September 22, 2017
“I’ve been working on the railroad, all the live long day…”
If that familiar lyric rings true for you, then you probably aren’t eligible to receive Social Security benefits.
Railroad workers are famously exempt from receiving Social Security benefits. This includes not only Social Security retirement benefits, but also disability benefits.
Why are railroad workers ineligible for Social Security, even if they have been working “all the live long day”? To answer that, we’ll have to take a look back at the 1930s.
The Railroad Retirement Program
Social Security didn’t always exist. In 1935, President Franklin Roosevelt signed the Social Security Act into law. Social Security numbers had to be assigned, but a person’s SSN was not yet used as a form of identification the way that it is today, so only people nearing retirement applied for one.
It wasn’t until 1954 that the Social Security Amendments created a disability insurance program, but even that program looked little like the program we have today. The amendment simply froze a disabled worker’s Social Security record until they were able to return to work. It wasn’t until 1956 that the disability program started providing actual benefits to disabled workers.
Although Social Security feels like a given today, that wasn’t always the case. Many companies were worried about their pension programs and whether or not they could actually provide for their retired workers. Although the plan to create Social Security was already in the works, it wouldn’t cover work before 1937 and wouldn’t begin paying benefits for several years.
In 1934, a year before Social Security was signed into law, Congress passed the Railroad Retirement Act to establish a national railroad retirement system. After a few legal hurdles, the program was officially established in 1937. The program was expanded in 1946 to include survivor benefits, sickness benefits, and occupational disability benefits.
What’s the Difference in Disability Benefits?
The Railroad Retirement Program and Social Security both offer disability benefits to those who are eligible for their programs. Both programs use the same definition of disability and the same formula to determine whether or not a person meets that definition.
However, for Social Security disability benefits, a person must be proven totally disabled and unable to engage in substantial gainful activity (SGA). In addition to total disability, the Railroad Retirement Program also offers an occupational disability benefit to people whose disabilities prevent them from engaging in railroad work only. To qualify for the occupational disability benefit, a person must either have worked on the railroad for 20 years and be currently connected to the industry or be at least 60 years old with 10 years of railroad service and be currently connected to the industry.
Although railroad workers can only receive benefits from the Railroad Retirement Board (RRB) and not the Social Security Administration (SSA), they can count their work credits from Social Security toward their RRB disability benefits.
This means that if a railroad worker has only worked on the railroad for the past five years but needs to apply for disability benefits, he may still be eligible if he has 20 Social Security work credits from the last 10 years earned from previous work in another industry.
For example: if a person worked in food service for five years and paid Social Security taxes before taking a job with the railroad and working in the railroad industry for five years, she would be able to apply for disability benefits with the RRB.
Who Else Is Exempt from Social Security?
Although the railroad industry is by far the largest example of a group who sought exemption from Social Security, there are others as well.
Certain religious groups are exempt from Social Security. In order to be exempt from paying Social Security taxes, the religious group must have:
- A religious reason for opposing a program like Social Security (many exempt religious groups view it as a form of gambling)
- Existed since 1950
- Renounced their right to withdraw benefits from Social Security
- Made reasonable provisions to care for their elderly and disabled in place of Social Security
Well-known religious groups exempt from Social Security include the Amish and Mennonites.
Some state government workers are also exempt for Social Security. Their state pension plan takes the place of Social Security instead.
Help from an Indiana Disability Attorney
Although there are some groups of people who are known to be exempt from Social Security, most people aren’t part of these groups and are unsure if they could potentially qualify for disability benefits.
If you’re in need of disability benefits, Hensley Legal Group can help. Call us today or contact us online to schedule a free consultation.