Different from other unemployment and sickness benefits, railroad worker benefits are fully funded through payroll deduction and not government taxes. The federal government administers the program, but the government doesn’t fund railroad benefits. Therefore, it is unjust and unfair to take funds from railroaders who lost their jobs or became ill in order to do an accounting and budget-balancing trick that allows the federal government to spend more money elsewhere, what has become known as “sequestration.”
Following an aggressive lobbying campaign led by the Teamsters and the BLET, the Railroad Employee Equity and Fairness (REEF) Act was incorporated into the Servicemember Quality of Life Improvement and National Defense Authorization Act for Fiscal Year 2025, signed by President Biden on December 23, 2024, putting an end to this unjust cash grab.
“This victory has been a long time coming for the BLET and its members,” National President Eddie Hall said. “For more than 10 years now, individual railroad workers have unfairly had their unemployment and sickness benefits reduced by about $200 per month. We celebrate the elimination of these harmful cuts that unfairly targeted railroad workers.”
The Budget Control Act of 2011 and subsequent sequestration orders mandated cuts to railroad unemployment and sickness insurance benefits. This requirement was temporarily paused at the beginning of 2021 due to the coronavirus pandemic but resumed in May 2023. Since then, unemployment and sickness benefit amounts paid by the U.S. Railroad Retirement Board (RRB) have been reduced by 5.7 percent. The REEF Act eliminates that reduction and exempts railroad unemployment and sickness insurance benefits from sequestration in the future.
The current daily benefit rate for unemployment and sickness insurance benefits is $94.00. Applying the sequestration reduction of 5.7 percent reduced the maximum benefit in a 2-week period from $940.00 to $886.42. Starting December 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, RRB has said there will be a delay in calculating and issuing retroactive payments. Claimants should monitor the RRB website for information on progress related to retroactive payments. No action is required by claimants affected by this provision unless they have moved or changed their banking information, in which case they can report the new details by calling the RRB’s toll-free number at (877) 772-5772.