Can You Receive Workers’ Compensation and Social Security Disability Together?
Workers’ compensation exists to protect employees who suffer injuries or illnesses directly related to their job. When someone is injured while performing their work duties, they may be eligible to receive benefits that cover medical treatment, lost wages, and disability payments. The goal is to provide immediate relief without requiring the worker to prove that the employer was at fault.
In California, the Division of Workers’ Compensation oversees these benefits, which include temporary disability, permanent disability, medical care, and sometimes job retraining or supplemental benefits. If a work-related injury is severe enough to prevent someone from returning to any gainful employment, that person may also qualify for SSDI. However, combining these two programs requires careful coordination to avoid overpayment or benefit reductions.
At The Law Office of Cezar J. Torrez, I frequently work with clients in Sacramento and the surrounding areas who are struggling with the aftermath of a serious work injury and wondering whether they can receive both workers’ compensation and Social Security Disability benefits simultaneously.
Under California law, this question is common—and the answer is yes, but with some very specific rules and limitations. Understanding how these two programs interact is critical for anyone seeking to maintain financial stability after sustaining a workplace injury that prevents them from returning to work.
In my experience, the intersection between workers’ compensation and Social Security Disability Insurance (SSDI) can significantly impact the amount of money an injured worker receives each month. Both programs are designed to provide support when a person is unable to work, but they operate under different laws and serve distinct purposes.
California’s workers’ compensation system addresses job-related injuries, while SSDI is a federal benefit administered by the Social Security Administration for those with long-term disabilities. Although you can receive both, one may reduce the other depending on the total amount of benefits.
How Social Security Disability Differs from Workers’ Compensation
While workers’ compensation focuses specifically on injuries that happen on the job, SSDI is a federal program that covers people who are unable to work due to any qualifying disability—whether or not it is work-related.
To qualify for SSDI, you must meet the Social Security Administration’s definition of disability, which generally means being unable to engage in substantial gainful activity due to a medically determinable impairment expected to last at least 12 months or result in death.
This difference is critical. Someone may receive workers’ compensation for a temporary work injury but not qualify for SSDI if they can still perform other kinds of work.
Conversely, if the injury is severe enough to cause permanent and total disability, the individual may be entitled to both types of benefits, although not in their full combined amounts due to offset rules.
How Offsets Affect Combined Benefits
Under federal law, if you receive both workers’ compensation and SSDI, your total monthly benefits cannot exceed 80% of your average current earnings before you became disabled. If they do, the Social Security Administration will reduce your SSDI payments to bring the total down to that threshold.
This is known as the workers’ compensation offset. For example, if your pre-injury average monthly earnings were $5,000, your combined SSDI and workers’ compensation benefits cannot exceed $4,000.
If your combined benefits go over that amount, your SSDI payment will be reduced. However, once your workers’ compensation payments stop—such as when you settle your claim or reach maximum medical improvement—your SSDI benefits may return to their full amount.
It is also important to note that California law allows for lump-sum settlements in workers’ compensation cases. When that happens, the Social Security Administration may prorate that settlement over time to determine how it affects your SSDI benefits.
The way this is structured in your settlement agreement can make a big difference in how much SSDI you receive moving forward.
How California Courts View Dual Benefits
California law recognizes that receiving both workers’ compensation and SSDI can be necessary for individuals with severe, long-term disabilities. Courts do not prohibit receiving both types of benefits, but they do expect full disclosure and accurate reporting.
Misreporting or misunderstanding the offset rules can lead to overpayment, which the federal government will eventually seek to recover.
To avoid this, I always advise clients to report any workers’ compensation settlements or changes in benefits to the Social Security Administration as soon as they occur. This keeps both systems updated and helps prevent unexpected financial surprises in the future.
When It Makes Sense to Apply for Both
In many situations, pursuing both workers’ compensation and SSDI simultaneously can be advantageous. If your work-related injury prevents you from engaging in gainful employment for an extended period, applying for both programs can help provide consistent financial support during your recovery or in the event of a permanent disability.
The process can be lengthy—SSDI claims are notorious for their extended processing times—but in the meantime, workers’ compensation can offer immediate support through temporary disability benefits and medical coverage. If the disability proves to be permanent, SSDI can then serve as a reliable long-term source of income.
Key Differences Between the Two Programs
Although both workers’ compensation and SSDI provide income support for individuals with disabilities, they operate under different rules. Understanding these distinctions helps clarify how and why benefits might overlap or be adjusted.
Here are the most important differences between the two:
Eligibility requirements: Workers’ compensation requires a work-related injury; SSDI does not.
Funding source: Workers’ compensation is employer-funded through insurance, while SSDI is funded through Social Security taxes.
Duration: Workers’ compensation benefits may be temporary or permanent, depending on medical findings, while SSDI benefits typically continue as long as the disability persists.
Benefit type: Workers’ compensation may cover medical bills and rehabilitation costs; SSDI only provides income support.
Offset rules: SSDI may be reduced based on the amount of workers’ compensation received.
Understanding these distinctions helps clarify how both programs can support injured workers under California law while avoiding conflicts between state and federal regulations.
How Settlements Can Impact SSDI
When someone resolves their workers’ compensation case with a lump-sum settlement, it can have long-term consequences for SSDI benefits. The Social Security Administration may treat that lump sum as ongoing monthly payments depending on how it’s worded in the agreement. This is where careful planning matters. By structuring the settlement to spread out the compensation over time—reflecting what it would have been if paid monthly—individuals can often minimize the impact on their SSDI benefits.
While federal law governs the SSDI program, California law governs workers’ compensation settlements, meaning the agreement must comply with both systems.
Medical Evidence and Documentation
Strong medical documentation plays a key role in receiving both workers’ compensation and SSDI. In both systems, medical evidence is required to establish the existence, cause, and severity of the disability.
In California’s workers’ compensation system, doctors use specific forms and rating systems to determine whether an injury qualifies as temporary or permanent. The Social Security Administration uses its own criteria to decide whether a disability meets federal standards.
Having consistent medical documentation between the two programs reduces the likelihood of conflicting decisions. When the medical findings align, it strengthens both your workers’ compensation claim and your SSDI application.
Handling Denials and Appeals
It is not uncommon for either workers’ compensation or SSDI claims to be denied initially. In such cases, California law provides procedures for appealing workers’ compensation decisions through the Workers’ Compensation Appeals Board.
Similarly, the federal government allows multiple levels of appeal for SSDI claims, including reconsideration, hearings, and appeals council reviews.
Persistence is often necessary when pursuing these benefits. A denial is not always the end—it may simply mean that more evidence or clarification is required. Many claimants ultimately win their benefits on appeal after providing additional documentation or testimony.
Long-Term Considerations for Injured Workers
For individuals with permanent disabilities, workers’ compensation and SSDI benefits can be vital sources of long-term stability.
However, it’s essential to note that SSDI benefits may be converted to Social Security retirement benefits when the recipient reaches full retirement age. This does not affect workers’ compensation, but it may change the type of federal support received.
Additionally, individuals receiving both benefits must keep the agencies informed of any changes in health, employment status, or income. Failing to report such changes can lead to overpayments or penalties. Staying proactive helps maintain eligibility and avoid unnecessary financial complications.
Protecting Your Rights Under California Law
In California, both state and federal laws exist to protect workers who have suffered disabling injuries. Whether your injury occurred on the job or not, you have the right to apply for benefits that provide income and medical support.
Understanding how workers’ compensation and SSDI interact under these laws is essential to maximizing your benefits while complying with all legal requirements.
Reach Out Today
Receiving both workers’ compensation and Social Security Disability benefits is possible under California law; however, doing so requires careful attention to the offset rules and clear coordination between state and federal programs.
When handled properly, this combination of benefits can provide much-needed financial support for those who are unable to work because of serious injuries.
At The Law Office of Cezar J. Torrez, I have seen firsthand the importance of injured workers understanding their rights under workers’ compensation and federal disability laws.
By approaching both claims carefully, maintaining accurate records, and communicating with the relevant agencies, individuals can avoid common pitfalls and secure the necessary support for the future.
Ultimately, the intersection of workers’ compensation and SSDI demonstrates how California’s laws and federal regulations can work together to protect injured workers—offering not only financial relief but also peace of mind during recovery.
My firm serves Sacramento, East Sacramento, Oak Park, South Natomas, North Sacramento, West Sacramento, North Natomas, Arden-Arcade, Rosemont, Lemon Hill, Pocket, and Riverview. Call my office today to schedule a consultation for your workers' compensation claim.