Opinion ID: 3013560
Heading Depth: 2
Heading Rank: 2

Heading: Applicability of the WEP

Text: The parties agree that Fliegler established 29 years of covered employment. The only dispute is whether he qualified for a year of covered employment in either 1973 or 1996. If so, his RIB would be fully exempt from the W EP offset. See 42 U.S.C. § 415(a)(7)(D); 20 C.F.R. § 404.213(e)(5). We will consider the two disputed years in turn.
In order for 1973 to qualify as a year of covered employment for WEP purposes, Fliegler was required to show a minimum of $2700 in covered earnings. See 20 C.F.R. § 404, Subpt. C, App. IV. Fliegler admits that he earned only $1716 from covered selfemployment in 1973. He cannot, therefore, count 1973 as a year of covered employment.1 1 The District Court should not have addressed Flieger’s arguments concerning quarters of coverage given that the only relevant figure for purposes of applying the WEP is the number of years of coverage. See 20 C.F.R. § 404.213(d). Quarters of coverage are 3
With respect to 1996, the question is whether the $465 paid to Fliegler by the Woolworth Corp. on January 6, 1997 should be credited as part of his wages for 1996. If the answer is yes, the parties agree that 1996 qualifies as a year of covered employment. As the Commissioner noted, the definition of “wages” that Fliegler proposes is not relevant here. By its own terms, the provision Fliegler cites, 42 U.S.C. § 403(f)(5)(A), applies only in the narrow context of calculating deductions for work under subsection (b).2 There is no reason to conclude that Congress intended the § 403(f) definition of wages to apply to any other interpretive issues arising under the SSA, particularly because the SSA includes a general definition of the term “wages.” See 42 U.S.C. § 409. Unfortunately, § 409 fails to address the question of whether an employee’s wages should be credited to the year in which they accrue or to the year in which they are paid. Corresponding regulations, however, establish that “[w]ages are received by an employee at the time they are [actually or constructively] paid by the employer to the employee.” 20 C.F.R. § 404.1042. This regulation, which serves to fill a gap in the statutory definition of wages, does not appear to be an unreasonable construction of § 409, and is counted in determining an individual’s insured status under the Social Security program. See 20 C.F.R. § 404, Subpt. B (“Insured Status and Quarters of Coverage”). Fliegler’s insured status is not in dispute. 2 Specifically, § 403(b) establishes a deduction from an individual’s benefits when that individual’s earnings in a given month exceed a certain amount. 4 therefore entitled to Chevron deference.3 See Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837 (1984). Fliegler does not dispute the fact that he was not actually paid the $465 in 1996. Instead, his position is that he was constructively paid in 1996. Under the rule established in § 404.1042(b), constructive payment occurs when wages are “credited to the account of, or set aside for, an employee so that they may be drawn upon by the employee at any time although not then actually received.” Viewing the entire record, there was substantial evidence to support the Commissioner’s factual determination that Woolworth did not maintain a policy permitting employees to draw upon their wages prior to receiving their paychecks or that Fliegler’s wages had been set aside for him. For this reason, Fliegler’s reliance on LaBonne is misguided, see LaBonne v. Heckler, 580 F. Supp. 558, 560-561 (D. Minn. 1984) (“[W]ages would have been paid to LaBonne earlier [than the date he received his paycheck] had he so requested.”), and Fliegler cannot establish constructive payment. 3 Both parties, as well as the District Court, cite to the definition of “earnings” found at 20 C.F.R. § 404.429. Subsection (a) of that regulation, however, makes clear that its application is limited to Subpart E of § 404, which is entitled “Deductions; Reductions; and Nonpayments of Benefits.” The regulation implementing the WEP, 20 C.F.R. § 404.213, is located in Subpart C of § 404, and therefore it unclear whether § 404.429 is even relevant to this case. This issue need not be addressed, however, because § 404.429(c) expressly adopts the definition of wages found in Subpart K, which includes § 404.1042. 5