SSR 72-46: SECTION 205(p) (42 U.S.C. 405(p)). -- EMPLOYER-EMPLOYEE RELATIONSHIP -- FEDERAL SERVICE -- EMPLOYMENT DETERMINATION MADE BY FEDERAL AGENCY -- UNITED STATES POSTAL SERVICE

20 CFR 404.1013

SSR 72-46

Held, United States Postal Service, which replaced former Post Office Department, is a "Federal agency or instrumentally." Accordingly, the head of such 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, for purposes of section 205(p) of Social Security Act.

Section 205 of the Social Security Act (42 U.S.C. 405) provides in pertinent part that:

(a) The Secretary shall have full power and authority to make rules and regulations and to establish procedures, not inconsistent with the provisions of this title, which are necessary or appropriate to carry out such provisions, and shall adopt reasonable and proper rules and regulations in regulate and provide for the nature and extent of the proofs and evidence and the method of taking and furnishing the same in order to establish the right to benefits hereunder.

(b) The Secretary is directed to make findings of fact, and decisions as to the rights of any individual applying for a payment under this title. * * *

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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:

(1) With respect to service included as employment under section 210 which is performed in the employ of the United States or in the employ of any instrumentally which is wholly owned by the United States, * * * the Secretary shall not make determinations as to whether an individual has performed such service, the periods of such service, the amounts of remuneration for such service which constitute wages under the provisions of section 209, or the periods in which or for which such wages were paid, but shall accept the determinations with respect thereto of the head of the appropriate Federal agency or instrumentality [or his agent]. Such determinations shall be final and conclusive.

(2) The head of any such agency or instrumentality is authorized and directed, upon written request of the Secretary, to make certification to him with respect to any matter determinable for the Secretary by such head or his agents under this subsection, which the Secretary finds necessary in administering this title. [Emphasis added.]

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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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