneficiaries, and net unemployment-sickness benefits of about $93.4 million to approximately 23,000 claimants.

RRB: Coronavirus Relief Act impacts railroad workers

The Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, signed into law March 27, boosts unemployment and sickness benefits for railroad workers impacted by the pandemic.

Under the CARES Act, the 1-week waiting period required before railroad workers can receive unemployment or sickness benefits is temporarily eliminated. This applies to an employee’s first two-week registration period for a period of continuing sickness or unemployment beginning after the effective date of the law and ending on or before December 31, 2020.

In addition, the amount of the unemployment benefit is increased by $1,200 per 2-week period. This is in addition to the current biweekly maximum of $733.98 received by most claimants. This increased amount applies to any two-week registration periods beginning on or after April 1, 2020, through July 31, 2020.

The CARES Act includes a separate appropriation of $425 million to pay for this added “recovery benefit,” with an additional $50 million provided to cover the cost of eliminating the waiting period. If these funds are exhausted, the new provisions will no longer apply.

The CARES Act also authorizes payment of extended unemployment benefits to rail workers who received unemployment benefits from July 1, 2019, to June 30, 2020.

Under the legislation, railroad workers with fewer than 10 years of service may be eligible for up to 65 days of extended benefits within seven consecutive two-week registration periods. Workers with 10 or more years of railroad service who were previously eligible for up to 65 days in extended benefits may now receive benefits for up to 130 days within 13 consecutive two-week registration periods.

Since RRB offices are currently closed to the public due to the COVID-19 pandemic, railroad employees are encouraged to file for unemployment benefits online by establishing an account through myRRB at RRB.gov. Employees are encouraged to use a computer rather than a smartphone or tablet due to RRB IT system limitations. Otherwise, applications and claims for benefits will need to be submitted by regular mail. Applications for sickness benefits must be submitted to the agency by mail, or by fax at 312-751-7185. Subsequent claims may be completed online by those with myRRB accounts.

The RRB will also pay sickness benefits and, in some cases, unemployment benefits, to rail workers who have tested positive for COVID-19 or who are subject to a quarantine order. Further guidance on these types of situations is available at RRB.gov/Benefits/Coronavirus.

RRB: Message from the Labor Member of the Railroad Retirement Board, John Bragg

Bragg

The purpose of this notice is to update you on how COVID-19 is impacting operations at the Railroad Retirement Board (RRB). Be assured, while it is not business as usual, the agency remains open for business. Listed below are some of the more notable changes. Last week, my office sent a press release to rail labor on some of these topics. Hopefully this message will include more detailed information for you and your members.

Field Service Operations:

Last week, my office sent a press release to rail labor advising that field offices are closed to the public. Whenever possible, agency personnel, including field personnel, are working from home. Unfortunately, we expect delays with processing incoming work because as you know, much of our work is not automated. We receive applications and claims for both unemployment and sickness by mail and by fax. Because of safety concerns surrounding COVID-19, staff is only going into the office or to the post office on Tuesdays and Thursdays.

Self-Service Options:

Because of our concern regarding the delay in processing paper applications and claims, we are encouraging railroaders to set up myRRB.gov accounts on the RRB.gov website. I have attached information about all the services available through that account. Please feel free to share with your memberships. With that account, an employee can file for and submit claims for unemployment. A railroader can also submit sickness claims, though not the initial application. Usually, an initial sickness application is either mailed or faxed in from the employee’s doctor’s office to the agency at (312) 751-7185. If an employee is unable to do that or if delays persist, please contact my office at (312) 751-4905 and my staff will assist you in any way they can.

Benefit Payments:

We have received questions regarding the continuation of retirement and disability benefits. Fortunately,  that is overall an automated process and we do not expect any delays in paying those already established benefits. In addition, our actuary has assured us that the rail trust funds are well-positioned to pay all retirement, survivor, unemployment and sickness benefits. We are actively addressing questions regarding benefits payable under the RUIA and special circumstances raised by COVID-19.

Legislative Changes:

Related to legislative changes, there have been congressional proposals to remove sequestration from unemployment and sickness benefits; waive the statutory 7-day waiting period for unemployment and sickness benefits; increase the amount of unemployment benefits; and extend the duration of unemployment benefits. There have also been proposals to increase the RRB’s administrative budget in order to account for increased costs related to COVID-19. My staff, along with the agency’s Office of Legislative Affairs and other agency subject matter experts, have worked with congressional staffers as well as your unions to convey the information needed in order for the legislation to move forward.

These are trying times and the agency is doing its best to continue to pay the right people, the right benefits, at the right time. Things are changing quickly and I will update you in the future as the RRB makes adjustments. In the meantime, if you have any questions or problems, I and my staff are always available to assist.