When it has been determined that a foreign pension is based in part on noncovered
earnings and in part on a payment which may not be used to apply WEP (see GN 00307.290C.5.), prorate the foreign pension in order to obtain only that part based on noncovered
earnings. Prorate the pension as follows:
multiply the total pension amount (after converting it from a weekly amount to a monthly
amount, if necessary) by the ratio of the number of months of noncovered work over
the total number of months used in the computation; therefore
multiply the pension amount by the total number of months of noncovered work after
divide this number by the total number of months used by the foreign country to compute
the pension, based on both noncovered work and the pension payment which may not be used to apply WEP.
EXAMPLE: A worker is entitled to a German pension of 400 deutsch marks (DM) based on periods
of employment and voluntary contributions in Germany from January 1951 through December
1970 (a total of 240 months). He made voluntary contributions to the German pension
plan from January 1968 through December 1970 (a total of 36 months).
Exclude months before 1957, since the WEP Guarantee applies only to noncovered earnings
after 1956. This yields 168 months.
Exclude the 36 months from 1968 through 1970 for which the worker made only voluntary
contributions; i.e., he did not work in noncovered employment. This leaves 132 months
during which the worker actually worked in noncovered employment after 1956.
Multiply 400DM 132/240; i.e., 400DM 132 months = 52,800 divided by 240 months =
220DM. Therefore, for purposes of the WEP Guarantee provision (see GN 00307.290F.), the worker's foreign pension is 220DM.
Treat any month for which there are both noncovered earnings and one of the non-usable payments above (e.g., a month for which voluntary contributions
were made) as a month of noncovered earnings.