Get Both Workers Compensation and Social Security Disability
If you’ve had an on-the-job injury and are eligible for workers compensation, you may be eligible to receive both workers comp and Social Security at the same time. Workers compensation and Social Security have different definitions of disability. Social Security usually requires you to be disabled, not just from the job you were in when you were injured, but also from other kinds of work. For a discussion of Social Security’s definition of disability, please see our article “Do I Have to Be Completely Incapacitated to Get Social Security Disability?”
Don’t Wait to Apply
If you think that you may meet Social Security’s disability definition and that you will be disabled for twelve months, then it is a good idea to apply for Social Security Disability right away. If you wait till your workers compensation runs out, you might be left with no income while your Social Security claim is pending. You might even lose back pay Social Security benefits, if you apply more than seventeen months after you become disabled.
Social Security Benefit Calculation with Workers Compensation
The amount of Social Security Disability benefits you receive may be reduced if you receive workers compensation for the same period for which you receive Social Security. This is because the law says your workers comp benefits and your Social Security Disability benefits—including benefits paid for your dependents—can not exceed eighty percent of your average earnings, as defined by Social Security. In some cases, a lump sum payout of workers compensation is prorated to a monthly amount and is considered to be overlapping with Social Security until the proration runs out.
For example, if your average earnings are $2,000.00, then eighty percent of your average earnings would be $1,600.00. If you are getting $1,300.00 from workers compensation, then the most you and your dependents could get from Social Security would be $300.00.This is true even if your unreduced Social Security is more than $300.00. This reduction, called workers compensation offset, will be applied to reduce your dependents Social Security benefits first, before reducing your benefit.
When Workers Compensation Offset Stops
Once your workers compensation benefits—whether temporary monthly benefits or a prorated lump sum—no longer overlap with Social Security, then your Social Security Disability benefits and your family’s Social Security dependents benefits will increase to your maximum amount.
Workers compensation offset will also stop if you are still receiving worker’s compensation when you reach your Social Security Normal Retirement Age. At that time, you will not longer get Social Security Disability because you will be switched to Social Security Retirement, and workers compensation offset will no longer apply. For information about becoming disabled while receiving reduced Social Security Retirement, see our article “Will My Benefits Increase Because I Became Disabled While Collecting Early Social Security Retirement Benefits?”