[Federal Register Volume 77, Number 166 (Monday, August 27, 2012)]
[Notices]
[Pages 51842-51843]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-21065]
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SOCIAL SECURITY ADMINISTRATION
[Docket No. SSA-2012-0046]
Social Security Acquiescence Ruling (AR) 12-X(8); Petersen v.
Astrue, 633 F.3d 633 (8th Cir. 2011); Whether a National Guard
Technician Who Worked in Noncovered Employment Is Exempt From the
Windfall Elimination Provision (WEP)--Title II of the Social Security
Act
AGENCY: Social Security Administration.
ACTION: Notice of Social Security Acquiescence Ruling.
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SUMMARY: We are publishing this Social Security Acquiescence Ruling
(AR) in accordance with 20 CFR 402.35(b)(2).
DATES: Effective Date: August 27, 2012.
FOR FURTHER INFORMATION CONTACT: Robert Crowe, Office of the General
Counsel, Office of Program Law, Social Security Administration, 6401
Security Boulevard, Baltimore, MD 21235-6401, (410) 965-3155, or TTY
410-966-5609, for information about this notice. For information on
eligibility or filing for benefits, call our national toll-free number,
1-800-772-1213 or TTY 1-800-325-0778, or visit our Internet site,
Social Security Online, at http://www.socialsecurity.gov.
SUPPLEMENTARY INFORMATION: An AR explains how we will apply a holding
in a decision of a United States Court of Appeals that we determine
conflicts with our interpretation of a provision of the Social Security
Act (the Act) or regulations when the Government has decided not to
seek further review of that decision or is unsuccessful on further
review.
We will apply the holding of the Court of Appeals' decision as
explained in this AR to all determinations or decisions at all levels
of administrative review within the Eighth Circuit. We will apply this
AR to all determinations or decisions made on or after August 27, 2012.
If we made a determination or decision to apply the WEP to your
retirement or disability benefits between February 3, 2011, the date of
the Court of Appeals' decision, and August 27, 2012, the effective date
of this AR, you may request that we apply the AR to the prior
determination or decision. You must show, pursuant to 20 CFR
404.985(b)(2), that applying the AR could change our prior
determination or decision in your case.
In addition, when we received this precedential Court of Appeals'
decision and determined that an AR might be required, we began to
identify those persons within the circuit who might be subject to
readjudication if we subsequently issued an AR. Because we have
determined that an AR is required and are publishing this AR, we will
send a notice to those individuals we have identified. In the notice,
we will provide information about the AR and their right to request
readjudication under the AR. However, affected individuals do not need
to receive a notice in order to request that we apply this AR to our
prior determination or decision, as provided in 20 CFR 404.985(b)(2).
If we later rescind this AR as obsolete, we will publish a notice
in the Federal Register to that effect, as provided in 20 CFR
404.985(e). If we decide to relitigate the issue covered by this AR, as
provided by 20 CFR 404.985(c), we will publish a notice in the Federal
Register stating that we will apply our interpretation of the Act or
regulations involved and explaining why we have decided to relitigate
the issue.
(Catalog of Federal Domestic Assistance, Program Nos. 96.001 Social
Security--Disability Insurance; 96.002 Social Security--Retirement
Insurance; 96.004 Social Security--Survivors Insurance)
Dated: August 21, 2012.
Michael J. Astrue,
Commissioner of Social Security.
Acquiescence Ruling 12-X(8)
Petersen v. Astrue, 633 F.3d 633 (8th Cir. 2011): Whether a
National Guard Technician Who Worked in Noncovered Employment Is Exempt
From the Windfall Elimination Provision (WEP)--Title II of the Social
Security Act.
Issue: Whether a National Guard technician who worked in noncovered
employment under the Civil Service Retirement System (CSRS) is subject
to the WEP.
Statutory and Regulatory Citation: Section 215(a)(7)(A)(III) of the
Social Security Act, 42 U.S.C. 415(a)(7)(A); 20 CFR 404.213(e)(9).
Circuit: Eighth (Arkansas, Iowa, Minnesota, Missouri, Nebraska,
North Dakota, and South Dakota).
Applicability of Ruling: This ruling applies to determinations or
decisions, at all levels of administrative review, i.e., initial,
reconsideration, administrative law judge (ALJ) hearing, and Appeals
Council.
Description of Case: Mr. Petersen was a technician with the
National Guard from 1972 to 2000. The National Guard Technician Act of
1968, Pub. L. 90-486, codified at 32 U.S.C. 709, made technicians with
the National Guard civil service employees of the United States
Government. Some technicians, like Mr. Petersen, have ``dual status''
because they are not only civilian employees but also military members
of the National Guard. Mr. Petersen received a civilian pension from
the CSRS for his work as a National Guard technician. His work as a
technician was not covered by Social Security, and Social Security
taxes were not withheld from his pay. Thus, his CSRS pension is based
wholly on noncovered civil service work.
Mr. Petersen applied for Social Security retirement benefits in
2006. Social Security found that he was entitled to benefits but
informed Mr. Petersen that his benefit amount would be reduced in
accordance with the WEP. The agency denied his request for
reconsideration. He requested a hearing by an ALJ, and the ALJ found
that Mr. Petersen's benefits should not be reduced because of the WEP.
The Appeals Council then reviewed the ALJ's decision on its own motion
and subsequently issued a decision finding that Mr. Petersen's benefits
were subject to reduction under the WEP. The Appeals Council's decision
was the agency's final decision.
Mr. Petersen requested judicial review of the agency's final
decision in accordance with 42 U.S.C. 405(g). On February 23, 2009, the
district court issued a decision finding that his benefits were not
subject to the WEP because 42 U.S.C. 415(a)(7)(A)(III) exempts from the
WEP those retirement payments based on service as a member of a
uniformed service. The district court found that Mr. Petersen's
National Guard technician service qualified him for this exception. The
Government appealed the district court's decision to the United States
Court of Appeals for the Eighth Circuit.
Holding
The Court of Appeals noted that ``dual status'' National Guard
technicians must maintain military membership in the National Guard and
are also required to wear their uniform, even when performing civilian
technician work. The Eighth Circuit held that, as a result of ``these
unique National Guard technician requirements imposed upon him,
Petersen performed his work `as a member of' the Nebraska Air National
Guard.'' Consequently, the Eighth Circuit found that Mr. Petersen
qualified for the exception to the WEP for work
[[Page 51843]]
performed ``as a member of the uniformed services.''
Statement as to How Petersen Differs From the Agency's Policy
The WEP is a modified formula for calculating the retirement or
disability benefits of a person who receives a pension from noncovered
work (i.e., work that is not defined as employment for Social Security
purposes and where Social Security taxes were not deducted from the
employee's pay). The WEP applies to persons who attain age 62 or become
eligible for disability benefits after 1985 and who first become
eligible for a monthly payment (such as a civil service pension) after
1985 ``which is based in whole or in part upon his or her earnings for
service which did not constitute `employment' as defined in'' 42 U.S.C.
410. 42 U.S.C. 415(a)(7)(A)(III). The WEP applies to persons with
noncovered employment in the CSRS which includes the civilian
employment of a ``dual status'' National Guard technician. A formula is
used to compute the person's primary insurance amount (PIA), which then
is used to compute the amount of the person's Social Security benefits.
42 U.S.C. 415(a)(7)(B); 20 CFR 404.213(c). The formula results in a
lower Social Security benefit.
Congress amended the WEP in 1994 in Pub. L. 103-296, the Social
Security Independence and Program Improvements Act of 1994 (the
Independence Act). Section 308 of the Independence Act, codified at 42
U.S.C. 415(a)(7)(A)(III), created a new exemption from the WEP, which
applies to ``a payment based wholly on service as a member of a
uniformed service'' as defined in 42 U.S.C. 410(m). We interpret the
uniformed services exception to the WEP to mean that only monthly
payments based on military service are exempt from the WEP. Under this
interpretation, monthly payments that are based on noncovered civilian
public employment, including that of National Guard technicians who
work under the CSRS, are not exempt from the WEP. Moreover, the effect
of the uniformed services exception to the WEP and the regulatory
provision found at 20 CFR 404.213(e)(9) is to exempt from the WEP only
military retirement pay based on reserve inactive duty training (IDT).
Other kinds of military duty, such as active duty, already were not
subject to the WEP because they have been covered employment since
1956. The WEP does not apply to noncovered work before 1957.
The legislative history of the uniformed services exception to the
WEP explains that the purpose of the exception was to exempt military
retired pay, based on noncovered IDT military duty, from application of
the WEP. The exception was not intended to exempt any pension based on
civilian work from application of the WEP. The Court of Appeals
declined to consider the legislative history of the uniformed services
exception because it found there was no ambiguity to the uniformed
services exception.
Explanation of How SSA Will Apply the Petersen Decision Within the
Circuit
Social Security old-age or disability applicants and beneficiaries
who receive a CSRS pension based on noncovered work as dual status
National Guard technicians, and who are permanent legal residents of a
State within the Eighth Circuit, should have their Social Security
benefits computed using the normal PIA, rather than the WEP PIA
described in 42 U.S.C. 415(a)(7) of the Act. A decisionmaker should not
apply this AR to an applicant or beneficiary who is not a permanent
legal resident of a State within the Eighth Circuit at the time of
making the determination or decision to apply the WEP. Before we
determine that the WEP does not apply, we must have evidence that an
applicant's or beneficiary's CSRS pension is based on service as a dual
status civilian technician with the National Guard.
[FR Doc. 2012-21065 Filed 8-24-12; 8:45 am]
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