If you were hurt at work, an experienced ERISA disability attorney with knowledge of workers’ compensation claims can help you understand how workers’ compensation and disability benefits fit together. When someone is injured at work, one of their first thoughts is workers’ compensation. Will they get paid if they cannot work? Will their medical bills be covered? These questions matter. Yet many people do not realize that they may qualify for other benefits through work. These include short-term and long-term disability benefits (STD/LTD). Many employers offer both.
Short-term disability policies often deny a payout when an injury happens at work. Long-term disability policies usually can still pay. However, LTD policies often reduce the benefit by the amount you receive in workers’ compensation. STD covers an initial period of disability. After a one-week waiting period, you can usually collect STD benefits for three to six months. LTD benefits then take over if you have coverage.
Workers’ Compensation vs. ERISA Disability Benefits
State law usually governs workers’ compensation. The system has its own paperwork, deadlines, and procedures. It is an administrative law system, and workers’ compensation judges oversee disputes. An injured worker must prove that they are unable to perform their own preinjury job.
In comparison, STD and LTD benefits exist outside the scope of the workers’ compensation system. Federal law usually governs them under ERISA, though exceptions exist. Federal judges oversee most STD and LTD disputes. For STD claims, and often for the first 24 months of an LTD claim, you must prove that you cannot perform your own occupation. After that period, you must prove that you cannot perform any occupation you are reasonably qualified for. An ERISA disability attorney can guide you through each step.
How Fault and Eligibility Differ
Workers’ compensation is generally a no-fault system. An injured worker only needs to prove that the injury happened in the course and scope of employment. STD and LTD policies usually do not require an injury to happen in a certain way. They do, however, contain exclusions. Common exclusions involve injuries from self-harm and war.
How Benefit Amounts Are Calculated
The benefit calculations differ. Both rely on wages, but workers’ compensation caps the maximum amount you can receive. Those benefits usually arrive weekly. While STD benefits may be weekly, LTD benefits usually arrive monthly. The only cap on STD and LTD is the one written into your policy. No state or federal law caps STD or LTD benefits the way it caps workers’ compensation.
Workers’ compensation benefits are generally tax-free. They often include health insurance that covers treatment for the work injury. The taxability of LTD benefits depends on whether you paid premiums with pre-tax or post-tax dollars. STD and LTD benefits usually do not include health insurance. An employer may continue your health insurance after an STD or LTD approval, but that arrangement is generally separate from the policy documents.
When Workers’ Compensation and Disability Claims Conflict
The interplay between these systems can get complicated. What if an insurer denies your workers’ compensation benefits at first? Can you still collect short-term disability benefits? The answer depends on the language in your short-term disability policy. What if a work injury overlaps with an unrelated condition that also disables you? Sometimes the short-term disability insurer still pays the full amount. The long-term disability insurer may not offset your payments by your workers’ compensation benefits. In that situation, you may receive full payments from the workers’ compensation carrier and the disability providers at the same time.
Settlements add another layer. Many policies state that a lump-sum settlement for a related matter gets divided over 60 months. The insurer then offsets your long-term disability benefits each month for 60 months. The right language in your workers’ compensation settlement can reduce that overpayment significantly. A skilled ERISA disability attorney can help you negotiate that language before you sign.
Why an Individual Disability Policy Helps
For the strongest protection, consider buying an individual disability insurance policy on top of your group coverage. Individual policies often skip the offset provisions that group plans use. You also get to choose the terms you want. Group coverage rarely offers that flexibility. If health insurance later becomes a problem, an extra stream of income helps.
Talk to an ERISA Disability Attorney
These systems are complex, and they overlap in ways that surprise many injured workers. If a work injury affects you, consult a workers’ compensation attorney and an STD and LTD attorney. You deserve the maximum compensation the law allows, and attorneys who know both systems can help you reach it.
At The Garner Firm, our team includes an attorney who has worked with both workers’ compensation and Social Security Disability (SSD) claimants, alongside his work on STD and LTD claims. We do not handle workers’ compensation or SSD claims, but Zachary Lipschutz’s background lets us advise our STD and LTD clients with the full picture in mind. Contact The Garner Firm today with any questions about your ERISA disability claim.