SSR 62-14. WAGES -- RAILROAD COMPENSATION CREDITABLE UNDER SOCIAL SECURITY ACT

A man filed application for old-age insurance benefits. His social security earnings record contained no entries of earnings. However, he had rendered services as an employee of a railroad in 48 months, all occurring after 1936. Held, the compensation he received for his railroad service is creditable as wages in determining his entitlement to old-age insurance benefits, because he had not completed 10 years of railroad service.

M filed an application for old-age insurance benefits at age 87. His application, filed in June 1961, can entitle him to benefits beginning June 1960 if he was fully insured in that month. Since he attained age 65 before July 1954, he is fully insured in June 1960 if by the end of that month he had at least 6 quarters of coverage.

His social security earnings record showed no earnings at all, and on such record he would have no quarters of coverage. However, in connection with his application, M stated that he had worked as an employee of a railroad during several years, all occurring after 1936, but had never filed application for an annuity under the Railroad Retirement Act. This statement was verified by the Railroad Retirement Board, which certified the following additional information to the Social Security Administration: M had performed railroad service in 48 months during the period 1942-1946, and was credited for those years with compensation totalling $1,387 and with 17 compensation quarters of coverage under the Railroad Retirement Act.

M's entitlement to old-age insurance benefits thus depends upon whether the compensation for his railroad service is creditable as wages under the Act; if it is not creditable, M is not fully insured and cannot be entitled to the benefits claimed.

As pertinent in this case, wages are defined in section 209 of the Act as remuneration for employment; employment is defined in section 210(a) as service performed by an employee for an employer, except that certain types of service are excluded. Among these exclusions is service performed as an employee of a railroad, such service being covered under another Federal program, the Railroad Retirement Act. The exclusion is made by what is now section 210(a)(9) of the Social Security Act.

However, the Railroad Retirement Act was amended in 1951 to provide that after October 29, 1951, no retirement or survivor annuity may be awarded under that Act for a worker who has not completed 10 years of railroad service. Section 5(k)(1) of the Railroad Retirement Act was amended at the same time to provide, in effect, as follows: the provisions of what is now section 210(a)(9) of the Social Security Act shall not exclude railroad service from "employment" under the latter Act if such service would otherwise constitute employment under that Act, for purposes of determining entitlement to benefits on the earnings record of a worker who has not completed 10 years of railroad service. This amendment does not apply in cases where a retirement or survivor annuity based on less than 10 years of railroad service was awarded under the Railroad Retirement Act before October 30, 1951, and such annuity is currently payable.

Under Regulations No. 4 ยงยง 404.1408 and 404.1410, compensation received by a person for railroad service which is considered employment under section 210 of the Social Security Act shall be treated as wages; and where the Railroad Retirement Board has certified to the Administration in such a case that the worker has a specified number of compensation quarters of coverage under the Railroad Retirement Act, he will be presumed, in the absence of evidence to the contrary, to have an equal number of quarters of coverage under the Social Security Act.

Since M had less than 10 years of railroad service and had never been awarded an annuity under the Railroad Retirement Act, it is held that his railroad service performed after 1936 under conditions which meet the requirements of the definition of employment under the Social Security Act, must be treated as covered employment, and the $1,387 compensation for such service must be treated as wages. Also, since there is no evidence to the contrary, he is presumed to have 17 quarters of coverage in the years 1942-1946 by reason of he compensation quarters of coverage certified by the Railroad Retirement Board.

Therefore, M was fully insured in June 1960 and is entitled to old-age insurance benefits beginning with that month.


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