When hurt workers can no longer work at their jobs, they may be able to take advantage of a number of benefit situations. The two most valuable are workers' compensation and Social Security Disability Insurance (SSDI). Some workers, if they structure their payments right, may be able to get both benefits simultaneously. Read on to find out more.
What Are the Differences?
Both workers' compensation and SSDI pay money to workers who are unable to perform the tasks of their former job due to a specific medical or mental condition. SSDI, however, is a government program whereas workers' compensation is an insurance program offered by employers and is overseen by a governing board in each state. Here are some more differences:
- Hurt workers are covered under workers' compensation immediately but SSDI recipients must work long enough and earn enough money to qualify.
- Hurt workers must show that their injury or illness is directly linked to their job but SSDI recipients don't have to prove that link.
- To be paid for SSDI, applicants must show that they have an affliction that will affect them for at least a year. Workers' comp recipients must usually show that their affliction will permanently affect their ability to work.
- Workers' comp recipients may receive a one-time payment for their permanent injury while SSDI will result in monthly benefit payments. Neither form of benefit should be expected to replace your former salary.
Workers' Comp Payments and SSDI
Unfortunately, SSDI monthly benefits are based on the recipient's income. If the income is over a certain level, they cannot get benefits. They can, however, still receive workers' comp payments in some cases. Take a look at two ways to accomplish the double-dip.
First, the hurt worker can have their lawyer negotiate for a large lump-sum payment. This money is meant to replace some of the income lost due to the permanent injury. After receiving the settlement, the hurt worker then applies for SSDI. Since SSDI doesn't consider funds in a bank account or the value of something like a house when evaluating applicants, they may still be approved for SSDI.
Then, the hurt worker's lawyer could negotiate for a structured payment that pays weekly or monthly payments rather than a single lump sum. When applying for SSDI, the workers' comp funds are considered income but not in the same way as other income. Instead, the SSDI payment is "offset" by the workers' comp payment so that the applicant's payment won't exceed 80% of the previous salary.
This issue can be very complicated, so speak to a workers' compensation lawyer about whether you can take advantage of both programs at the same time.