The Impact of a Social Security Disability Award on New York Workers’ Compensation Benefits

Joseph Melchionne
Joseph Melchionne, Esq.

Social Security Disability Insurance (SSDI) provides protection for injured people who need to return to work without compromising

their rights to other federal and/or state benefits.  According to the Social Security Administration, someone is “disabled” if they are not able to work as the result of an illness or injury that will last for at least twelve (12) months.

SSDI Requirements.

In order to qualify for SSDI a person:

  • must be younger than 65 years of age,
  • must have worked in a job that is covered by Social Security, and
  • must have suffered from an illness or injury that meets the aforementioned Social Security definition of “disability.”

If all of the aforementioned criteria is met, Social Security will provide monthly cash benefits to individuals who are unable to return to work for at least one (1) year because of their impairment.

Social Security Disability and Workers’ Compensation.

A natural question that arises is: “Can an individual who is receiving SSDI still qualify for workers’ compensation benefits in New York?”  The answer is a little complicated. In brief, the amount of SSDI benefits an individual is entitled to may be reduced if that person is receiving workers’ compensation indemnity benefits for the same time period. The legal reason for this is because an injured worker’s total benefit amount received from all available sources cannot exceed eighty (80%) of his or her average earnings.

For instance, if an injured worker’s average weekly wage is $1,500.00 and he or she currently receives $844.29 a week in workers’ compensation indemnity benefits, than he or she cannot receive more than $355.71 in SSDI benefits because if they did their total disability benefit amount would exceed 80% of their average weekly earnings.IMGP0263

The reduction in SSDI benefit amount due to workers’ compensation benefits is called the workers’ compensation offset. According to Social Security law, a person’s Social Security benefit entitlements will be reduced before workers’ compensation benefits.  Once a person’s workers’ compensation benefits cease and no longer overlap SSDI benefits, then the injured person’s SSDI benefit amount may be increased to a higher amount.

An individual’s workers’ compensation offset will also cease if that person continues to receive workers’ compensation benefits when he or she reaches retirement age. When a person reaches retirement age, Social Security Retirement benefits are triggered and the workers’ compensation offset will no longer apply.

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Joseph Melchionne is an associate attorney at Lois LLC where he defends employers and carriers in New York workers’ compensation claims. Joseph can be reached directly at jmelchionne@loisllc.com or 201-880-7213.