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PART I-RAILROAD RETIREMENT ACT OF 1937

“ANNUITIES

“SEC. 2. (a) * * * “1. * * *

[3.Individuals who will have attained the age of sixty and will have completed thirty years of service, but the annuity of such an individual shall be reduced by one one-hundred-and-eightieth for each calendar month that he is under age sixty-five when his annuity begins to accrue.]“. Individuals who will have attained the age of sixty and will have completed thirty years of serv. ice or, in the case of women, who will have attained the age of sixty-two and will have completed less than thirty years of service, but the annuity of such individual shall be reduced by one one-hundred-and-eightieth for each calendar month that he or she is under age sixty-five when the annuity begins to accrue.

“(d) No annuity shall be paid with respect to any month in which an individual in receipt of an annuity hereunder shall render compensated service to an employer or to the last person by whom he was employed prior to the date on which the annuity began to accrue. Individuals receiving annuities shall report to the Board immediately all such compensated service. No annuity under paragraph 4 or 5 of subsection (a) of this section shall be paid to an individual with respect to any month in which the individual is under age sixty-five and is paid more than $100 in earnings from employment or self-employment of any form: Provided, That for purposes of this paragraph, if a payment in any one calendar month is for accruals in more than one calendar month, such payment shall be deemed to have been paid in each of the months in which accrued to the extent accrued in such month. Any such individual under the age of sixty-five shall report to the Board any such payment of earnings for such employment or selfemployment before receipt and acceptance of an annuity for the second month following the month of such payment. A deduction shall be imposed, with respect to any such individual who fails to make such report, in the annuity or annuities otherwise due the individual, in an amount equal to the amount of the annuity for each month in which he is paid such earnings in such employment or self-employment, except that the first deduction imposed pursuant to this sentence shall in no case exceed an amount equal to the amount of the annuity otherwise due for the first month with respect to which the deduction is imposed. If pursuant to the third sentence of this subsection an annuity was not paid to an individual with respect to one or more months in any calendar year, and it is subsequently established that the total amount of such individual's earnings during such year as determined in accordance with that sentence (but exclusive of earnings for services described in the first sentence of this subsection) did not exceed $1,200, the annuity with respect to such month or months, and any deduction imposed by reason of the failure to report earnings for such month or months under the fifth sentence of this subsection, shall then be payable. If the total amount of such individual's earnings during such year (exclusive of earnings for services described in the first sentence of this subsection) is in excess of $1,200, the number of months in such year with respect to which an annuity is not pay. able by reason of such third and fifth sentences shall not exceed one month for each $100 of such excess, treating the last $50 or more of such excess as $100; and if the amount of the annuity has changed during such year, any payments of annuity which become payable solely by reason of the limitation contained in this sentence shall be made first with respect to the month or months for which the annuity is larger. “(e) SPOUSE'S ANNUITY.—The spouse of an individual, if

“(i) * * *

“(ii) such spouse has attained the age of 65 or in the case of a wife, has in her care (individually or joiutly with her husband) a child who, if her husband were then to die, would be entitled to a child's annuity under subsection (c) of section 5 of this Act,

1 Beginning quote before “3” in line one on page 2 of the bill has been omitted. 2 The word "became" in line 5 on page 3 of the bill should be "become."

shall be entitled to a spouse's annuity equal to one-half of such individual's annuity or pension, but not more, with respect to any month, [than an amount] than 110 per centum of an amount equal to the maximum amount which could be paid to anyone, with respect to such month, as a wife's insurance benefit under section 202(b) of the Social Security Act as amended from time to time: Provided, however, That if the annuity of the individual is awarded under paragraph 3 of subsection (a), the spouse's annuity shall be computed or recomputed as though such individual had been awarded the annuity to which he would have been entitled under paragraph 1 of said subsection: Provided further, That, if the annuity of the individual is awarded pursuant to a joint and survivor election, the spouse's annuity shall be computed or recomputed as though such individual had not made a joint and survivor election: And provided further, That any spouse's annuity shall be reduced by the amount of any annuity and the amount of any monthly insurance benefit, other than a wife's or husband's insurance benefit, to which such spouse is entitled, or on proper application would be entitled, under subsection (a) of this section or subsection (d) of section 7 of this Act or section 202 of the Social Security Act; except that if such spouse is disentitled to a wife's or husband's insurance benefit, or has had such benefit reduced, by reason of subsection (k) of section 202 of the Social Security Act, the reduction pursuant to this third proviso shall be only in the amount by which such spouse's monthly insurance benefit under said Act exceeds the wife's or husband's insurance benefit to which such spouse would have been entitled under that Act but for said subsection (k).

“(f) * * *

“(g) The spouse's annuity provided in subsection (e) shall, with respect to any month, be subject to the same provisions of subsection (d) as the individual's annuity, and, in addition, the spouse's annuity shall not be payable for any month if the individual's annuity is not payable for such month (or, in the case of a pensioner, would not be payable if the pension were an annuity) by reason of the provisions of said subsection (d). Such spouse's annuity shall cease at the end of the month preceding the month in which (i) the spouse or the individual dies, (ii) the spouse and the individual are absolutely divorced, or (iii), in the case of a wife under age 65 (other than a wife who is receiving such annuity by reason of an election under subsection (h)), she no longer has in her care a child who, if her husband were then to die, would be entitled to an annuity under subsection (c) of section 5 of this Act.

(1) A spouse who would be entitled to an annuity under subsection (e) if. she or he has attained the age of 65 may elect upon or after attaining the age 62 to receive such annuity, but the annuity in any such case shall be reduced by one one-hundred-and-eightieth for each calendar month that the spouse is under age 65 when the annuity begins to accrue.

"COMPUTATION OF ANNUITIES "SEC. 3. (a) The annuity shall be computed by multiplying an individual's ‘years of service' by the following percentages of his ‘monthly compensation': [3.047 3.35 per centum of the first $50; [2.28] 2.15 per centum of the next $100; and [1.52] 1.67 per centum of the next [$200] $250.

(b) * * *

"(c) The 'monthly compensation shall be the average compensation paid to an employee with respect to calendar months included in his 'years of service', except (1) that with respect to service prior to January 1, 1937, the monthly compensation shall be the average compensation paid to an employee with respect to calendar months included in his years of service in the years 1924–1931, and (2) the amount of compensation paid or attributable as paid to him with respect to each month of service before September 1941 as a station employee whose duties consisted of or included the carrying of passengers' hand baggage and otherwise assisting passengers at passenger stations and whose remuneration for service to the employer was, in whole or in substantial part, in the forms of tips, shall be the monthly average of the compensation paid to him as a station employee in his months of service in the period September 1940-August 1941 : Provided, however, That where service in the period 1924-1931 in the one case, or in the period September 1940-August 1941 in the other case, is, in the judgment of the Board, insufficient to constitute a fair and equitable basis for determining the amount of compensation paid or attributable as paid to him in each month of service before 1937, or September 1941, respectively, the Board

shall determine the amount of such compensation for each such month in such manner as in its judgment shall be fair and equitable. In computing the monthly compensation, no part of any month's compensation in excess of $300 for any month before July 1, 1954, or in excess of $350 for any month after June 30, 1954, and before January 1, 1959, or in excess of $400 for any month after December 31, 1958, shall be recognized. If the employee earned compensation in service after June 30, 1937, and after the last day of the calendar year in which he attained age sixty-five, such compensation and service shall be disregarded in computing the monthly compensation if the result of taking such compensation into account in such computation would be to diminish his annuity. If the 'monthly compensation' computed under this subsection is not a multiple of $1, it shall be rounded to the next lower multiple of $1.

“(d) * * *

(e) In the case of an individual having a current connection with the railroad industry, the minimum annuity payable shall, before any reduction pursuant to section 2(a) 3, be whichever of the following is the least: (1) [$4.55] $5.00 multiplied by the number of his years of service; or (2) [$75.90] $83.50; or (3) [his monthly compensation] 110 per centum of his monthly compensation : Provided, however, That if for any entire month in which an annuity accrues and is payable under this Act the annuity to which an employee is entitled under this Act (or would have been entitled except for a reduction pursuant to section 2(a) 3 or a joint and survivor election), together with his or her spouse's annuity, if any, or the total of survivor annuities under this Act deriving from the same employee, [is less than the amount, or the additional amount] is less than 110 per centum of the amount, or 110 per centum of the additional amount, which would have been payable to all persons for such month under the Social Security Act (deeming completely and partially insured individuals to be fully and currently insured, respectively, individuals entitled to insurance annuities under subsections (a) and (d) of section 5 to have attained age sixty-five, women entitled to spouse's annuities pursuant to elections made under subsection (h) of section 2 to be entitled to wife's insurance benefits determined under section 20 (9) of the Social Security Act, and individuals entitled to insurance annuities under subsection (c) of section 5 on the basis of disability to be less than eighteen years of age, and disregarding any possible deductions under subsections (f) and (g) (2) of section 203 of the Social Security Act) if such employee's service as an employee after December 31, 1936, were included in the term 'employment' as defined in that Act and quarters of coverage were determined in accordance with section 5(1) (4) of this Act, such annuity or annuities, shall be increased proportionately to a total of (such amount or such additional amount] 110 per centum of such amount or 110 per centum of such additional amount.

"ANNUITIES AND LUMP SUMS FOR SURVIVORS "SEC, 5. (a) *** (f) LUMP-SUM PAYMENT.-(1) * * *

“(2) Whenever it shall appear, with respect to the death of an employee on or after January 1, 1947, that no benefits, or no further benefits, other than benefits payable to a widow, widower, or parent upon attaining age sixty at a future date, will be payable under this section or, pursuant to subsection (k) of this section, upon attaining retirement age (as defined in section 216(a) of the Social Security Act) at a future date, will be payable under title II of the Social Security Act, as amended, there shall be paid to such person or persons as the deceased employee may have designated by a writing filed with the Board prior to his or her death, or if there be no designation, to the following person (or, if more than one, in equal shares to the persons) whose relationship to the deceased employee will have been determined by the Board and who will not have died before receiving payment of the lump sum provided for in this paragraph:

(i) the widow or widower of the deceased employee who was living with such employee at the time of such employee's death; or

“(ii) if there be no such widow or widower, to any child or children of such employee; or

“(iii) if there be no such widow, widower, or child, to any grandchild or grandchildren of such employee; or

“(iv) if there be no such widow, widower, child, or grandchild, to any parent or parents of such employee; or

“(v) if there be no such widow, widower, child, grandchild, or parent, to any brother or sister of such employee; or

"(vi) if there be no such widow, widower, child, grandchild, parent,

brother, or sister, to the estate of such employee, a lump sum in an amount equal to the sum of 4 per centum of his or her compensation paid after December 31, 1936, and prior to January 1, 1947, [and 7 per centum of his or her compensation after December 31, 1946 (exclusive in both cases of compensation in excess of $300 for any month before July 1, 1954, and in the latter case in excess of $350 for any month after June 30, 1954),] plus per centum of his or her compensation paid after December 31, 1946, and before January 1, 1959, plus 712 per centum of his or her compensation paid after December 31, 1958, and before January 1, 1962, plus 8 per centum of his or her compensation paid after December 31, 1961 (exclusive of compensation in excess of $300 for any month before July 1, 1954, and in excess of $350 for any month after June 30, 1954, and before January 1, 1959, and in excess of $400 for any month after December 31, 1958), minus the sum of all benefits paid to him or her, and to others deriving from him or her, during his or her life, or to others by reason of his or her death, under this Act, and pursuant to subsection (k) of this section, under title II of the Social Security Act, as amended : Provided, however, That if the employee is survived by a widow, widower, or parent who may upon attaining age sixty be entitled to further benefits under this section, or pursuant to subsection (k) of this section, upon attaining retirement age (as defined in section 216(a) of the Social Security Act) be entitled to further benefits under title II of the Social Security Act, as amended, such lump sum shall not be paid unless such widow, widower, or parent makes and files with the Board an irrevocable election, in such form as the Board may prescribe, to have such lump sum paid in lieu of all benefits to which such widow, widower, or parent might otherwise become entitled under this section or, pursuant to subsection (k) of this section, under title II of the Social Security Act, as amended. Such election shall be legally effective according to its terms. Nothing in this section shall operate to deprive a widow, widower, or parent making such election of any insurance benefits under title II of the Social Security Act, as amended, to which such widow, widower, or parent would have been entitled had this section not been enacted. The term 'benefits' as used in this paragraph includes all annuities payable under this Act, lump sums payable under paragraph (1) of this subsection, and insurance benefits and lump-sum payments under title II of the Social Security Act, as amended, pursuant to subsection (k) of this section, except that the deductions of the benefits which, pursuant to subsection (k) (1) of this section, are pair under title II of the Social Security Act, during the life of the employee to him or to her and to others deriving from him or her, shall be limited to such portions of such benefits as are payable solely by reason of the inclusion of service as an employee in 'employment' pursuant to said subsection (k) (1).

*

(h) MAXIMUM AND MINIMUM ANNUITY TOTALS.-Whenever according to the provisions of this section as to annuities, payable for a month with respect to the death of an employee, the total of annuities is more than [$33] $36.30 and exceeds either (a) ($176] $193.60, or (b) an amount equal to two and two-thirds times such employee's basic amount, whichever of such amounts is the lesser, such total of annuities shall, after any deductions under subsection (i), be reduced to such lesser amount or to [$33] $36.30, whichever is greater. Whenever such total of annuities is less than [$15.40] $16.95, such total shall, prior to any deductions under subsection (i), be increased to [$15.40] $16.95. “(i) Deductions from Annuities.-(1) * * *

“(i) * * *

“(ii) will have been under the age of seventy-two and for which month he is charged with any earnings under section 203(e) of the Social Security Act (or in which month he engaged on seven or more different calendar days in noncovered remunerative activity outside the United States (as defined in section 203(k) of the Social Security Act)) or, having engaged in any activity outside the United States, would be charged under such section 203(e) with any earnings derived from such activity if it had been an activity within the United States; and for purposes of this subdivision the Board shall have the authority to make such determinations and such suspensions of payment of benefits in the manner and to the extent that the Secretary of Health, Education, and Welfare would be authorized to do so under section 203(g) (3) of the Social Security Act if the individuals to whom this subdivision applies were entitled to benefits under section 202 of such Act; or

“(iii) * * *

(1) DEFINITION :.-For the purpose of this section the term "employee' includes an individual who will have been an “employee,' and

“(1) * * *

“(9) An employee's 'average monthly remuneration shall mean the quotient obtained by dividing (A) the sum of (i) the compensation paid to him after 1936 and before the employee's closing date, eliminating any excess over $300 for any calendar month before July 1, 1954, [and] any excess over $350 for any calendar month after June 30, 1954, and before January 1, 1959, and any excess over $400 for any calendar month after December 31, 1958, and (ii) if such compensation for any calendar year before 1955 is less than $3,600 or for any calendar year after 1954 and before 1959 is less than $4,200, or for any calendar year after 1958 is less than $4,800, and the average monthly remuneration computed on compensation alone is less than [$350] $400 and the employee has earned in such calendar year 'wages' as defined in paragraph (6) hereof, such wages, in an amount not to exceed the difference between the compensation for such year and $3,600 for years before 1955 [and $4,200 for years after 1954, by], $4,200 for years after 1954 and before 1959, and $4,800 for years after 1958, by (B) three times the number of quarters elapsing after 1936 and before the employee's closing date: Provided, That for the period prior to and including the calendar year in which he will have attained the age of twenty-two there shall be included in the divisor not more than three times the number of quarters of coverage in such period: Provided, further, That there shall be excluded from the divisor any calendar quarter which is not a quarter of coverage and during any part of which a retirement annuity will have been payable to him. An employee's 'closing date shall mean (A) the first day of the first calendar year in which such employee both had attained age 65 and was completely insured ; or (B) the first day of the calendar year in which such employee died; or (C) the first day of the calendar year following the year in which such employee died, whichever would produce the highest 'average monthly remuneration' as defined in the preceding sentence. If the amount of the “average monthly remuneration' as computed under this paragraph is not a multiple of $1, it shall be rounded to the next lower multiple of $1.

(10) The term 'basic amount shall mean

“(i) for an employee who will have been partially insured, or completely insured solely by virtue of paragraph (7) (i) or (7) (ii) or both: the sum of (A) [44] 49 per centum of his average monthly remuneration, up to and including $75; plus (B) [11] 12 per centum of such average monthly remuneration exceeding $75 and up to and including ($350] $400, plus (C) 1 per centum of the sum of (A) plus (B) multiplied by the number of years after 1936 in each of which the compensation, wages, or both, paid to him will have been equal to $200 or more; if the basic amount, thus computed, is less than [$15.40] $16.95 it shall be increased to [$15.40] $16.95 ;

“(ii) for an employee who will have been completely insured solely by virtue of paragraph (7) (iii): the sum of [44] 49 per centum of his monthly compensation if an annuity will have been payable to him, or, if a pension will have been payable to him, [44] 49 per centum of the average monthly earnings on which such pension was computed, up to and including $75, plus [11] 12 per centum of such compensation or earnings exceeding $75 and up to and including $300. If the average monthly earnings on which a pension payable to him was computed are not ascertainable from the records in the possession of the Board, the amount computed under this subdivision shall be [$36.66] $40.33, except that if the pension payable to him was less than [$27.50] $30.25, such amount shall be four-thirds of the amount of the pension or [$14.66] $16.13, whichever is greater. The term 'monthly compensation'shall, for the purposes of this subdivision, mean the monthly compensation used in computing the annuity;

“(iii) * * *

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