The Railroad Employee Equity and Fairness (REEF) Act, incorporated into the Servicemember Quality of Life Improvement and National Defense Authorization Act for Fiscal Year 2025 and signed into law by President Biden Dec. 23, 2024, ended the reduction of unemployment and sickness benefits paid to railroad employees due to a budget sequestration requirement.
“The Budget Control Act of 2011, and subsequent sequestration orders to implement mandated cuts, required that railroad unemployment and sickness insurance benefits be reduced by a set percentage,” the U.S. Railroad Retirement Board (RRB) explained. “This requirement was temporarily paused at the beginning of 2021 due to the coronavirus pandemic, but resumed on May 10, 2023. Since then, unemployment and sickness benefit amounts paid by RRB have been reduced by 5.7% The REEF Act (download below) eliminates that reduction and exempts railroad unemployment and sickness insurance benefits from sequestration.”
The current daily benefit rate for unemployment and sickness insurance benefits is $94.00. Applying the sequestration reduction of 5.7% reduced the maximum benefit in a two-week period from $940.00 to $886.42. Starting Dec. 26, 2024, the full amount is being paid, except for any required income/payroll tax withholding or garnishment orders.
In addition, the new law applies retroactively to May 10, 2023, when sequestration resumed after the pandemic. “Due to significant system programming required, there will be a delay in calculating and issuing retroactive payments,” RRB noted. “Claimants should monitor the RRB website for up-to-date information on progress related to retroactive payments. No action is required by claimants affected by this provision unless they have moved or changed banking information, in which case they can report the new information by calling the agency’s toll-free number at (877) 772-5772.”
