The COVID-19 pandemic has wrought a previously unfathomable level of casualties and economic disruption in the United States and worldwide in just a few short weeks. Since mid-March, 16.9 million Americans have filed jobless claims, and one out of every 10 U.S. workers who had employment prior to the pandemic is now jobless.  Many people with disabilities who were previously employed are now suddenly out of work and faced with the dilemma of whether to apply for unemployment benefits, disability benefits, or both. Physician and governmental office closures present additional logistical challenges for those seeking completion of paperwork.  The following is a practical guide to these and other considerations during this time.

Disability Benefits for the Newly Unemployed

Many people may who find themselves newly unemployed may have existing health conditions that render them eligible for disability benefits.  The Americans with Disabilities Act protects the right of people with disabilities to work, provided they can perform the material duties of the job with or without reasonable accommodations.  Pursuant to that law, those with blindness, mobility issues, and other conditions limiting their ability to work have maintained gainful employment thanks to accommodations they negotiated with their employers.  As employers are forced to close due to shelter-in-place orders, economic conditions, or a combination of the two, previously accommodated employees are not guaranteed to find jobs offering comparable accommodations, especially in a tight job market.

Some employees may automatically qualify for disability benefits from the Social Security Administration if they meet or equal one of the conditions in the Social Security Listing of Impairments. Examples of listing-level impairments include statutory blindness, certain amputations, and cancer.  Many of the conditions in the Listing of Impairments are so severe that they would preclude employment even with accommodations.  Nonetheless, if you think you may qualify for a listing-level impairment, it will greatly improve your chances of being awarded Social Security disability benefits, particularly if you are young.  Claimants under age 50 who do not meet or equal a listing must, in most cases, demonstrate the inability to perform even unskilled sedentary work to qualify for disability benefits.

If your employer offered group disability insurance, you may be eligible for private short-term and/or long-term disability benefits, provided you were actively at work at the time the disability arose, and your disability is not subject to a pre-existing condition exclusion.  The advantage of private disability insurance is it typically insures the inability of the employee to perform his or her own occupation, at least for a period of time, whereas the Social Security Administration utilizes a more stringent “any occupation” standard.  Also, the approval process for private disability benefits is much faster than for Social Security disability benefits.

Some disability plan administrators may challenge an application for disability benefits absent some evidence that the underlying medical condition has worsened immediately prior to the application, but courts have been reluctant to impose such a requirement, observing that: “A desperate person might force himself to work despite an illness that everyone agreed was totally disabling. [. . .]Yet even a desperate person might not be able to maintain the necessary level of effort indefinitely.”  Hawkins v. First Union Corp. Long-Term Disability Plan, 326 F.3d 914, 918 (7th Cir. 2003) (internal citations omitted).

Additionally, disability plan administrators may not consider workplace accommodations in rendering a disability determination unless the accommodation was actually offered and remains available to the employee. See Ross v. Indiana State Teacher’s Ass’n Ins. Tr., 159 F.3d 1001, 1011 (7th Cir. 1998) (affirming denial of disability benefits where employer offered accommodations but employee declined them); cf. Saffle v. Sierra Pac. Power Co. Bargaining Unit Long Term Disability Income Plan, 85 F.3d 455, 460 (9th Cir. 1996) (overturning denial of disability benefits where ERISA plan administrator relied on hypothetical accommodations that were not offered to the employee).

Applying for disability benefits can be a challenge right now due to office closures. The Social Security Administration has closed its local offices but continues to accept applications for disability benefits over the phone and online. To apply, call 1-800-772-1213 or visit  To apply for short-term or long-term disability benefits, request an application from your employer and/or disability plan administrator. Some physician’s offices are closed or refusing to complete disability paperwork at this time. If that occurs, explain the situation to your employer and/or plan administrator request that the disability payments be released on an “reservation of rights” basis while the application is completed.

Beware of Unemployment and Company Buyouts

For the newly unemployed, the temptation to apply for unemployment benefits is strong, but doing so can present problems for those pursuing disability benefits.  State unemployment agencies require that applicants certify on a weekly basis that they are ready, willing and able to work, and most require the applicant to disclose if they have applied for Social Security disability insurance benefits. An untruthful statement to a state unemployment agency can result in an obligation to repay the unemployment benefits or, worse, a fraud investigation.

Disclosing to an unemployment agency that one has applied for Social Security disability benefits usually triggers and automatic denial or investigation.  It is possible to prevail in persuading the state unemployment agency to release unemployment benefits notwithstanding a Social Security application if the employment one seeks is part-time and/or pays less than $1,260/month (the Social Security threshold for substantial gainful activity in 2020).

Interestingly, the Social Security Administration has taken the position that it’s not necessarily inconsistent to apply for both Social Security disability and unemployment benefits.  Rather, “The receipt of unemployment benefits is only one of many factors that must be considered in determining whether the claimant is disabled.”  See20 CFR 404.l512(b) and 416.912(b); see alsoMemoranda of Chief ALJ Frank Cristaudo, dated November 15, 2006 Ref. No. 07-11; and August 9, 2010 Ref. No. 10-1258, available at Practically speaking, though, it’s best to refrain from seeking unemployment and disability benefits simultaneously if it can be avoided.

Company buyouts and voluntary separation plans can also present a trap for the unwary.  Most severance packages require employees to sign a broad release of their rights under company employee benefit plans, including disability and health plans.  Moreover, the severance payment can be an offset that reduces the amount of short-term or long-term disability benefits owed under the company’s disability plan, resulting in a loss of rights without much to show for it.  If you are considering accepting a buyout offer and are thinking of applying for disability, it’s best to discuss your options with an experienced attorney like the ones at DeBofsky Law


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