ployer shall be disregarded with respect to any calendar month if the amount thereof is less than $3 and (1) such compensation is earned between December 31, 1936, and April 1, 1940, and taxes thereon pursuant to section 2(a) and 3(a) of the Carriers Taxing Act of 1937 or sections 1500 and 1520 of the Internal Revenue Code are not paid prior to July 1, 1940; or (2) such compensation is earned after March 31, 1840. A payment made by an employer to an individual through the employer's pay roll shall be presumed, in the absence of evidence to the contrary, to be compensation for service rendered by such individual as an employee of the employer in the period with respect to which the payment is made. An employee shall be deemed to be paid, "for time lost" the amount he is paid by an employer with respect to an identifiable period of absence from the active service of the employer, including absence on account of personal injury, and the amount he is paid by the employer for loss of earnings resulting from his displacement to a less remunerative position or occupation. If a payment is made by an employer with respect to a personal injury and includes pay for time lost, the total payment shall be deemed to be paid for time lost unless, at the time of payment, a part of such payment is specifically apportioned to factors other than time lost, in which event only such part of the payment as is not so apportioned shall be deemed to be paid for time lost. Compensation earned in any calendar month before 1947 shall be deemed paid in such month regardless of whether or when payment will have been in fact made, and compensation earned in any calendar year after 1946 but paid after the end of such calendar year shall be deemed to be compensation paid in the calendar year in which it will have been earned if it is so reported by the employer before February 1 of the next succeeding calendar year or, if the employee establishes, subject to the provisions of section 8, the period during which such compensation will have been earned. In determining the monthly compensation, the average monthly remuneration, and quarters of coverage of any employee, there shall be attributable as compensation paid to him in each calendar month in which he is in military service creditable under section 4 the amount of $160 in addition to the compensation, if any, paid to him with respect to such month. Compensation for service as a delegate to a national or international convention of a railway labor organization defined as an "employer" in subsection (a) of this section shall be disregarded for purposes of determining eligibility for and the amount of benefits pursuant to this Act if the individual rendering such service has not previously rendered service, other than as such a delegate, which may be included In his "years of service." (Section 1(h) of the act.) * 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 the calendar month [June 1959] next following the month in which this Act was amended in 1959 | May 1959], or in excess of $400 for any month after the month in which this Act was so amended and before the calendar month [November 1963] next following the month in which this Act was amended in 1963 [October 1963], or in excess of $450 for any month after the month in which this Act was so amended, 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. (Section 3(c) of the act) [Board Order 60-2, 25 F.R. 594, Jan. 23, 1960; 25 F.R. 1074, Feb. 6, 1960, as amended by Board Order 64-105, 29 F.R. 11916, Aug. 20. 1964]

§ 222.2 Definition of compensation.

(a) Compensation paid for services performed. Compensation shall mean the amount an individual is paid for service performed as an employee and shall include amounts paid in the form of a commodity, services, or privilege, only if the employer and employee, before the performance of the service for which it is payment have agreed (1) upon the value of such commodity, service, or privilege, and (2) that such part of the amount agreed upon to be paid may be paid in the form of such commodity, service, or privilege. Compensation shall also include allowances in lieu of vacation.

(b) Remuneration paid for time lost. Compensation shall also include amounts paid by an employer to an individual for time lost during which time the individual was absent from the active service of the employer. An employee shall be deemed to be paid "for time lost" whenever any such amount is paid to him by an employer (1) with respect to an identifiable period of absence from the active service of the employer, including absence on account of personal injury, or (2) for loss of earnings with respect to an identifiable period, resulting from his displacement to a less remunerative position or occupation. The entire amount of a payment made with respect to a personal injury shall be deemed to be remuneration paid for time lost pro

vided such an amount includes pay for time lost and is not, at the time of payment, specifically apportioned to factors other than time lost. In any case where an amount paid with respect to personal injury is, at the time of payment, apportioned to factors other than time lost, only that part of the amount not so apportioned shall be deemed to be remuneration paid for time lost.

(c) Waiver or refund of organization dues. A waiver or refund of organization dues, in ail cases in which the amount waived or refunded does not include elements in addition to the consideration for membership in the organization (such as, for example, insurance payments), even though motivated by the rendition of valuable services on the part of the individual to the organization, does not constitute compensation unless it appears by affirmative evidence that such waiver or refund was intended to be and was accepted as a discharge of an obligation of the organization to compensate the individual for service rendered.

[Board Order 47-1, 12 F.R. 466, Jan. 23, 1947, as amended by Board Order 51-130, 16 F.R. 4827, May 24, 1951]

§ 222.3 Creditability of compensation.

(a) Maximum creditable compensation for one month. In no case shall compensation in excess of $300 for any month of service before July 1, 1954, or in excess of $350 for any month of service after June 30, 1954, and before June 1, 1959, or in excess of $400 for any month of service after May 31, 1959, and before November 1, 1963, or in excess of $450 for any month of service after October 31, 1963, be recognized.

(b) Compensation dependent upon creditability of service. All compensation paid to an individual for service creditable in accordance with § 220.3 of this chapter, including compensation received for service performed after age 65, or after the beginning date of an annuity, shall be credited: Provided, however, That the crediting of such compensation shall be limited as prescribed in paragraph (a) of this section: Provided further, That if the individual earned compensation in service after June 30, 1937, and after the calendar year in which he attained age 65, such compensation 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: And provided further, That if the monthly compensation based on compensation creditable under this section and as determined on or after September 6, 1958, under § 225.3 of this chapter is not a multiple of $1, it shall be rounded to the next lower multiple of $1.

(c) Employee representative compensation. (1) If an individual occupies the position or office of employee representative as defined in section 1 (b) of the 1937 act and is paid remuneration in that position or office, all such remuneration is paid for services rendered as an employee representative within the meaning of section 1 (h) of the act, even though the individual performs either in connection with or outside of that position or office some services which are not related to the representation of employees in negotiations with employers regarding wages, hours, working conditions, etc. However, any other remuneration which the individual receives is not paid for service rendered as an employee representative within the meaning of section 1 (h).

(2) If an individual does not occupy the position or office of employee representative and is paid remuneration in another position or office, none of such remuneration is paid for services rendered as an employee representative within the meaning of section 1 (h) of the 1937 act, even though the individual performs either in connection with or outside of the non-employee representative position some services which are related to the representation of employees in negotiations with employers regarding wages, hours, working conditions, etc. Likewise, if the individual does occupy the position or office of employee representative in addition to his other position or office, but is paid remuneration only in the non-employee representative position or office or for services not related to the representation of employees in negotiations with employers, none of such remuneration is paid for service rendered as an employee representative within the meaning of section 1 (h).

(d) Compensation earned after December 31, 1936, for service rendered to a local lodge or division. Compensation earned in any month after December 31, 1936, for service rendered to a local lodge or division of a railway-labororganization employer shall be disre→

garded unless (1) it is $3.00 or more, or (2) if less than $3.00 it was earned prior to April 1, 1940, and with respect thereto the income and excise taxes prescribed in the Railroad Retirement Tax Act were paid prior to July 1, 1940.

(e) Compensation for service as a delegate to a convention of a railway labor received organization. Compensation on or after April 1, 1954, as a delegate to a national or international convention of a railway labor organization defined as an "employer" in section 1 (a) of the act shall be disregarded in determining an individual's eligibility for benefits and the amount of such benefits if the individual has not previousy rendered service, other than as such a delegate, which may be included in his “years of service."

(f) When compensation earned will be deemed compensation paid. Compensation earned in any calendar month before 1947 shall be deemed paid in such month regardless of whether or when payment will have been in fact made, and compensation earned in any calendar year after 1946 but paid after the end of such calendar year shall be deemed to be compensation paid in the calendar year in which it will have been earned if it is so reported by the employer before February 1 of the next succeeding calendar year or, if the employee establishes, subject to the provisions of section 8 of the act, the period during which such compensation will have been earned.

(g) Compensation; payment. Compensation is deemed to be paid:

(1) When it is actually paid; or

(2) When it is constructively paid, that is, credited to the account of or set apart for an employee without any substantial limitation or restriction as to the time or manner of payment or condition upon which payment is to be made, and made available to him so that it may be drawn upon at any time and its payment brought within his own control and disposition.

(h) Allowances in lieu of vacation. Compensation shall include allowances in lieu of vacations. If an employee dies, or ceases service for the purpose of receiving an annuity, and a vacation allowance is thereafter paid, the Board may, in the interest of the employee, credit the allowance to the last day of service or allocate the compensation to a period during his life following the last

[Board Order 55-89, 20 F. R. 3710, May 27, 1955]

§ 222.5 Verification of compensation claimed.

(a) Compensation claimed shall be verified to the extent deemed necessary by the Board to determine the "monthly compensation" referred to in § 225.3 of this chapter and shall be verified from employers' pay roll or other detailed records.

(b) In any case involving verification of compensation, the Board may prescribe the extent and manner in which such compensation shall be established. [Board Order 59-19, 24 F.R. 1247, Feb. 18, 1959]

Sec.

225.11 Annuity subject to recomputation.
225.12 Rounding annuity.
225.13 Commutation of annuity.

AUTHORITY: The provisions of this Part 225 issued under secs. 3, 10, 50 Stat. 310, as amended, 314, as amended; 45 U.S.C. 228c, 228j, unless otherwise noted.

§ 225.1 Formula for computing annuity.

An annuity for a month shall be computed by multiplying an individual's "years of service" by the following percentages of his "monthly compensation": 3.35 percent of the first $50; 2.51 percent of the next $100; and 1.67 percent of the next $300.

[Board Order 64-105, 29 F.R. 11916, Aug. 20, 1964]

§ 225.2 Determination of "years of

(a) The "monthly compensation" of an individual shall be:

(1) If his "years of service" include only service subsequent to December 31, 1936, and, in the case of station employees described in paragraph (b) (2) of this section, only service subsequent to August 31, 1941, the result obtained by totaling the compensation received for his "years of service" and dividing that sum by the number of months of his "years of service";

(2) If his "years of service" include only service prior to January 1, 1937, and, in the case of station employees described in paragraph (b)(2) of this section, only service prior to September 1941, his "monthly compensation for service prior to January 1, 1937," or prior to September 1941, respectively, determined as provided in paragraph (b) of this section;

(3) If his "years of service" include service subsequent to December 31, 1936, and service prior to January 1, 1937, the result obtained by (i) multiplying his "monthly compensation for service prior to January 1, 1937," determined as provided in paragraph (b) of this section, by the number of months in such portion of his "years of service" as is prior to January 1, 1937, (ii) adding to the product the total compensation earned by him in such portion of his "years of serv

ice" as is subsequent to December 31, 1936, and (iii) dividing the sum by the total number of months in his "years of service": Provided, however, That in the case of station employees described in paragraph (b) (2) of this section, if his "years of service" include service subsequent to August 31, 1941, and service prior to September 1941, the result obtained by (a) multiplying his monthly compensation for service prior to September 1941 determined as provided in paragraph (b) of this section by the number of months in such portion of his "years of service" as is prior to September 1941, (b) adding to the product the total compensation earned by him in such portion of his “years of service" as is subsequent to August 31, 1941, and (c) dividing the sum by the total number of months in his "years of service."

(b) In determining "monthly compensation," the rules set forth in this paragraph shall be applied, the Board having found, pursuant to the proviso in section 3(c) of the Railroad Retirement Act, that in any case to which subdivision (ii), (iii), or (iv) of subparagraph (1) of this paragraph applies, the service included in the "years of service" in the period 1924-31 is insufficient to constitute a fair and equitable basis for determining the amount of compensation paid to the individual in each month of service before 1937, and that the method provided in such subdivisions for determining the amount of such compensation for each such month is fair and equitable in every case to which such method is specified as applicable.

(1) For an individual other than a station employee described in subparagraph (2) of this paragraph, "monthly compensation for service prior to January 1, 1937," shall be determined under the first of the following subdivisions which may be applicable:

(i) (a) If 18 or more months of proved service in the period 1924-31 are included in the individual's "years of service" and compensation records are available for at least one-half but rot less than 18 of such months, the "monthly compensation for service prior to January 1, 1937," shall be the result obtained by dividing the number of months in the period 1924-31 which are included in the "years of service" and for which compensation records are available into the creditable compensation earned in such months.

(b) If compensation records are not available for at least one-half or for 18, whichever is higher, of the months of proved service in the period 1924-31 that are included in the individual's "years of service," the "monthly compensation for service prior to January 1, 1937," shall be the higher of: (1) The monthly average of the compensation earned in the months in the period 1924-31 which are included in the "years of service" and for which compensation records are available; or (2) the Interstate Commerce Commission average.

(ii) (a) If 18 or more months of service are proved in the period 1924-31 but less than 18 months in such period are included in the individual's "years of service," the "monthly compensation for service prior to January 1, 1937," shall be the monthly average of the compensation earned in the last 18 months of proved service in the period 1924-31 provided that compensation records are available for all such 18 months.

(b) If compensation records are not available for all of the last 18 months of proved service in the period 1924-31, the "monthly compensation for service prior to January 1, 1937," shall be the higher of: (1) The monthly average of the compensation earned in those months in the last 18 months of proved service in the period 1924-31 for which compensation records are available; or (2) the Interstate Commerce Commission average.

(iii) (a) If the individual's service began before 1932 but less than 18 months of service are proved in the period 192431, the "monthly compensation for service prior to January 1, 1937," shall be the higher of: (1) The monthly average of the compensation earned in the months in the period 1924-36 which are included in the individual's "years of service" and for which compensation records are available; or (2) the Interstate Commerce Commission average.

(b) If no service was proved in the period 1924-36 but service prior thereto is proved and is included in the individual's "years of service," the "monthly compensation for service prior to January 1, 1937," shall be the Interstate Commerce Commission average for the occupation in which the individual was last engaged prior to 1924.

(iv) If the individual's service began after 1931, the "monthly compensation for service prior to January 1, 1937," shall be the higher of: (a) The monthly

average of the compensation earned in the months in the period 1932-36 which are included in the individual's "years of service" and for which compensation records are available; or (b) the Interstate Commerce Commission average.

(2) For 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 form of tips, the "monthly compensation" paid or attributable as paid with respect to each month of service before September 1941 shall be the result obtained by dividing (i) the creditable compensation earned by him as a station employee in the period September 1940-August 1941 by (ii) the number of months he rendered service as a station employee during that period: Provided, however, That in any case in which service of a station employee in the period September 1940August 1941 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 September 1941, 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.

The following paragraphs of this section shall not be applicable to station employees.

(c) (1) The term "occupation” as used in this chapter shall mean that activity in which an individual was engaged while in the service of an employer.

(2) If an individual was engaged in more than one "occupation" in any calendar month, he shall be considered to have been engaged throughout that calendar month in whichever one of such "occupations" has the highest Interstate Commerce Commission average.

(d) (1) The term "Interstate Commerce Commission average" as used in this chapter shall mean the consolidated monthly average of employee earnings reported to the Interstate Commerce Commission for the years 1924-31 by all Class I carrier-employers for employees in the occupation in which the individual was employed during the period specified, or in an occupation essentially similar thereto.

(2) For any individual who was employed in two or more occupations in the