Why Are Workers’ Compensation Benefits Better Than Disability Benefits?
When you’ve gotten hurt on the job, the primary concern is your health. But there are other crucial considerations as well. What about lost wages? Will you be able to get your job back? How will your family support itself without your income? You must address all these questions as soon as possible.
Fortunately, if you get hurt on the job in Pennsylvania, you may be eligible for a variety of benefits, including:
- Workers’ compensation.
- Unemployment compensation.
- Short and long-term disability.
- Sickness or accident benefits.
- Social Security Disability Insurance benefits (SSDI) if the injury is serious and you meet certain Social Security Administration (SSA) criteria.
There is a small caveat in all this positive news — which benefits you accept can affect payouts from your other benefits. For instance, you can be eligible for both workers’ comp and SSDI, but there are limits on the amount of money you can receive if you decide to apply for both benefits.
The Difference Between Workers’ Compensation and Disability Benefits Like Short-Term/Long-Term Disability and SSDI
What’s the difference between workers’ compensation and disability benefits?
Workers’ compensation benefits are available to you if you are injured on the job. It covers lost wages and medical bills. All employers in PA are required to carry workers’ comp to provide for injured employees. While these are government required benefits, your employer makes all the payments through their insurance company.
You can get laid off or fired while you are receiving workers’ compensation benefits, but your employer cannot fire you because you have applied for those benefits. That is illegal, and you may file a lawsuit if you believe this is the case.
An employer can dismiss you, however, based on past performance, if they had planned a layoff before you were injured or many other causes. This situation is particularly true if you are employed at-will, which means your employer can release you anytime, for any reason. On the other hand, it also means you have the right to leave the job anytime for any reason. At-will often makes it easier for an employer to find an excuse to release you while you are on workers’ comp.
However, if you believe you have been laid off or fired because you have filed a workers’ compensation claim and not for the explanation your employer gave you, consult a lawyer immediately.
Regardless of the reason, if you get laid off or fired while off of work or working light duty due to your work injury, you will continue to receive workers’ compensation benefits until you are healthy again, or until your employer can prove that you are fit enough to return to a job.
You do not have to be injured at a specific job to be eligible for SSDI. You may be eligible for SSDI if you have been injured on the job, off the job or a combination of the two. For instance, if you work in a chemical factory and are overwhelmed by fumes one day and return home and fall off a ladder while changing a light bulb because you still feel dizzy, the injury can qualify you for SSDI benefits if it results in a disability.
You must prove, however, you are disabled to the point you can no longer do any work you have done for any employer over the past 15 years. You must also show that this disability will prevent you from reasonably performing any other form of work. You will continue to receive SSDI benefits until you are no longer disabled, or until you reach your full retirement age when your disability benefits switch to retirement benefits.
When comparing short-term disability, long-term disability and workers’ comp, you will see that the disability benefits:
- Typically do not cover workplace injuries.
- typically pay less in wage loss benefits than workers’ compensation.
- Do not cover medical bills.
- Have a limited duration.
When you’ve been injured on or off the job, it is critical to know the difference between workers’ compensation and disability benefits like short-term/long-term disability and SSDI to choose what is best for you and your family.
Can I Receive Both Workers’ Comp and SSDI Benefits at The Same Time?
Yes. If you suffered an injury on the job that leaves you permanently disabled, you could receive both workers’ comp and SSDI, but only up to 80 percent of the total the SSA estimates your current wage to be. If the combined benefits from workers’ comp and SSDI add up to more than that 80 percent total, your SSDI benefits will be reduced until you reach the 80 percent threshold.
What Are the Best Benefits?
When you are injured, your employer might push for you to apply for state disability benefits or even for unemployment insurance to shift the costs of your injury to the government. Remember, your employer is thinking about what will be best for him or her, not for you.
In most cases, if you are directly injured on the job, workers’ compensation benefits are your best choice. Always apply for workers’ compensation first, even if you are thinking about applying for other benefits as well.
Compare workers’ compensation and other disability benefits to understand the advantages of workers’ comp benefits, like:
- You do not pay any taxes on workers’ compensation benefits, while you do pay taxes on short-term/long-term disability, sickness and accident, SSDI benefits or unemployment compensation benefits if you apply for those.
- You will likely receive more overall and financial benefits from workers’ compensation than other benefits.
- Workers’ compensation is typically available for a longer period of time than other benefits, especially short-term disability benefits and unemployment compensation benefits, which are usually limited to a maximum of 26 weeks.
- If you return to work before you are completely healthy and your employer puts you in a job with a lower pay rate, you’ll continue to earn workers’ compensation benefits at a partial rate. Other disability benefits, including SSDI, may not provide for extra income to make up the difference.
- Workers’ compensation covers all appropriate medical expenses with no limitations on the final amount and no deductibles for you. Even personal health care plans may not cover you as well as workers’ compensation.
What Happens If My Employer Denies Me Workers’ Compensation Benefits?
If your employer denies your initial claim, you are still eligible to apply for other benefits. Applying for those benefits does not prevent you from filing a workers’ compensation claim. Make sure you attach your employer’s Notice of Denial form when you file your claim.
Some of the benefits for which you can apply to help pay your bills after your employer has denied or delayed your workers’ compensation claim include:
- Unemployment Compensation benefits.
- Short-Term/Long-Term Disability benefits (assuming you have a policy).
- SSDI benefits.
- Supplemental Security Income (SSI) benefits, which take effect if you meet certain requirements.
Remember, you must meet specific criteria for SSDI and SSI, and both have limits on payouts. But if you meet the criteria, these benefits provide a good way to pay your bills until your workers’ compensation claim gets adjudicated.
What If I Decide to Accept a Settlement?
Another good reason to apply for workers’ comp benefits is that you can negotiate a settlement if you wish.
Sometimes your employer will offer you a lump-sum settlement, in which you agree to give up certain rights in exchange for a one-time payment. You may also negotiate a structured settlement with your employer that guarantees you smaller payments over a period of agreed-upon time — five years, ten years, etc.
There is nothing wrong with accepting a settlement if you believe it works to your benefit. It is important to know, however, that many lump-sum or secured-settlement agreements require you to relinquish all further claims for medical payments or lost wages. If you have an injury that doesn’t appear in its complete form until after you have signed a settlement agreement, you cannot expect your employer’s insurance company to pay those medical costs.
If you think you will need medical treatment over a period of several years after your injury, it is probably not in your best interest to accept a settlement.
A further concern is that some states will not allow settlements until your workers’ comp claim has reached a certain stage, which may be one reason your employer does not offer you a potential settlement in the early stages of a workers’ compensation claim. In other states, settlements that concern medical benefits are not allowed. Employers must continue to pay medical benefits in these states, even if there is a lump-sum agreement on other matters.
If you are considering accepting or negotiating a lump-sum agreement with your employer, do not do so until you have talked to a workers’ compensation lawyer. Employers can sometimes slip things into agreements you may overlook, which an experienced lawyer will catch.
Why Does a Structured Settlement Make Sense If I Am Receiving Both Workers’ Comp and SSDI?
Remember, if you are receiving both workers’ compensation and SSDI for an on-the-job injury that has left you seriously disabled, the SSA may offset the amount of money you are receiving from workers’ compensation. The current total amount is 80 percent of what the SSA estimates as your average current earnings.
While accepting a lump-sum agreement may provide you with a sizable amount of cash, it could also prevent you from receiving any SSDI benefits for several years if the total sum is more than the 80 percent figure. However, a structured settlement that spreads out the payout of any agreement you reach with your employer reduces the offset from the SSA. In some cases, it can eliminate it entirely.
It works this way: A 50-year-old man accepts a $20,000 lump-sum payout from workers’ compensation. Actuarial tables estimate he may live another 30 years. The SSA divides that $20,000 by 360, or the number of months in 30 years. This figure is then used to estimate the monthly offset, which in this case is $550 a month.
If that 50-year-old man was receiving $1,050 a month in Social Security, that means he is receiving $1,600 a month in total benefits. If he was earning less than $2,000 a month on his job — $1,600 divided by $2,000 equals 80 percent — some of his Social Security benefits would be offset. So if his monthly wage before he was hurt was $1,800 a month, it makes sense for him to negotiate a structured lump-sum payment where he would only receive a regular payout that would keep him within the 80 percent figure.
Again, before you talk with your employer or his or her insurance company about any lump-sum agreement, or sign any agreement, make sure you first consult a workers’ comp lawyer. They have a lot of experience in negotiating structured settlements and will work with you to make sure you remain within the 80 percent figure if you are also receiving SSDI benefits.
Should I Hire a Lawyer to Help Me With Workers’ Compensation Claims?
Yes. Filing a workers’ compensation claim involves many different factors. A workers’ comp lawyer can help you navigate your way through the many different benefits available to you and advise you on how to apply for the right benefits at the right time.
If you decide to take a lump-sum agreement from your employer, a workers’ comp lawyer will make sure the agreement does not just benefit your employer but ensures you receive the benefits to which you are entitled because of your injury.
A workers’ compensation lawyer also makes sense because if you’ve just been hurt, you may not be in the best place to negotiate an agreement or to remember to file your workers’ compensation claim forms before the three-year statute of limitations expires. A lawyer will be your best ally in ensuring you get all the benefits to which you are entitled.
Let KBG Injury Law Help You With a Workers’ Comp Claim
KBG’s team of experienced and knowledgeable lawyers can advise you on which benefits would work best for you, help you with all the necessary paperwork and file a lawsuit on your behalf if you’ve been wrongly terminated. We want to make sure you are receiving the results you deserve when you apply for workers’ compensation.
At KBG Injury Law, we see you not just as another client, but as someone who needs our help and understanding. We strive to treat each client individually and give them the attention they deserve. We understand the financial and emotional toll an injury suffered on the job can take on you and your loved ones.
We invite you to take a free consultation where we can talk about your situation and determine if there are ways we can help you. You can reach us 24 hours a day at our toll-free line, 800-509-1011, or you can visit our website and tell us about your situation.