TN 34 (06-04)
RS 00605.320 FERS/FECA Offset
5 USC Sec. 8116(d)(2) requires that all benefits paid by the Department of Labor (DOL) for work-related injuries and deaths shall be offset by the amount of any concurrent Social Security retirement or survivor benefit which is attributable to Federal service.
DOL imposes this offset against the FERS/FECA benefit when the beneficiary receives both a FERS/FECA benefit and an SSA retirement or survivor benefit and both are based in part on the same earnings. The offset is based on information provided by SSA. This offset can only occur with covered Federal earnings for 1984 or later. Offset does not apply to the DOL benefit if the SSA benefit is a disability benefit. All of these cases are processed by the Office of International Operations regardless of SSN or other jurisdictional rules. The information forwarded to DOL is for their offset use only. It does not affect SSA's records or SSA benefits.
2. Procedure - General
SSA provides the actual benefit amounts which are shown on the MBR. These rates were computed using all covered earnings, including covered Federal earnings. For DOL, SSA computes a fictitious PIA excluding any covered Federal earnings. SSA then provides a set of rates for all beneficiaries based on that fictitious PIA. Because DOL does not have access to the beneficiary's payroll records, they cannot identify the earnings to be excluded. SSA must determine which earnings are covered Federal earnings (using a DEQY).
Send both sets of benefit rates to DOL. While the offset amount is usually the difference between the two rates, there is a guarantee which sometimes limits the offset amount based on years of CSRS service. This guarantee is computed by DOL. SSA is only responsible for providing the two sets of rates.
3. Beneficiary questions
DOL imposes the offset and is responsible for addressing any questions the annuitant may have about the process. However, DOL cannot explain how SSA computes PIAs. If a beneficiary questions how SSA determined the offset amount, the reply should explain that SSA computes the rates with and without the covered Federal earnings and DOL uses those figures to determine the offset amount.
4. Insured status
Insured status on these cases must be met using normal rules and using all earnings. Removing the covered Federal earnings is only done to compute the effect on the benefit rates. It is not material how the removal of those earnings affects the insured status. In other words, if insured status is met using all earnings, it is still met after removing those earnings.
If WEP applies to the SSA benefit, consider WEP in the fictitious computation. Assume a pension of $5,000 a month to prevent the WEP guarantee computation. If the NH is exempt from WEP based on 30 years of coverage, the exemption will apply even after earnings are deleted.
The amount of the Social Security benefit attributable to Federal service is determined using the following process.
1. DOL request
DOL forwards a request to SSA which contains the person's name, SSN, date of birth, date of death (if applicable), period of Federal service (if known), computation effective date and similar information about auxiliaries or survivors. The request is sent by FAX.
2. SSA rate with FERS
SSA provides payment history for requested names beginning with the computation effective date. This information can be obtained from the MBR if a retirement or survivor claim exists. Show the rates and dates on the request in the field labeled “SSA rate w/FERS.” On all requests, if no claim exists, annotate the request and return it. On a life claim, if the numberholder is not yet age 62, annotate the request and return it to DOL. If the only SSA benefit is a disability, benefit offset will not apply. Annotate the request that only disability benefits are payable and return to DOL.
3. SSA rate without FERS
For every benefit amount SSA provides, we must also compute a corresponding amount that would have applied if Federal earnings were not used in the computation. To do this, it is necessary to obtain a DEQY for all earnings from 1984 through the present. Identify all earnings paid by a Federal agency. (There is no list of Federal employers, but they can be identified by requesting the employer's address. Example: Shipyards, U.S. Department of the Army, U.S. Department of the Air Force, U.S. Department of Defense, etc.) Compute a fictitious benefit without using those earnings. Show those fictitious amounts on the request in the field labeled “SSA rate w/o FERS.”
a. Match the current rates
Use TITLE II/INTERACTIVE COMPS program 24 (ONLINE COMPUTATIONAL EARNINGS) to compute the current PIA. Remember to add in military service credits if used in the calculations. Only proven military periods can be used.
b. Remove the earnings
After you arrive at the current PIA, DO NOT HIT THE ENTER KEY. Instead, page back to the IC54 screen. Remove all covered Federal earnings for 1984 and later years. Use the new PIA to compute all rates for the DOL request. Remember to make all reductions and deductions that apply.
c. Complete the form
After the rates are computed, show the real rates and the fictitious rates on the request, sign and date the form and return it by mail to: U.S. Department of Labor, OWCP Central Mailroom, P.O. Box 8300, London, KY 40742. Do not send any other computation-related documents. DOL only needs the rates with and without the covered earnings.
d. Document the action
Scan the completed request for documentation purposes (ACR/FIN FIN).