HHS Settlement and Claims Process for Payment of 2015 Retroactive Transportation Subsidy Increases

Gavel on a stack of moneyI am very pleased to report that NTEU has reached an agreement with the Department of Health and Human Services (HHS) to settle a national grievance that was filed after HHS refused to pay retroactive transit subsidies to bargaining unit employees. Pursuant to the settlement, retroactive transit subsidies will be paid to eligible HHS employees for the period January 1, 2015, through December 31, 2015. The settlement covers current, former, and retired employees who participated in the HHS Transshare Program at any time during the above-referenced time period.

Dallas Area Rapid Transit Light RailAn eligible employee is a Transshare participant who received the maximum non-taxable transit subsidy that was in effect at the time in any given month from January 1, 2015, through December 31, 2015, but who spent more than the maximum subsidy for that month on public transit commuting costs. For example, if an employee received a public transportation subsidy of $130 for January 2015, and certifies his/her actual public transportation commuting cost in that month was $250, the employee will be entitled to a retroactive payment of $120 for January 2015.

This settlement is excellent news for our employees. On December 18, 2015, Congress passed the Consolidated Appropriations Act of 2016, which amended the law governing qualified transportation fringe benefits for 2016, retroactive to January 1, 2015. Previously, enacted provisions providing such parity expired on December 31, 2014, resulting in tax-free parking subsidies of up to $250 per month, but only $130 per month for the use of mass transit. The Consolidated Appropriations Act of 2016 increased the monthly transit benefit exclusion from $130 per participating employee to $255 for 2016 and made parity between transit and parking benefits permanent. In addition, the law increased the monthly transit benefit from $130 per participating employee to $250 for 2015, retroactive to January 1, 2015.

This is NTEU CountryNTEU filed a national grievance in May 2016 against HHS for its refusal to pay retroactive transit subsidy increases to eligible bargaining unit employees pursuant to the Consolidated Appropriations Act of 2016 and Article 53 of the parties’ Consolidated Collective Bargaining Agreement (CBA). In the grievance, NTEU alleged HHS violated Article 53 by refusing to pay employees retroactive transit subsidies up to the new non-taxable amount of $250 for 2015 established under the Consolidated Appropriations Act of 2016. Section 2 of Article 53, which states “[t]he Employer will offer a monthly benefit to employees equal to their actual monthly commuting costs, but not to exceed the maximum amount authorized by applicable laws, Executive Orders and regulations governing public transportation benefits for federal employees” was specifically negotiated by NTEU to address changes in the law that could benefit employees.

The settlement agreement also establishes a claims process that will be followed to make retroactive transit subsidy reimbursements to eligible bargaining unit employees. Highlights of the settlement agreement and claims process are:

  • Eligible employees are all HHS bargaining unit employees (including former and retired employees) who participated in the HHS Transshare Program at any time during calendar year (CY) 2015 and to whom HHS provided the maximum subsidy in effect at that time in any given month, but who spent more than the maximum subsidy for that month.
  • For 2015, the amount of retroactive transit subsidies which eligible employees are entitled to the actual public transit commuting costs in excess of $130 but not to exceed $250 for each month.
  • HHS has identified all NTEU bargaining unit employees to whom it provided the maximum subsidy in effect at the time during any month in 2015, and whose actual public transit commuting costs were greater than the maximum subsidy in effect at that time. HHS will notify all such employees via e-mail of their eligibility within 30 days of the date of this settlement agreement.
  • The eligibility notice will be followed by a letter to each eligible employee identifying the amount HHS has identified they are owed for each month, exclusive of interest. Employees will be required to respond to the letter within 30 days of receipt indicating whether they agree with the amount, or disagree. It is imperative for eligible employees to respond within the 30-day time frame. If you fail to do so, your entitlement to retroactive transit subsidies will be waived.
  • If an employee disagrees with the amount identified for any given month, they must identify the amount they assert is due for that month. All letters (disputed and agreed) must be signed by the employee and returned to HHS within 30 days of receipt.
  • If an employee disagrees with the amount identified by HHS, the claims process only requires employees to self-certify their actual public transportation commuting costs separately for each month they are claiming a retroactive transit benefit during the relevant time periods. Receipts will not be required. Payment of the original amount, if any, identified by HHS will not be delayed while challenges to the disputed amounts are investigated.
  • Any employee who does not receive a letter notifying they are eligible to receive a retroactive transit subsidy payment may challenge that decision within 105 days of the date of the Settlement Agreement. Challenges must be sent to:

Tim Brown
Deputy Director, Administrative Operations Portfolio
Program Support Center
U.S. Department of Health and Human Services
7700 Wisconsin Avenue, Suite 7208
Bethesda, MD  20857

  • Payments will be made as soon as practicable.

HHS has taken the position that retroactive transit subsidy payments are taxable, and it will withhold taxes on claims paid under this process. However, the settlement agreement specifically reserves the right for any claimant to individually challenge the taxability of their payment, should they choose to do so.

The most interesting man in the world, "I don't work for FDA. But if I did, I would join NTEU."Lastly, I cannot emphasize enough how this settlement agreement presents an excellent opportunity for us to strengthen our chapter and NTEU. I encourage you to spread the word to nonmembers in the coming days and weeks on NTEU’s hard work on this and other cases. NTEU’s efforts on this grievance have resulted in bargaining unit employees being able to claim hundreds of dollars in back pay for transit costs they paid out of pocket. These are reimbursements that employees are only receiving as a result of the work done by NTEU. We should ensure that non-members are aware of why they are receiving this money and that future efforts to represent employees at HHS will only be strengthened by becoming a member of NTEU.

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