Can I Collect Unemployment While Waiting for Social Security Disability?

Filing for Social Security disability benefits while receiving unemployment benefits can be a tricky situation. The problem with filing for disability while collecting unemployment is that you are saying two different things.

Disability vs. Unemployment Claims

If you are filing for Social Security disability, you are stating that you have been unable to perform substantial work activity for twelve months, or that you anticipate that you'll be unable to perform substantial work activity for at least twelve months, due to a mental and/or physical impairment. But when filing for unemployment, you are stating you are ready and available to perform work should you be able to find a job that fits your work skills. (And some states require that you're ready and able to perform full-time work to be eligible to collect unemployment benefits.)

Collecting Disability and Unemployment Benefits at the Same Time

Whether you should try to collect unemployment and disability at the same time is a controversial issue in the disability field, with lawyers, non-lawyer advocates, Social Security claims examiners, and administrative law judges (ALJs) all having different opinions.

What Do Disability Lawyers Advise?

Many Social Security disability lawyers advise against collecting unemployment benefits when applying for Social Security disability, because ALJs who work for Social Security have been known to look askance at people applying for both benefits at the same time, or even deny the disability claims of those who are collecting unemployment benefits.

Other lawyers point out that there are situations where an older person could be legitimately entitled to disability benefits due to a medical-vocational allowance but be able to work. For instance, if a person is limited to sedentary work (that is, was given a sedentary RFC), but because of his age, past job skills, and education level, isn't expected to learn how to do a sedentary job, he should be approved for disability benefits. In that case, theoretically the individual could actually collect disability benefits but work a sedentary job (as long as he makes under the SGA limit or the SSI limits). (Although if Social Security sees that the individual is working, this could be used as evidence that the worker has the skills to work a sedentary job.) Similarly, an individual could apply for unemployment benefits if he says he is ready and willing to work a sedentary job. (Although, again, Social Security might use this information to say the worker has the skills to work a sedentary job and is not disabled.)

What Does the SSA Say?

Social Security's official stance is that receiving unemployment benefits does not prevent someone from receiving Social Security disability benefits, but that a disability claims examiner or ALJ can count the unemployment filing as one of the factors in considering whether an applicant is disabled. For instance, if a worker is collecting unemployment benefits and telling the state employment department that she has applied for certain jobs, the ALJ can take into account what those jobs were. If they were jobs requiring physical labor that the applicant claims she cannot do, Social Security can take that into account.

Consider the Risk

As a former Social Security claims representative, I informed all disability claimants who were receiving unemployment benefits, that the decision to file for disability was their choice but they needed to consider the potential pitfalls of taking unemployment benefits while they wait for a disability decision. In some states, the individual might have to repay unemployment benefits that they were not eligible for.

In any case, if you are approved for disability benefits, it makes sense to call the unemployment department and ask them to stop your unemployment benefits.

To protect yourself and make the best decision for your situation, it makes sense to talk to a disability lawyer about whether to file for both disability and unemployment benefits, and how to manage the timing of both filings.

By: Tim Moore, former Social Security disability claims examiner

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