Treatment
of Payments Made to Employees on Active Duty
Supplemental
payments made to employees that have been called
to active duty are not considered creditable
compensation and should not be reported to the
Railroad Retirement Board (RRB). Payments
made to supplement the difference between the
employee’s military pay and regular earnings
are considered gratuities under the Railroad
Retirement Act (RRA) and Railroad Unemployment
Insurance Act (RUIA). Similarly,
employers should not pay or withhold RRTA taxes
against these payments.
Employees
may receive service month credit under the Acts
if the active duty period is during a national
period of emergency, but the employee
must otherwise meet the eligibility requirements
to receive credit for military service. Employees
can now file proof of their military service
with the local field office in advance. If
the RRB determines the military service to be
creditable it will reflect on their next Form
BA-6, Certificate of Service Months and Compensation.
Coming Soon: New RUIA
Appeal Form for Employers
Under
the RUIA, a base year employer may contest the
benefits paid to an employee. Employers
currently use the Form HA-1 entitled, “Appeal
Under the Railroad Retirement Act or The Railroad
Unemployment Insurance Act” which was designed
for appeals by employees.
The
RRB recently proposed Form HA-1 EMP entitled, “Base
Year Employer Appeal Under the Railroad Unemployment
Insurance Act” that will be used by employers.
That form is currently being developed. Due
to the small volume of appeals by employers,
the new form will only be available on the Board's
web site. We will notify employers when the Form
HA-1 EMP is finalized and officially ready for
use. Until then employers should continue to
file appeals on the current Form HA-1.
Revised ID-40R/S (Annual)
and ID-40Q (Quarterly) Notices under the RUIA
The
RRB has revised the ID-40R (Annual), ID-40S (System
Notice) and the ID-40Q (Quarterly) notices sent
to employers covered under the RUIA. The
revised notices now provide each employer with
a detailed breakdown of how their employer contribution
rate for RUIA is determined and provides the
employer with a list of the combined activity
of all subsidiary employers. The former
notices only provided employers with their contribution
rate and balances.
In
addition, the revision combines the former ID-40R
notice entitled, “Annual Notice to Employers – Railroad
Unemployment Insurance Act” and the former ID-40S
notice entitled, “Annual Proclamation – Railroad
Unemployment Insurance Act” notices into one
document now referred to as the ID-40R/S. |
The
new ID-40R/S notice notifies employers of their
RUIA contribution rate to be used during the
period of January 1 through December 31, 2005
and will be introduced and mailed by October
15, 2004. The new ID-40Q, which covers
the quarter from April 1, 2004 thru June 30,
2004, will be introduced and mailed by September
30, 2004.
Return to Railroad Service
Annuitants
who return to work for employers covered under
the RRA are not entitled to retirement annuities
from the RRB. If you are incorrectly crediting
former employees with service for pay in lieu
of vacation, back pay or any payment not associated
with actual work or a negotiated agreement, you
may be subjecting them to overpayments. Compensation
can be credited to an employees account when
paid, regardless of when the employee retires
or resigns. However, service months must be credited
when the service is performed. No additional
service months can be credited to an employee’s
earnings record after the employee actually stops
working and relinquishes his/her rights
to work for your company. If service
has been reported for your former employee after
his /her retirement annuity began you will receive
a Form GL-132, Notice of Service Reported for
Annuitant Who is Receiving an RRB Annuity.
This
form will help us determine whether the service
was credited properly. Please help us reconcile
these records by completing and returning this
form to our office within 30 days.
Changes to Employer Coverage
Status
If
your organization has experienced changes in
ownership or operations that may affect its coverage
status (i.e.: acquisition, merger, corporate
dissolutions) please notify the RRB as soon as
possible. RRB regulation (20 CFR 209.5)
states, it is the duty of each employer to promptly
notify the Board of any changes that may affect
its coverage status under the Acts. Any
coverage changes or issues should immediately
be address to the Chief of Audit and Compliance
at (312) 751-7120. |
