Can I Collect Unemployment If Terminated While On Disability?

A disability that prevents you from doing the activities required to work may allow you to qualify for disability benefits. Whether the benefits are paid through short- or long-term disability insurance policies or through the Social Security Administration and its Supplemental Security Income or Social Security Disability Insurance programs, they give you financial assistance when it’s needed.

One thing that private disability insurance, state disability benefit programs, or the Social Security Administration cannot do is protect from being terminated while on disability. You could explore options about the rights you may have through state and federal programs, including the Family Medical Leave Act and the Americans with Disabilities Act, when an employer fires you while on disability.

An option that you may be considering is filing for unemployment if terminated while on disability. Let’s take a look at why unemployment benefits may not be an available option, and how applying for them may create additional problems if you are not aware of how unemployment and disability programs work. As you continue reading and learning, keep in mind that a disability advocate at London Disability is an outstanding source for advice and representation in all matters related to disability benefits.

Unemployment benefits and the ability to work

Each state has its own unemployment benefits laws, but one consistent element in all of them is a requirement that a person applying for benefits must be capable of working and actively seeking employment. Claiming to be disabled and unable to work in order to qualify for disability benefits is inconsistent with certifying to state unemployment officials that you are ready, willing, and capable of working.

If you lose your job while collecting short-term disability benefits through a private insurance plan or temporary disability payments through a state-administered plan, there is nothing to prevent you from applying for unemployment benefits once your doctor approves a return to work activity. People collecting long-term disability benefits through private insurance or employer-sponsored plans find it difficult to certify they are capable of working for purposes of unemployment without it conflicting with their disability benefits eligibility.

Working while collecting disability benefits

There are situations that allow you to work while collecting disability benefits or unemployment if terminated from your job. Short- and long-term disability plans through an employer or through an insurance policy that you purchase have terms and conditions that must be met for you to collect benefits.

Your plan or insurance policy may require certification that a person cannot do the specific type of work they were doing at the onset of the disability. That type of plan or policy may not prevent you from doing other types of work while continuing to collect disability benefits. Whether it would also allow you to receive unemployment benefits depends on the laws in your state as far as a claimant’s availability to work.

Other disability plans and policies only pay benefits to workers who cannot do work activities of any kind. If you have such a policy or plan, it would probably prevent you from collecting unemployment benefits because doing so requires that you be capable of working, which conflicts with the conditions of your disability plan or policy.

Working while collecting Social Security disability benefits

If you receive Social Security Disability Insurance benefits, the Social Security Administration actually encourages beneficiaries to test their ability to work without the earnings affecting program eligibility. As long as you report what you earn, you may work for up to nine months without it affecting your disability benefits.

The nine months of a trial work period can be used over a 60-month period. Any month that you earn more than $1,050 counts as a trial work month. You may earn as much as you can without it affecting eligibility for SSDI.

At the conclusion of the trial work period, you have the option to extend it for an additional 36 months. However, during this extended period of eligibility in 2023, you continue to receive benefits as long as you do not earn more than $1,470 during a month or $2,460 if you receive benefits because of blindness. If you do exceed these amounts, then you are engaging in substantial gainful activity and not eligible for benefits.

If your SSDI benefits stop because of your earnings during an extended period of eligibility, you may request reinstatement without having to file a new application for benefits. Expedited reinstatement is only available for five years.

Get Help With Disability Benefits From A Disability Advocate

The Social Security Administration has special medical-vocational allowance rules it applies to applicants who are over 50 years old that may allow them to receive disability benefits even though you are able to work. Learn more about how this may affect your claim and your ability to receive unemployment benefits during a free consultation with a disability advocate at London Disability. Contact us today to schedule a consultation.