Tag Archives: unemployment compensation

Disability Claims and Unemployment Compensation

At first glance, a disability claim filed with the Social Security Administration and a claim for Unemployment Compensation benefits would seem to be contradictory. After all, when a person files for disability, the individual basically is stating that she is unable to work for health reasons. To file for Unemployment Compensation, that same person is saying that she is “able and available” to work. However, the current position of the Social Security Administration (SSA) is that these two claims can coexist, allowing one person to file for both benefits at the same time.

This policy is found in a memorandum, dated November 15, 2006, which was written by Frank Cristaudo when he was the Chief Administrative Law Judge for the Office of Disability Adjudication and Review (ODAR). He issued the policy to clarify an issue with which some of ODAR’s Administrative Law Judges continue to struggle, even after this directive. There may seem to be something inconsistent when a person collects Unemployment Compensation, reporting to Pennsylvania’s Department of Labor and Industry that they can work, while the same person tells a federal agency that he or she is entitled to benefits because a disability prevents work. However, the issue is not as simple – or inconsistent – as this would seem.

Disability, according to the definition of the Social Security Administration, does not mean that someone is not capable of doing any work. Basically, what disability means when an individual in terms of a claim for benefits filed with the SSA is that the person cannot perform work activities on a full-time basis, which is termed “substantial gainful activity.” This does not mean that this person is unable to do any work at all.

As for Unemployment Compensation in Pennsylvania and many other states, when a person is able and available for work, this includes part-time work and not necessarily a full-time job. In this situation, there are two definitions of work being used, and neither definition actually rules out the other one.

The memorandum does advise Administrative Law Judges that Unemployment Compensation and the work being sought to qualify of this benefit should be considered in determining whether a person is disabled, but it is only one of many factors. In part, the Chief Administrative Law Judge acknowledged the reality that disability determinations by the Social Security Administration generally involve a lengthy process that can force an individual to make the decision to apply for both benefits just to survive the financial hardships that can occur while awaiting a final decision regarding a disability claim.

In fact, one of the SSA’s own regulations directs individuals who apply for Supplemental Security Income (SSI) to apply for all benefits, which includes Unemployment Compensation, for which they could be eligible. To force a person to apply for this and then automatically deny the disability claim because the individual did what was required would lack logic, at the very least.

A final note for the moment involves how receiving Unemployment Compensation affects someone who is receiving SSI, which is a needs-based program (akin to federal welfare), versus someone who gets Social Security Disability (SSD), which is based on a person’s work record. The person who receives SSI and has received Unemployment Compensation will lose some of the SSI payments that would have been received because there is a deduction from the federal payment when there is additional income, such as Unemployment Compensation, available to the individual because this means that there is less need for the SSI, which is based on need.

However, SSD benefits are not tested against a person’s additional income or resources when determining monthly payments. Therefore, the level of Social Security Disability paid to the disabled individual will not be adjusted due to the receipt of Unemployment Compensation. Also, certain other types of income – for example, Worker’s Compensation – cause an offset that is deducted from SSD benefits because Pennsylvania that would require repayment of Worker’s Compensation benefits in this instance if the recipient later is found to have been disabled by the Social Security Administration during the period that the other income was received. Since eligibility for Unemployment Compensation is not based on injury or illness, it does not trigger an offset involving disability benefits.

As always, if there are questions or any need for clarification regarding what can seem to be a complicated system of rules and regulations, you can contact me about these issues.