Bipartisan bill introduced to end sequestration cuts to railroad unemployment benefits

WASHINGTON – U.S. Senators Rob Portman (R-Ohio) and Amy Klobuchar (D-Minn.) introduced S. 4860, the Railroad Employee Equality and Fairness Act or the REEF Act, which would end the sequester on the Railroad Retirement Board’s (RRB) Unemployment Insurance Account. Due to the Budget Control Act of 2011, and a subsequent sequestration order to implement mandated spending cuts, railroad unemployment benefits have been reduced by a set percentage that is subject to revision at the beginning of each fiscal year. Currently, the sequester, as it relates to the RRB, continues until fiscal year 2030. Without this legislation, it is expected that the sequestration will result in a 5.7 percent reduction in railroad unemployment benefits through fiscal year 2030.

Since most interstate railroad workers’ payroll taxes are diverted to the RRB, unemployed railroad workers are not eligible for federal unemployment insurance benefits, which was not subject to the sequester. This resulted in railroad workers taking a cut in expected benefits that the general public was not subject to. This is particularly concerning during the ongoing COVID-19 pandemic. In 2019, the RRB received 35,030 unemployment claims. As of September 2020, it has received 133,899 claims, nearly a fourfold increase.

“I’m proud to introduce this bipartisan legislation to ensure that unemployed railroad workers receive fair and equal unemployment benefits. This legislation would remove the harmful sequester that largely singled out railroad workers’ unemployment benefits during the ongoing COVID-19 pandemic. The impact of the sequester has meant these railroad workers have not received the full unemployment insurance benefits that are due to them. The COVID-19 pandemic has caused nearly five times as many Ohio railroad workers to lose their jobs through no fault of their own and I urge my colleagues to join me in ensuring they are eligible for the same full unemployment benefits as all Americans,” said Portman.

“Our workers are facing enormous challenges due to the coronavirus pandemic and railroad workers have been hit particularly hard,” Klobuchar said. “This legislation ensures railroad employees are eligible for the same benefits as other workers and will help them get through these trying times.”

S. 4860 was read twice before the Senate Oct. 26 and referred to the Committee on the Budget. No other actions have taken place.