20 CFR 404.1013
Section 205 of the Social Security Act (42 U.S.C. 405) provides in pertinent part that:
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The Act further prescribes in section 205(p) special rules in the case of Federal service by certain individuals, as follows:
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A question has been raised as to whether, for purposes of determining the applicability of section 205(p) of the Act, the recently established United States Postal Service is an "agency or instrumentality" of the United States.
The Postal Reorganization Act (P.L. 91-375) revised 39 U.S.C. 101 ff. so as to abolish the Post Office Department and establish the United States Postal Service as "an independent establishment of the executive branch of the Government of the United States." 39 U.S.C. 201. The Service became operational on July 1, 1971.
The Postal Service has a number of general powers, including the power to sue and be sued in its official name, to acquire and hold property, to contract, to settle and compromise claims by and against it, and generally to conduct its own affairs. Its operations are directed by an 11-member Board of Governors appointed by the President with Senate approval. Each Governor is statutorily described as "an officer of the Government of the United States in the Postal Service." 39 U.S.C. 205(d).
In addition, there are statutory indications that employees of the Postal Service are employees of the U.S. Government. For example, the postal career service is part of the civil service; its employees continue to be covered by the civil service retirement system and by the Federal Employees' Compensation Act.
The following additional specific indications also serve to establish the identity and status of the Postal Service. Its total initial capital was provided by the Government, and its operating capital comes from a revolving fund in the U.S. Treasury; its obligations have the character of a "public debt;" it can exercise Government authority and priorities in the conduct of its official affairs; it is answerable to the Government with regard to its expenditures; and it is treated as an agency of the Government in administrative and judicial proceedings.
Accordingly, it is held that the U.S. Postal Service, which replaced the former Post Office Department, is a Federal agency or instrumentality. The head of the agency is authorized to make certifications as to matters determinable for the Secretary of health, Education, and Welfare; such as, whether an individual has performed services in employment, for what periods he worked, and the amount of wages received,f or purposes of section 205(p) of the Social Security Act.
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