If you suffer a disabling injury or illness and are a government employee or participate in a defined benefit pension plan, such as through a union, you may be eligible for a disability retirement pension, as distinct from or in conjunction with disability insurance.  Disability pensions provide monthly payments to workers who are not yet eligible to retire with a full pension, but who suffer from a physical or mental impairment that would permanently prevent them from working.  Disability retirement pensions are available to employees regardless of whether they are injured on the job, though some employers offer enhanced benefits for work-related disabilities (sometimes called “duty” disability pensions).

Disability pensions can last for the rest of a person’s life, provided he or she remains disabled and continues to comply with the terms and conditions for receipt of ongoing disability benefits. Disability retirement will cease if you are deemed to no longer be disabled or, in some circumstances, if you return to work or engage in other activities inconsistent with disability.

Can you retire early if you have a disability?

If you are a participant in a pension plan that offers disability retirement benefits, and you suffer a career-ending illness or injury, you may be eligible for disability retirement.  Disability retirement differs from early retirement in that it typically provides an enhanced payment over the amount you would receive if you were to draw early retirement.  Some plans even allow you to continue to accrue pension credits towards your retirement while receiving disability retirement payments, resulting in an enhanced monthly retirement benefit when you reach retirement age.  The standard for qualifying for disability retirement benefits can be rigorous, however, making early retirement a potential fallback option if you are disabled and no longer able to work and also meet the age and service requirements for an early retirement pension.

Can you receive both early retirement and disability retirement?

Generally, you must choose between receiving early retirement and disability retirement.  An exception exists, however, in the case of Social Security benefits.  The SSA allows you to continue to pursue Social Security disability benefits even after applying for early retirement at age 62 or at a later age prior to normal retirement age (age 67 for anyone born in 1960 or later). If you are deemed disabled by the Social Security Administration and have already drawn Social Security early retirement, the SSA will retroactively pay you the difference between the early retirement benefits you received and the higher disability payment amount, and the SSA will upwardly adjust your retirement benefit prospectively.  Drawing Social Security early retirement can provide a crucial bridge for individuals over age 62 who have not yet received a Social Security disability determination.  It is important to continue to pursue the Social Security disability claim even after applying for Social Security early retirement, as failure to do so means your retirement benefit will remain permanently reduced as a result of drawing it early.

How do you qualify for disability retirement?

To qualify for disability retirement, you must first participate in a governmental or defined benefit pension plan that provides disability retirement benefits.  You must then comply with the proscribed procedure for applying for disability retirement benefits, usually found on the employer’s website, relevant statutory code, and/or pension plan document and summary plan description.  In addition to the application, you generally must submit a statement of support by your doctor.  Most employers will require you to submit to at least one additional medical examination performed by a doctor of the employer’s choosing; and you may be required to attend periodic examinations even after benefits are approved as a requirement to receive ongoing disability retirement benefits. Some employers will require that you submit proof of an award of Social Security disability benefits as a precondition to receiving disability retirement.

The timing of the application can be important.  For instance, the Federal Office of Personnel Management will not consider disability retirement applications submitted more than a year after the applicant ceased working.  In the case of the Chicago Public Schools, a teacher must apply for a duty disability pension within six months of the injury or six months of a worker’s compensation trial or settlement, or the right to apply for a duty disability pension is waived.  Thus, as soon as you are injured or fall ill, it’s a good idea to inquire about disability retirement lest you miss the window to apply.

If you have questions or concerns about the disability retirement application process, the experienced pension lawyers at DeBofsky Sherman Casciari Reynolds can help.

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