[Code of Federal Regulations]

[Title 20, Volume 1]

[Revised as of April 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 20CFR323.3]



[Page 557-558]

 

                      TITLE 20--EMPLOYEES' BENEFITS

 

                  CHAPTER II--RAILROAD RETIREMENT BOARD

 

PART 323_NONGOVERNMENTAL PLANS FOR UNEMPLOYMENT OR SICKNESS INSURANCE

--Table of Contents

 

Sec.  323.3  Standards for Board approval of a nongovernmental plan.



    An unemployment or sickness benefit plan qualifies as a 

nongovernmental plan if it conforms to the following standards:

    (a) The plan is in writing and has been published or otherwise 

communicated to covered employees prior to the inception of the plan;

    (b) Benefits under the plan are payable only to employees who are 

involuntarily laid off or separated from the service of the employer or 

who are absent from work on account of illness or injury;

    (c) Payment of benefits under the plan is conditioned upon a covered 

employee's meeting the eligibility conditions governing payment of 

benefits under the Railroad Unemployment Insurance Act. However, a plan 

will not be disqualified merely because it:

    (1) Provides benefits during any waiting period required under the 

Railroad Unemployment Insurance Act, or

    (2) Provides benefits after an employee has exhausted rights to 

benefits under the Railroad Unemployment Insurance Act, or

    (3) Provides benefits during a period when the employee is not a 

``qualified



[[Page 558]]



employee'', within the meaning of part 302 of this chapter;

    (d) Payment of benefits under the plan is coordinated with benefit 

payments to which the employee may be entitled under the Railroad 

Unemployment Insurance Act. In general, plan benefit payments will be 

considered coordinated with Railroad Unemployment Insurance Act benefit 

payments when computation of the plan benefits takes Railroad 

Unemployment Insurance Act benefit entitlement into consideration in 

such a way as to make it clear that the plan is supplementing Railroad 

Unemployment Insurance Act benefit payments for days of unemployment or 

days of sickness. For example, a plan that provides for payment of a 

specified daily benefit amount is considered coordinated with Railroad 

Unemployment Insurance Act benefit payments if the plan provides that 

the daily benefit amount otherwise payable to the employee is reduced by 

the amount of benefits that the employee received or could receive under 

the Railroad Unemployment Insurance Act for the same day if the employee 

had met all the eligibility criteria for such benefit. Similarly, there 

is acceptable coordination if the plan simply provides for payment of an 

amount as an ``add-on'' benefit to the amount of Railroad Unemployment 

Insurance Act benefits paid or payable. On the other hand, a plan that 

allows payment so as to compensate an employee for railroad or non-

railroad earnings that are lower in amount than what the employee would 

get under the plan if he or she were not employed is not considered 

coordinated with benefit payments under the Railroad Unemployment 

Insurance Act because an employer payment made under such circumstances 

supplements earnings rather than benefit payments under the Railroad 

Unemployment Insurance Act. No Railroad Unemployment Insurance Act 

benefits are payable to an employee who is earning remuneration from 

railroad or non-railroad employment. Employer payments that make up for 

low earnings are pay for time lost and therefore are compensation and 

remuneration;

    (e) The plan confers upon covered employees an enforceable right to 

the benefits under the plan. The plan may not commit to management 

discretion any decision as to whether such employee will actually be 

paid the benefits to which he is entitled under the plan or the amount 

to be paid;

    (f) The plan may not provide benefits to a covered employee in an 

amount that, when added to his or her Railroad Unemployment Insurance 

Act benefits, is greater than the wages of salary that would have been 

paid if the employee were employed; and

    (g) The plan incorporates the features set forth in Sec.  323.4 of 

this part and has been approved by the Board's Director of Unemployment 

and Sickness Insurance as a nongovernmental plan for unemployment or 

sickness insurance.