Can I apply for Disability while collecting Unemployment?

Applying for Disability while collecting Unemployment?

With the Coronavirus having a giant impact on the American and world economy, many new people are applying for unemployment. According to the Washington Post, already 3.3 new Americans filed for unemployment benefits last week.

With no end in sight, nobody is quite sure the ultimate impact the Coronavirus will have on job losses or the Unemployment numbers. This economic volatility has led to questions from current or perspective clients regarding whether they are actually able to apply for Social Security Disability benefits while receiving Unemployment at the same time. That question and further analysis will be discussed below.

In short, YES you can apply for Social Security Disability benefits while also receiving Unemployment.  Although there have been legislative proposals to ban the receipt of Unemployment while applying for Disability, none have been passed. (See H.R. 918 & S 499)

Although the short answer is YES, the long answer is that it can be problematic to receive Unemployment while applying for Disability. With Unemployment, you are telling the state government that you are ready, willing, and able to work on a full-time basis.With Disability, you are telling the federal government that you are unable to maintain full-time employment for a minimum of 12 months due to an impairment or combination of impairments.

At Administrative Hearings, the Administrative Law Judge will most likely ask you to explain the contradiction of receiving Unemployment while applying for Disability. Sometimes, the ALJ will require you to change your onset of Disability so you could not receive back benefits at the same time period you were collecting Unemployment. Occasionally, in some states, if you do receive back benefits for Disability, then you will have to pay back the Unemployment benefits.

There are some explanations that can be given for collecting Unemployment while applying for Disability. Financial hardship is the most common and, from a practical perspective, that is understandable but often is not enough of an explanation for an ALJ. Along the lines of the financial hardship is the fact that it can take years to get to a Disability Hearing (which comes after 2 denials at the lower levels) and therefore you had been determined not disabled already.  Other reasons I have heard given are that of wishful thinking in getting better or that wanting to work and giving it a try does not mean the work attempt would be successful. These are some of the general explanations I have heard claimants testify to at Hearings.

Legally, a claimant could receive Unemployment and be found eligible for Disability. This can occur through what are called the Grid Rules which apply to individuals age 50 and older. Generally speaking, if a claimant claims that they are applying for work which is less strenuous than they have performed in the past then they could be found Disabled while collecting Unemployment.

This topic is a discussion I have had hundreds of times with clients over the years and there are many things to consider when discussing this question. It is important to have a discussion with a Disability Attorney to fully understand the options you might have along with the ramifications of the choice made based upon your specific situation.  The attorney can provide valuable guidance during a time of uncertainty.