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RAILROAD RETIREMENT

WEDNESDAY, JUNE 2, 1948

House of REPRESENTATIVEs, CoMMITTEE ON INTERSTATE AND FoREIGN CoMMERCE, Washington, D. C.

The committee met at 10 a.m., Hon. Charles A. Wolverton (chairman) presiding. The CHAIRMAN. The committee will come to order. The hearing this morning relates to the several bills that have been introduced dealing with railroad retirement and unemployment insurance. There would seem to be approximately 20 to 25 bills of that kind. Notice has been given to all the sponsors of this legislation that they might have opportunity to be present to speak for their particular bill. see in the audience some Members of Congress, and I assume that they have come in response to that notice. All of you are undoubtedly aware of the fact that considerable consideration has been given to this type of legislation by members of the committee, by Members of Congress, by representatives of the railroad brotherhoods, by representatives of railroad management, and perhaps in some instances by the public in general. I wish particularly to call your attention to the fact that the railroad brotherhoods and railroad management have been working over a period of weeks, maybe months, on this subject. I was very pleased to learn yesterday that between themselves they had agreed upon a bill which it was my pleasure to introduce. (The bill referred to is as follows:)

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A BILL To amend the Railroad Retirement Act of 1937, as amended, and the Railroad Unemployment Insurance Act, as amended, and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That subsection (a) of section 3 of the Railroad Retirement Act of 1937, as amended, is amended by changing “2” to “2.40”, “1%” to “1.80”, and “1” to “1.20". Subsection (e) of section 3 of the Railroad Retirement Act of 1937, as amended, is amended by changing “$3” to “$3.60” and “$50” to “$60”.

SEc. 2. Subsection (f) of section 5 of the Railroad Retirement Act of 1937, as amended, is amended by inserting “(1)” before “Upon”, by striking out “this subsection” wherever it occurs and inserting in lieu thereof “this paragraph”, and by adding at the end thereof the following new paragraph:

“(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 or parent upon attaining age sixty-five at a future date, will be payable under this section or, pursuant to subsection (k) of this section, under section 202 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 death, or if there be no designation, to the person or persons in the order provided in paragraph (1) of this subsection

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or, in the absence of such person or persons, to his estate, a lump sum in an amount equal to the sum of 4 per centum of his compensation paid after December 31, 1936, and prior to January 1, 1947, and 7 per centum of his compensation after December 31, 1946 (exclusive in both cases of compensation in excess of $300 for any month), minus the sum of all benefits paid to him, or to others by reason of his death, under this Act and, pursuant to subsection (k) of this section, under section 202 of the Social Security Act, as amended: Provided, however, That if the employee is survived by a widow or parent who may upon attaining age sixty-five be entitled to further benefits under this section, or pursuant to subsection (k) of this section, under section 202 of the Social Security Act, as amended, such lump sum shall not be paid unless such widow 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 or parent might otherwise become entitled under this section or, pursuant to subsection (k) of this section, under section 202 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 or parent making such election of any insurance benefits under section 202 of the Social Security Act, as amended, to which such widow 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 section 202 of the Social Security Act, as amended, pursuant to subsection (k) of this section.” SEc. 3. The provisions of section 1 hereof shall apply to all annuities under section 2 of the Railroad Retirement Act of 1937, as amended, accruing during calendar months following the month of enactment hereof other than joint and survivor annuities heretofore awarded and survivor annuities deriving from joint and survivor annuities heretofore awarded; and the provisions of section 2 hereof shall be effective as of January 1, 1947. All annuities under the Railroad Retirement Act of 1935 and all joint and survivor annuities heretofore awarded and survivor annuities deriving from joint and survivor annuities heretofore awarded, accruing during the calendar months following the month of enactment hereof, and all pensions due in months following the first calendar month after the enactment hereof, shall be increased by 20 per centum. All recertifications required by reason of the provisions of this Act shall be made by the Railroad Retirement Board without application therefor. SEc. 4. Subsection (a) of section 8 of the Railroad Unemployment Insurance Act, as amended, is amended by substituting the following for so much of said subsection as precedes the proviso: “(a) Every employer shall pay a contribution, with respect to having employees in his service, equal to the percentage determined as set forth below of so much of the compensation as is not in excess of $300 for any calendar month paid by him to any employee for services rendered to him after June 30, 1939:”. SEc. 5. (a) Subsection (a) of section 8 of the Railroad Unemployment Insurance Act, as amended, is further amended by substituting a colon for the period at the end thereof and adding the following: “1. With respect to compensation paid prior to January 1, 1948, the rate shall be 3 per centum; “2. With respect to compensation paid after December 31, 1947, the rate shall be as follows:

“If the balance to the credit of the railroad unemploy- The rate with respect to

ment insurance account as of the close of business compensation paid dur

on September 30 of any year, as determined by the ing the next succeeding

Board, is: calendar year shall be: $450,000,000 or more----------------------------- % percent. $400,000,000 or more but less than $450,000,000----- 1 percent. $350,000,000 or more but less than $400,000,000----- 1% percent. $300,000,000 or more but less than $350,000,000----- 2 percent. $250,000,000 or more but less than $300,000,000----- 2% percent. Less than $250,000,000--------------------------- 3 percent.

“As soon as practicable following the enactment of this Act, the Board shall determine and proclaim the balance to the credit of the account as of the close of business on September 30, 1947, and on or before December 31 of 1948 and of each succeeding year, the Board shall determine and proclaim the balance to the credit of the account as of the close of business on September 30 of such year.” (b) Contributions paid under subsection (a) of section 8 of the Railroad Unemployment Insurance Act, as amended, prior to the enactment of the foregoing amendment thereof which are in excess of those required by said subsection as so amended shall be subject to adjustment or refund in accordance with the provisions of subsections (d) and (e) of said section 8. SEc. 6. Subsection (f) of section 8 of the Railroad Unemployment Insurance Act, as amended, is amended to read as follows: “(f) The contributions required by this Act shall be collected by the Board and shall be deposited by it with the Secretary of the Treasury of the United States, such part thereof as equals 0.2 per centum of the total compensation on which such contributions are based to be deposited to the credit of the fund and the balance to be deposited to the credit of the account.” SEc. 7. Subsection (a) of section 10 of the Railroad Unemployment Insurance Act, as amended, is amended by substituting the following for subdivision (i) of the second sentence of said subsection: “(i) such part of all contributions collected pursuant to section 8 of this Act as is in excess of 0.2 per centum of the total compensation on which such contributions are based, together with all interest collected pursuant to section 8 (g) of this Act;”. SEc. 8. Subsection (a) of section 11 of the Railroad Unemployment Insurance Act, as amended, is amended by substituting the following for subdivision (i) of the second sentence of said subsection: “(i) such part of all contributions collected pursuant to section 8 of this Act as equals 0.2 per centum of the total compensation on which such contributions are based;”.

The CHAIRMAN. Mr. Crosser introduced a companion measure similar to the bill to which I have referred. This carries me back to the day when the original bill was passed which is now the law, which was the result of a conference between workers and management. I am pleased to see that in this present instance there is a continuation of that policy of talking together in an effort to agree. I am therefore happy, and I assume that every member of the committee is happy in the thought that there has been an agreement between these parties. Naturally, in view of that fact, I would think it can be assumed that special attention will be given to that agreed-upon bill. However, that does not preclude anyone who is opposed to the bill, or who has some other measure he wishes to advance, from doing so at this time. We are hopeful, however, that the presentations will not be unduly long. It is our intention to have this hearing this morning, and if it is not concluded, to conclude it this afternoon to the end that the committee may take immediate action with reference to reporting a bill. We recognize that we are coming to the close of the session. We recognize §. necessity of acting quickly. The committee is anxious to do so. I am hopeful that we can conclude these hearings today and that the committee can make its report to the Congress in the hope that whatever we report it will have an opportunity of coming before the House on a very early date, probably not later than Monday next. 1 ask that all cooperate to the end of endeavoling to present the matters relating to these retirements bills, or unemployment bills, in a way that will conserve the time of the committee as much as possible and at the same time do justice to your particular cause. I see two Members of Congress in the audience. I assume that they appear with reference to their bills. H. R. 12 was introduced by Mr. Angell, of Oregon. We will be pleased to hear Mr. Angell.

STATEMENT OF HON, HOMER D, ANGELL, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF OREGON

Mr. ANGELL. First of all, I would like to commend the committee for the excellent work they have done in arriving at a solution of this very difficult problem, and apparently, according to the statement of the chairman, it is satisfactory to the employers and the employees in the labor group. I hope the bill may be brought up very soon, as the chairman said, and pass before the recess takes place. I am appearing in support of H. R. 12, which I introduced early in the session. I have not had an opportunity to read H. R. 6766 because it is not available yet, and I am not, of course, advised as to whether the provision I am speaking of and seeking to forward is incorporated in your bill, Mr. Chairman. It is very simple. Let ‘me read it: An annuity shall accrue with respect to the month in which the annuitant dies; except that if death occurs on or before the 15th day of such month, only onehalf of the annuity for such month shall be considered to have accrued. My understanding of the law at present is that if an annuitant dies during the month, or even if he died on the last day of the month, the beneficiary would receive nothing for that month. Very frequently the moneys are already expended, anticipating that they would come in. It seems to me only just that this . should be enacted. As you will note, it provides that if death occurs before the 15th of the month, only one-half of the annuity for such month would be aid. p I hope if that language is not covered by the bill that you have introduced, or the legislation, this bill, H. R. 12, will be reported out favorably. The CHAIRMAN. The bills are available, Mr. Angell. I say that for the benefit of the other members and for those in the audience. I assume, then, from your remarks with such reservations as you made, you feel inclined toward H. R. 6766. Mr. ANGELL. Yes. The CHAIRMAN. We will now hear from Congressman Van Zandt, of Pennsylvania.

STATEMENT OF HON. JAMES E. WAN ZANDT, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF PENNSYLVANIA

Mr. WAN ZANDT. Mr. Chairman, I wish first to express my appreciation for the opportunity of appearing before you, and likewise I wish to join my colleague from Oregon in commending the committee for arriving at what I feel is a very acceptaple solution to this problem. I think the majority of the committe are familiar with the fact that I represent a congressional district which includes the city of Altoona, Pa., where are located the largest railroad shops in the world, and on a percentage basis I think more of my constituents are workers for a railroad, and from the standpoint of retired men, I think that I have the largest percentage of retired men in the country.

They have been very patient during this period of the high cost of living and have tried to exist. Many of them today are barely existing.

Yesterday morning at 7:30, just prior to my departure from Altoona to Washington, I had a retired gentleman visit me, and he pointed out that he and his wife were living on what might be termed one meal per day, as a result of the meager retirement benefits that he was receiving. He pleaded with me to have the Congress do something to relieve not only himself but many others in my congressional district who are trying to exist on this meager pension. I introduced some months ago H. R. 5000 and later on H. R. 5759, and like the committee, I was working in the direction of a solution. I am willing to stand aside, as far as my bills are concerned, and support the bill that was introduced by the chairman yesterday. I have had a chance to analyze it. It meets my approval. It meets my approval because it will do the very thing that is necessary today; that is, provide relief for the retired railroad worker who, as I said a moment ago, is barely existing on the benefits he receives today. So, Mr. Chairman, I wish to place the stamp of my approval, if it means anything to the committee, on H. R. 6766 and only hope that the Congress will enact this bill before we adjourn on the 19th of June. The CHAIRMAN. We appreciate having your statement, Mr. Van Zandt. We know that you have been interested in the subject over a long period of time, and the committee does appreciate your expression of support. Mr. Priest, I notice on the list there is a bill that you introduced. Do you have anything that you wish to say?

STATEMENT OF HON. J. PERCY PRIEST, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TENNESSEE AND A MEMBER OF THE COMMITTEE

Mr. PRIEST. When I was in my district last Christmas following our special session, I met with about 300 annuitants, retired railroad men in my district, and had quite a session with them, during which they discussed very frankly the difficulties that they were having making ends meet on their present annuities. I decided then that something should be done, and upon returning here I introduced a bill, a very simple bill, providing for $100 minimum annuity. I have gone over the bill proposed by the chairman and Mr. Crosser. I am in full agreement with the bill. I think that something should be done, and I very gladly withdraw my bill from consideration in order that the committee might concentrate its efforts on reporting the bill introduced yesterday.

The CHAIRMAN. Thank you, Mr. Priest. h A., here any other Members of Congress present who wish to be

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I might say that I, likewise, have introduced one or two bills on this subject that I thought were just about the finest things that had ever been prepared. I can assure you in the preparation of those bills I i. an awful lot of thought and consideration. I had the very valuable help of our staff, who worked in season and out in an effort to get what we considered a bill that would meet the requirements of our railroad workers.

However, I realize again, as I have so often realized that others can have thoughts different from my own that are still worthy of

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