Question 604: I've heard that my railroad might relocate my function to another area. Because of my seniority, I might be offered a buyout. I have a physical impairment that might qualify me for a disability annuity from Railroad Retirement. Would a buyout affect my eligibility for such an annuity? If I continue to work, would I be eligible for a disability annuity in the future?
Answer: It depends upon how the buyout payment is structured. If it's paid in a lump sum and none of the payment is allocated to Railroad Retirement service credits, there should be no effect on annuity payments under Railroad Retirement.
Remember, there is a 5-month waiting period before disability annuity payments begin. Usually, a rail worker goes on Railroad Sickness Benefits during the interval.
There are two different types of disability annuities under Railroad Retirement: "Occupational" and "Total & Permanent."
An Occupational Disability Annuity requires a worker to have a "Current Connection." If you ever work outside the railroad industry, you could lose your "Current Connection" after a couple of years of nonrailroad work.
A Total & Permanent Disability Annuity does not require a "Current Connection."