Benefit
Provisions
The Railroad Unemployment Insurance Act provides benefits for qualified
railroad employees. The Act is designed to restore part of their wage loss
arising from unemployment or sickness (including maternity). Payments are made
for days of unemployment or sickness in a benefit year, which begins on July 1,
to employees who had sufficient earnings in the preceding calendar year (called
the base year) to meet the qualifying conditions.
Qualifications
Qualified employee.—A “qualified
employee” is one who earns qualifying creditable compensation in a base year
counting no more than a certain amount in any month. In addition, a new employee
must have some employment in at least five months of the first year worked in
the railroad industry in order to draw benefits in the following benefit year.
General eligibility requirements.—To
be eligible for unemployment benefits, a qualified employee must be able to work
and be available for work. A “day of unemployment” is a day on which he or she
meets these conditions and does not receive any pay, is not disqualified, and
has properly registered for unemployment benefits. Any calendar day on which the
employee does not work solely because of mileage-limitation or work-restriction
agreements or solely because he or she is between regularly assigned trips or
tours of duty or because a turn in pool service was missed is not considered a
day of unemployment.
To be eligible for sickness benefits, a qualified employee must be unable to
work because of illness or injury. A “day of sickness” is a day on which the
employee meets these conditions and for which he or she does not receive any pay
and has filed a “statement of sickness” providing evidence of the employee’s
medical condition and its expected duration signed by the employee’s doctor (or
other authorized individual).
Benefits
The maximum daily benefit payable in benefit year 2005-2006 (July 2005 - June
2006) is $56; and, for biweekly claims, maximum benefits can total $560. The
maximum daily benefit rate increases to $57 in July 2006 and $59 in July 2007
and may increase at the beginning of each future benefit year depending on the
growth in average national wages.
Sickness benefits payable for the first six months after the employee last
worked are subject to tier I railroad retirement payroll taxes, unless benefits
are being paid for an on-the-job injury.
Registration and waiting period.—Benefits
are normally paid for the number of days of unemployment or sickness over 4 in
14-day registration periods. Initial sickness claims must also begin with 4
consecutive days of sickness. However, during the first 14-day claim period in a
benefit year, benefits are only payable for each day of unemployment or sickness
in excess of 7 which, in effect, provides a 1-week waiting period. Separate
waiting periods are required for unemployment and sickness benefits. However,
only one 7-day waiting period is required during any period of continuing
unemployment or sickness, even if that period continues into a subsequent
benefit year.
Strike benefits.—If someone 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, no unemployment benefits are
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
the employee subsequently becomes unemployed for reasons other than a strike
later in the benefit year.
Normal benefits.—Normal benefits
are paid for up to 130 days (26 weeks) in a benefit year. Benefit rights are
exhausted when a benefit year ends (normally June 30) or earlier if benefit
payments equal base year creditable earnings. For purposes of determining
maximum normal benefits payable in benefit year 2005-2006, monthly earnings of
up to $1,460 for base year 2004 are counted; this allows employees who qualify
with relatively low earnings to be eligible for more days of benefits. In
benefit year 2006-2007, monthly earnings of up to $1,485 for base year 2005 are
counted and in benefit year 2007-2008, monthly earnings up to $1,544 for base
year 2006 are counted.
In order to qualify for normal unemployment benefits, the employee must not have
voluntarily quit work without good cause and not have voluntarily retired.
However, these restrictions do not apply to normal sickness benefits.
Extended benefits.—If an employee
has at least 10 years of service and exhausts normal unemployment or sickness
benefits, he or she may be eligible to receive extended benefits for up to 65
days (13 consecutive weeks). Also, if the employee is not qualified for normal
benefits in the current benefit year, but received normal benefits in the
previous year, he or she may still be eligible for extended benefits.
In order to qualify for extended unemployment benefits, the employee must not
have voluntarily quit work without good cause and not have voluntarily retired.
To qualify for extended sickness benefits, a beneficiary must not have
voluntarily retired and must be under age 65.
Accelerated benefits.—Employees
with 10 or more years of service whose earnings do not qualify them for
unemployment or sickness benefits in the current benefit year, but will qualify
them in the next benefit year, may be able to receive normal unemployment or
sickness benefits before the regular beginning date of the next benefit year. To
be eligible, they must have 14 or more consecutive days of unemployment or
sickness and not have voluntarily retired, or quit work without good cause if
claiming unemployment benefits, and be under age 65 when claiming sickness
benefits.
Maternity benefits.—Maternity
benefits are not payable as such. However, a qualified employee may receive
sickness benefits if she is unable to work or if working would be injurious to
her health because of pregnancy, miscarriage, or childbirth. Such benefits are
paid in the same amounts as any other sickness benefits.
Effects of Work and Earnings
A claimant may not receive benefits for any day for which pay is received.
This includes railroad and nonrailroad wages, salary, pay for time lost, pay
while sick, dismissal allowances, wage guaranty payments, vacation pay, holiday
pay, or remuneration other than subsidiary remuneration. However, payments
received under an approved nongovernmental supplemental unemployment or sickness
plan, an employee’s own health or accident insurance policy or a group insurance
policy will not affect entitlement to benefits and should not be reported on
claims.
An earnings test is applied to unemployment claims. If a claimant’s earnings for
days worked, and/or days of vacation, paid leave, or other pay, 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 requirement described
earlier. Earnings include pay from self-employment and railroad, nonrailroad,
and part-time work. Earnings also include pay that would have been earned except
for failure to mark up or report for duty on time, or because the employee
missed a turn in pool service or was otherwise not ready or willing to work. For
the benefit year that began July 2005, the amount is $1,130; for the benefit
year that begins July 2006, the amount will be $1,150; and for the benefit year
that begins July 2007, the amount will be $1,195. These amounts correspond to
the base year monthly compensation amounts 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.
On the other hand, earnings of no more than $15 a 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 be sure to
report all full and part-time work on each claim, regardless of the amount of
earnings, so the Board can determine whether the work affects benefits.
Disqualifications
A claimant for unemployment benefits may be disqualified for 30 days if he or
she refuses to accept suitable work or fails to follow instructions to apply for
work or to report to a Board office or State unemployment office for an
interview.
A claimant who leaves either railroad or nonrailroad work voluntarily without
good cause is disqualified, starting with the day he or she leaves work, until
he or she has returned to railroad employment and earned wages sufficient to
qualify for benefits again. This disqualification also applies to a claimant who
leaves work voluntarily with good cause, but only with respect to periods in
which he or she could receive unemployment benefits under another law.
A claimant is also disqualified for any day on which he or she takes part in a
strike begun in violation of the Railway Labor Act or in violation of the
established rules and practices of a labor organization of which he or she is a
member. This disqualification only applies to claimants who work on the premises
where the strike occurs and who do the same kind of work as the employees
participating or directly involved in the strike.
An employee who is paid a separation allowance is disqualified for both
unemployment and sickness benefits for roughly the period of time it would have
taken to earn the amount of the allowance.
A claimant may be disqualified for sickness benefits if he or she fails to take
a medical examination when required by the Board.
If a claimant makes a false or fraudulent statement or claim to obtain
unemployment or sickness benefits, he or she will be disqualified for 75 days
and may also be subject to a fine or imprisonment. The Board checks with Federal
agencies and all 50 States, the District of Columbia, and Puerto Rico as well as
railroads in order to detect fraudulent benefit claims. The Board also checks
with physicians to verify the accuracy of medical statements supporting sickness
benefit claims.
Payments Under Other Laws or Systems
If an employee receives a retirement, disability or survivor benefit under
the Railroad Retirement Act, Social Security Act, or any other social insurance
law for days for which he or she is also entitled to benefits under the Railroad
Unemployment Insurance Act, unemployment or sickness benefits are payable only
to the extent to which they exceed the other payments for those days. Examples
of other such social insurance payments are military pensions other than VA
benefits, firefighters’ and police pensions, or certain workers’ compensation
payments. Claimants should report all such other payments promptly to avoid
having to refund benefits later.
There is no reduction in unemployment or sickness benefits for benefits paid
under a Board-approved nongovernmental sickness insurance plan, such as a
supplemental sickness plan established by a railroad. Similarly, there is no
reduction in benefits if an employee receives supplemental unemployment benefits
under a Board-approved nongovernmental unemployment benefit plan. But
unemployment and sickness benefits provided under the Railroad Unemployment
Insurance Act are not payable if Federal/State unemployment or sickness benefits
under other laws, including Canadian law, are paid for the same period of time.
If an employee is awarded damages or receives a settlement because of an injury,
any sickness benefits already paid for the same injury will have to be deducted
from the settlement and refunded to the Board. Any benefits due for the same
injury for later periods may be withheld. The amount recoverable or withheld in
such cases cannot, however, exceed the net amount of the damages or settlement
after medical (even if covered by insurance) and legal expenses have been
deducted.
Unemployment benefits are normally not paid if an employee is fully protected
by a wage guaranty plan. If an employee receives unemployment or sickness
benefits, however, and is later paid a guaranty or other pay for time lost for
the same period, the employer will be asked to withhold an amount equal to the
unemployment or sickness benefits. The employer must then pay this amount to the
Board.
Payment Process
Claiming Unemployment Benefits
Claimants can apply for unemployment benefits by mail or online.
To apply by mail, claimants must obtain an application from their labor
organization, employer, local Railroad Retirement Board office or the Board’s
Web site. The completed application should be mailed to the local
Board office as soon as possible and, in any case, must be filed within 30 days
of the date on which 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.
To apply online, claimants should go to the Board's Web Site and click on
Benefit Online Services for directions on establishing an RRB Internet
Services account. Employees are encouraged to establish online accounts while
still employed so the account is ready if they ever need to apply for these
benefits or use other select Internet services.
The local Board office reviews the completed application, whether it was
submitted by mail or online, and notifies the claimant’s current railroad
employer, and base-year employer if different. The employer has the opportunity
to provide information about the benefit application.
After the Board processes the application, biweekly claim forms are mailed to
the claimant, and are also available on the Board’s Web site, as long as he or
she remains unemployed and eligible for benefits. Claim forms should be signed
and sent on or after the last day of the claim. This can be done by mail or
electronically. The completed claim must be received by a Board office within 15
days of the end of the claim or the date the claim was mailed to the claimant,
whichever is later.
Only one application need be filed during a benefit year, even if a claimant
becomes unemployed more than once. However, a claimant must, in such a case,
request a new claim form from a Board office or via the Board’s Web site within
30 days of the first day for which he or she wants to resume claiming benefits.
Claiming Sickness Benefits
An application for sickness benefits can be obtained from railroad employers,
railroad labor organizations, any Board office or the Board’s Web site. An
application and a doctor’s statement of sickness are required at the beginning
of each period of continuing sickness for which benefits are claimed. The Board
suggests that employees keep an application form on hand for use in claiming
sickness benefits. If the employee is too sick to complete the application,
someone else may do so. In that case, a family member should also complete form
SI-10, Statement of Authority to Act for Employee, and include it with the
application. Attached to each application is a statement of sickness which must
be completed by the employee’s doctor.
The forms should be completed and mailed to the Board in Chicago by the seventh
day of illness or injury. Applications received at the Board within 30 days of
the first day for which an employee wishes to claim benefits are generally
considered timely filed unless there is evidence to the contrary. After the
Board receives the application and statement of sickness and determines
eligibility, biweekly claim forms are mailed to the claimant for completion and
return to a Board field office for processing.
The claim forms must be received at the Board within 30 days of the last day of
the claim period, or within 30 days of the date the claim form was mailed to the
claimant, whichever is later. Benefits may be lost if an application or claim is
filed late.
Payments
Claimants who file an application for benefits may expect to receive a claim
form, or a decision on their application, within 15 days of the date the
application was filed. When filing biweekly claims, claimants may expect to
receive a payment, or a decision on their claim, within 15 days of the date a
Board office receives the claim form.
However, some claims for benefits may take longer to handle than others if they
are more complex, or if a Board office has to get information from other people
or organizations. If this happens, the claimant may expect an explanation and an
estimate of the time required to make a decision.
Railroad unemployment and sickness insurance benefits are paid by Direct
Deposit. With Direct Deposit, benefit payments are made electronically 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. Waivers are available to
individuals who determine that Direct Deposit would cause a hardship, and to
individuals without bank accounts.
Unemployment and sickness claimants can conveniently check on the status of
their claims or payments at any time by calling the toll-free RRB Help Line at
800-808-0772. Information may also be available online.
Free Placement Service
The Railroad Unemployment Insurance Act authorizes the Board to operate a
free placement service. The primary purpose of the placement service is to
secure new employment for experienced railroad workers who have lost their jobs.
When a claimant applies for unemployment benefits, he or she also applies for
employment service. The claimant will probably be interviewed by a Board
representative who will try to help secure employment if he or she does not have
good prospects of returning to his or her former job. The claimant may be
referred by the representative to a suitable railroad job; otherwise, an effort
will be made towards placement in a nonrailroad job for which the claimant
appears qualified.
As part of its placement service, the Board maintains a list of job openings
reported by railroads. The list is available for review at all offices of the
Board and on the Board’s Web site.
Appeals
Employees
If a claimant disagrees with a decision made on a claim, he or she has 60
days from the date of the initial notice of the decision in which to file a
written statement requesting reconsideration from the Board office that made the
decision. This step is mandatory before a decision may be appealed to the
Board’s Bureau of Hearings and Appeals. Failure to request reconsideration
within 60 days will result in forfeiture of further appeal rights.
If the case involves a benefit overpayment of more than 10 times the maximum
daily benefit rate, the claimant may request a waiver of repayment. A request
for waiver filed within 60 days will, in certain cases, defer recovery of the
overpayment from subsequent benefit payments. If waiver is requested, the
claimant may be asked to complete a financial statement on a form provided by
the Board.
If dissatisfied with the reconsideration or waiver decision, a claimant may,
within 60 days, appeal to the Board’s Bureau of Hearings and Appeals.
If not satisfied with the Bureau of Hearings and Appeals’ decision, a claimant
may further appeal, within 60 days, to the three-member Board.
If not satisfied with the three-member Board’s decision, a claimant may file a
petition for a review of the decision by a U.S. Court of Appeals. A petition for
review must be filed within 90 days of the notice of the Board’s decision.
Employers
When an employer is a party to a claim for benefits, that employer may
protest the payment of benefits, but such protests do not prevent the timely
payment of benefits. However, employees may be required to repay benefits if
their employers’ protests are ultimately successful. The employer also has the
right to appeal an unfavorable decision to the Bureau of Hearings and Appeals.
Income Taxes
Unemployment benefits paid by the Board are subject to Federal income taxes,
just like unemployment benefits paid under State government programs.
Sickness benefits paid by the Board, except for sickness benefits resulting from
on-the-job injuries, are subject to Federal income tax under the same
limitations and conditions that apply to the taxation of sick pay received by
workers in other industries.
The Railroad Unemployment Insurance Act specifically provides that railroad
unemployment and sickness benefits are not subject to State income taxes. In
January of each year, the Board sends railroad employees Form 1099-G showing the
total amount of unemployment benefits paid during the previous year and/or a
Form W-2 showing the net amount of sickness benefits paid. |