Receiving Social Security Disability & Unemployment Compensation at the Same Time – No Easy Answer

There appears to be a conflict between Social Security Disability and Unemployment Compensation. In order to get Social Security Disability, you have to claim you are “disabled” for any work. However, to obtain Unemployment Compensation you have to claim you are “able and available” for work.

The November 15, 2006 Memorandum from Chief Judge Frank Cristaudo.

The Chief Judge said, “… the receipt of unemployment insurance benefits does not preclude the receipt of Social Security disability benefits. The receipt of unemployment benefits is only one of many factors that must be considered in determining whether a claimant is disabled…. “Therefore, it is SSA’s position that individuals need not choose between applying for unemployment insurance and SS disability benefits. However, application for unemployment benefits is evidence that the ALJ must consider together with all of the medical and other evidence.

What about the claimant who meets SSA’s definition for disability?

Some sharp Social Security practitioners have argued a person who is over 50 who had a past work background of manual labor (which the person can no longer perform) is “disabled” under SSDI Rules if he or she is now limited to sedentary work. Thus, this type of person could also qualify for Unemployment Compensation since he or she could still work.

What about the claimant who is limited to part-time work?

A person who is limited to part time work “is ready and willing to work,” but cannot work full-time and thus could theoretically qualify for Social Security Disability. If you cannot do full time work, then you can be found disabled under SS Rules (a person will be found disabled if he or she cannot perform sustained activity 8 hours per day, 5 days a week – Social Security Ruling 96-8p). Since he or she could look for part-time work, the person may be able to also qualify for UC.

Each State has its own eligibility rules for receipt of unemployment compensation.

Unlike SS, each State administers a separate unemployment insurance program within guidelines set by Federal law. Unemployment benefits are usually for people who have lost their job through no fault of their own under State law. So each state maintains its own criteria for the receipt of Unemployment Compensation. Some states were reducing their UC if the claimant received SS Disability. The claimant has to check the rules in his or her state. For example, the state of Virginia will reduce the claimant’s UC up to 50% due to receipt of SS Disability benefits as stated in Virginia Code 60.2-604.

The inconsistency in saying I am “fit and able to work” to the Unemployment agency and saying “I am disabled” to Social Security.

Many Social Security Judges that I appear in front of will automatically disqualify a claimant who has been on Unemployment Compensation. They will assert the claimants who are receiving unemployment compensation are simply “not credible” when they also apply for disability. These judges may simply be misinformed in light of the above memo by the Chief Social Security Judge.

Summary

In light of the above one can safely say the following: (1) Social Security should not prohibit you from filing for disability benefits just because you receive unemployment compensation; (2) a Social Judge is not supposed to deny your claim based “solely” on the fact you receive unemployment compensation; (3) a Social Security Judge may use your receipt of unemployment compensation as one of the factors in denying your claim; and (4) your Unemployment Compensation agency in your state may reduce your unemployment benefits if you receive Social Security Disability benefits.