Remuneration

RAILROAD RETIREMENT BOARD

20 CFR Part 322

RIN 3220-AB38

Remuneration

AGENCY: Railroad Retirement Board.

ACTION: Proposed rule.

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SUMMARY: The Railroad Retirement Board (Board) proposes to amend its

regulations defining remuneration and how that term is applied to

claims for benefits under the Railroad Unemployment Insurance Act

(RUIA) to reflect changes in that statute and to reflect administrative

rulings not readily available to the public.

DATES: Comments should be submitted on or before January 18, 2000.

ADDRESSES: Any comments should be addressed to the Secretary to the

Board, Railroad Retirement Board, 844 North Rush Street, Chicago,

Illinois 60611.

FOR FURTHER INFORMATION CONTACT: Thomas W. Sadler, Senior Attorney,

Railroad Retirement Board, (312) 751-4513, FAX (312) 751-7102, TDD

(312) 751-4701.

SUPPLEMENTARY INFORMATION: As administrator of the RUIA, the Railroad

Retirement Board pays benefits to

[[Page 62136]]

qualified railroad employees for their days of unemployment or days of

sickness, as defined in section 1(k) of the Act. Benefits are not

payable for any day if ``remuneration'', as defined in section 1(j) of

the RUIA, is payable or accrues to the employee for such day. Part 322

defines the term ``remuneration'' and explains how the term is applied

to claims for benefits, but it has not been revised in recent years to

reflect statutory changes and agency practice and procedure.

Section 322.1 which currently recites applicable statutory

provisions, is proposed to be revised to provide a plain language

introduction that explains the purpose of part 322.

The general definition of ``remuneration'' set forth in Sec. 322.2

is proposed to be revised by expanding the definition to cover two

statutory exceptions to the definition, subsidiary remuneration and

supplemental unemployment or sickness benefits.

Section 322.3(b) is proposed to be amended by explaining that

although ``remuneration'' does not accrue for days that are termed

``layover'' days, such days are not compensable ``days of

unemployment''. Also, a new paragraph (d) is proposed to be added to

explain the rules that would apply to a fully employed employee who has

additional days off from work by reason of a compressed or flexible

work schedule.

Paragraph (a) of Sec. 322.4 is proposed to be revised by indicating

that the Board will seek information from the employee's base year

employer on whether remuneration is payable for days claimed.

Section 322.5 is proposed to be amended to remove a reference to an

obsolete regulation.

Paragraph (a) of Sec. 322.6 is proposed to be revised by indicating

that payments made to an employee with respect to personal injury are

considered remuneration unless allocated to other ``damages''.

Section 322.7 is proposed to be revised to conform with the

practices of the railroad industry that coordination and dismissal

allowances, separation, and severance payments are remuneration, even

when paid other than through a collective bargaining agreement, and

even when paid as the result of an involuntary dismissal or separation.

Section 322.8 is proposed to be amended to update the amount of

earnings by a local lodge official that may be regarded as subsidiary

remuneration. This amendment is necessary because of a statutory change

that increased to $15 per day the amount of an employee's earnings that

comes within the definition of subsidiary remuneration.

Finally, a new Sec. 322.9 is proposed to be added to explain the

term ``subsidiary remuneration''. Such remuneration does not prevent

payment of benefits, except as explained in Sec. 322.9.

The Board, with the concurrence of OMB, has determined that this is

not a significant regulatory action for purposes of Executive Order No.

12866. Therefore no regulatory impact analysis is required. The

information collection requirements contained in this rule have been

approved by the Office of Management and Budget under control numbers

3220-0049 and 3220-0022.

List of Subjects in 20 CFR Part 322

Railroad employees, Railroad unemployment benefits, Reporting and

recordkeeping requirements.

For the reasons set out in the preamble, the Railroad Retirement

Board proposes to amend title 20, chapter II, part 322 of the Code of

Federal Regulations as follows:

PART 322--REMUNERATION

1. The authority citation for part 322 is revised to read as

follows:

Authority: 45 U.S.C. 362(l).

2. Section 322.1 is revised to read as follows:

Sec. 322.1 Introduction.

The Railroad Unemployment Insurance Act provides benefits for a

qualified employee's days of unemployment or days of sickness, as

defined in section 1(k) of the Act. Under that section, no day can be a

day of unemployment or a day of sickness for any employee if

``remuneration'' is payable or accrues to the employee for such day. In

computing the amount of benefits payable to an employee for days of

unemployment or days of sickness in any registration period, or in

determining whether the employee has satisfied the waiting period

requirement, the Board will not count any day with respect to which

remuneration is payable or accrues to the employee. Section 322.2

defines the term ``remuneration'' and explains what types of payments

to employees constitute remuneration.

3. Section 322.2 is revised to read as follows:

Sec. 322.2 General definition of remuneration.

(a) Remuneration. (1) Remuneration includes pay for services for

hire, pay for time lost as defined in Sec. 322.6, and other earned

income payable or accruing with respect to any day. Income is

``earned'' if it is payable or accrues in consideration of services and

if such services were in turn rendered in consideration of the income

payable or accruing.

(2) Remuneration includes income in the form of a commodity,

service, or privilege if, before the performance of the service for

which it is payment, the parties have agreed upon the value of such

commodity, service, or privilege, and that such part of the amount

agreed upon to be paid may be paid in the form of such commodity,

service, or privilege.

(3) Remuneration for a working day that includes a part of two

consecutive calendar days is deemed to have been earned on the first of

such two days.

(b) Subsidiary remuneration. For the purpose of this part,

remuneration does not include subsidiary remuneration, as defined in

Sec. 322.9. Subsidiary remuneration for any day does not prevent such

day from being a day of unemployment or a day of sickness, except as

explained in Sec. 322.9.

(c) Supplemental unemployment or sickness benefits. The term

remuneration does not include money payments received by an employee

pursuant to any nongovernmental plan for unemployment or sickness

insurance, as defined in part 323 of this chapter. Employer payments of

sick pay to an employee are remuneration, except when payment is made

pursuant to a nongovernmental plan for sickness insurance.

4. In Sec. 322.3, revise paragraph (b), and add a new paragraph (d)

to read as follows:

Sec. 322.3 Determining the days with respect to which remuneration is

payable or accrues.

* * * * *

(b) Layover days. Remuneration shall not be regarded as payable or

accruing to an employee with respect to his or her ``layover'' days

between regular assignments in train and engine service solely because

they are termed ``layover'' days. But no such ``layover'' day may be

considered as a day of unemployment or sickness. See Sec. 332.6 of this

chapter.

* * * * *

(d) Equivalent of full-time work. An employee who works fewer than

five days each week under a compressed work schedule that provides the

equivalent of full-time employment does not earn remuneration with

respect to his or her additional rest days resulting from such work

schedule, but such employee will not be considered to be available for

work on such rest days. See Sec. 327.10(d) of this chapter.

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5. In Sec. 322.4, revise paragraph (a) to read as follows:

Sec. 322.4 Consideration of evidence.

(a) Initial proof. A claimant's certification that he or she did

not work on any day claimed and did not receive income such as vacation

pay or pay for time lost for any such day shall constitute sufficient

evidence for an initial finding that no remuneration is payable or has

accrued to him or her with respect to such day, unless a base year

employer reports that he or she worked on days claimed or received

payments that constitute remuneration as defined in this part, or

unless there is other conflicting evidence.

* * * * *

Sec. 322.5 [Amended].

6. Amend Sec. 322.5(c)(2) by removing ``in accordance with

Sec. 222.3(h) of this chapter''.

7. In Sec. 322.6, revise paragraph (a) to read as follows:

Sec. 322.6 Pay for time lost.

(a) Definition. The term ``pay for time lost'' means any payment

made to an employee with respect to an identifiable period of time

during which the employee was absent from the active service of the

person or company making the payment, including absence on account of

personal injury. The entire amount paid to an employee who was absent

on account of personal injury is pay for time lost if such amount

includes pay for time lost, unless at the time of payment the parties,

by agreement, specify a different amount as the amount of the pay for

time lost and the period of time covered by such pay. The amount

allocated to time lost is remuneration for every day in the period of

time lost. The amount of a payment for personal injury that is

apportioned to factors other than time lost is, nevertheless, a portion

of ``damages'' for the purposes of part 341 of this chapter.

* * * * *

8. Revise Sec. 322.7 to read as follows:

Sec. 322.7 Dismissal, coordination, and separation allowances.

(a) Coordination or dismissal allowance. Coordination or dismissal

allowances are payments made to an employee who has been furloughed for

a specified period of time during which he or she continues in an

employment relationship and remains subject to call. Such pay is

remuneration with respect to each day in the month or other period for

which it is payable. The employer shall be held liable to the Board for

any benefits paid to the employee and found recoverable under section

2(f) of the Railroad Unemployment Insurance Act by reason of the

payment of any such allowances or other pay for the same days for which

the Board paid benefits.

(b) Separation allowance. A separation allowance or severance

payment made to an employee who voluntarily or involuntarily terminates

his or her employment relationship is not remuneration with respect to

any day after the employment relationship is severed. An employee who

is paid a separation allowance, whether in a lump sum or in

installments, is disqualified by section 4(a-1)(iii) of the Railroad

Unemployment Insurance Act from receiving unemployment or sickness

benefits for the period of time approximating the length of time it

would have taken the employee to earn, at his or her ``straight'' time

rate of pay, the amount of the separation allowance if he or she had

continued working in the job from which he or she separated.

Sec. 322.8 [Amended].

9. In Sec. 322.8(e) remove the phrase ``three dollars'' and add in

its place ``$15''.

10. Add new Sec. 322.9 to read as follows:

Sec. 322.9 Subsidiary remuneration.

(a) Definition. The term ``subsidiary remuneration'' means

remuneration not in excess of an average of $15 per day for the period

with respect to which it is payable or accrues, if--

(1) The work from which the remuneration derives requires

substantially less than full time as determined by generally prevailing

standards; and

(2) The work is susceptible of performance at such times and under

such circumstances as not to be inconsistent with the holding of normal

full-time employment in another occupation.

(b) Exception. If a claimant's remuneration is ``compensation'' as

defined in part 302 of this chapter, such remuneration is not

subsidiary unless the claimant had base year compensation from a

different position or occupation of not less than two and one-half

times the monthly compensation base for months in the base year in

which he or she received the remuneration. Compensation in excess of an

average of $15 per day is remuneration for the days for which it is

payable or accrues.

(c) Period for which remuneration is payable or accrues. The

``period'' of time used in determining whether remuneration averages

more than $15 per day depends on the terms and conditions of the

employment and the rate of payment for the work. If the claimant is

paid a monthly salary, the ``month'' is the period with respect to

which the pay must average not more than $15 per day. The average is

the monthly salary divided by 30. If the claimant is paid a weekly

salary, the amount of the salary is divided by seven. If the claimant

is paid by the hour or the day, the ``period'' is the day. Where

payment is made by the hour or the day, the pay is not added up and

then averaged out over the week or the month. For example, earnings of

$20 on one day and $10 on another day do not average out to $15 per day

so as to permit both days to be considered as days of unemployment or

days of sickness.

(d) Substantially less than full time. The phrase ``substantially

less than full time'' means employment of not more than four hours per

day.

(e) Compatibility with full time employment. Work is considered to

be susceptible of performance at such times and under such

circumstances as not to be inconsistent with the holding of normal

full-time employment in another position or occupation if it is a form

of secondary employment that a claimant has done or could do at his or

her own convenience while performing the duties of his or her railroad

job.

(f) Determinations. The Board shall make a determination whether

remuneration is subsidiary by applying the standards in this section to

the facts of each case. Earnings that average more than $15 per day are

not subsidiary remuneration under any circumstances. Also, earnings of

any amount that are included in a claimant's qualifying base year

compensation are not subsidiary remuneration. Even if earnings do not

exceed an average of $15 per day, they may still not be subsidiary

remuneration if the claimant worked more than four hours per day or if

the work had to be performed at such times and under such circumstances

as to be inconsistent with the holding of normal full-time work in his

or her regular railroad work. If the evidence does not establish that

the earnings are subsidiary remuneration, the question whether they are

remuneration for particular days will then be considered.

(g) Examples. The following examples illustrate this section:

(1) A claimant receives a salary of $350 per month for serving as

secretary-treasurer of the local lodge of his union. He performs a

variety of duties at his own convenience while holding down a full-time

railroad job in his craft. The average payment per day is not more

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than $15 and is, therefore, subsidiary remuneration.

(2) A claimant worked three hours per day, at $5 per hour, in the

family insurance business. He was marked up for work as an extra board

trainman and worked whenever he was called. When called, he skipped

work in the family insurance business. His insurance earnings of $15

per day were subsidiary remuneration.

(3) While unemployed from her railroad job, a claimant took a job

as a school bus driver. She worked from 7 a.m. to 9 a.m., and 2:30 p.m.

to 5:30 p.m. Her regular railroad job was a daytime job from 8 a.m. to

4:30 p.m. Her pay as a school bus driver was not subsidiary

remuneration because the job was not compatible with the holding of

full time work in her regular railroad occupation.

Dated: November 4, 1999.

By Authority of the Board.

Beatrice Ezerski,

Secretary to the Board.

[FR Doc. 99-29655 Filed 11-15-99; 8:45 am]

BILLING CODE 7905-01-P