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Friday, September 2, 2011

Short-Term Disability, Family Leave, ADA and Workers' Compensation - How They All Fit Together

When an employee is required to miss work due to a physical ailment, many different issues and/or laws come into play.  We break down the most common below.

NOTE: Click Here to read about the interplay between FMLA, Short-Term Disability and Unemployment Compensation. 

WHAT IS SHORT-TERM DISABILITY?
Provides Income Reimbursement but No Job Security 

The term Short-Term Disability ("STD") refers to insurance payments that are made to employees who have to miss work due to a physical infirmity.  STD insurance is typically purchased by the company (employees may be required to contribute to the premium payment) and one's right to benefits is usually determined by the insurance company from whom the policy is purchased. Thus, while an employee may have to make his/her need for STD benefits known to the company's HR Department, the company has no say into whether an employee is entitled to the benefits - that decision is made by the STD insurance carrier.

STD payments are made by the STD insurance carrier and are typically the equivalent of about 2/3rds of one's regular salary.  STD benefits are usually payable for about 6 months - then one must file for Long-Term Disability benefits.

An employee may be entitled to STD benefits if he/she suffers a personal injury, has a need for leave under the Family and Medical Leave Act ("FMLA") or is suffering physical complications related to a disability covered under the Americans With Disabilities Act ("ADA"). Typically, one has to be out of work for at least one week before the right to STD benefits is matured.

CAN MY EMPLOYER FIRE ME IF I AM RECEIVING SHORT TERM DISABILITY BENEFITS?

An employer does not have to hold open an employee's job merely because he/she is receiving STD benefits. STD benefits are monetary payments, and do not provide employees with any right to job   reinstatement upon recovery. Fair or not, and subject to the exceptions stated below, it is not illegal to fire an employee who is out of work and receiving STD benefits.

CAN I TAKE FAMILY LEAVE AND RECEIVE SHORT-TERM DISABILITY AT THE SAME TIME?

Job Security - No Income Reimbursement
As a general rule, the only federal law that expressly prohibits terminating an employee who is out of work due to a physical condition is the FMLA. Leave under the Family and Medical Leave Act is unpaid - the purpose of the statute is only to provide a right to job reinstatement provided that the employee returns prior to the expiration of the FMLA leave period. 

However, if an employee has to miss work due to his/her own physical condition, the employee may obtain STD benefits while out on FMLA. Accordingly, by exercising one's rights to FMLA leave and Short-Term Disability benefits in tandem, an employee secures both job reinstatement rights and a portion of one's normal wages.

CAN A SICK LEAVE BE AN APPROPRIATE REASONABLE ACCOMMODATION UNDER THE AMERICANS WITH DISABILITIES ACT?

Another potential source of job security if one is suffering from a health condition causing absence from work is the ADA. There is typically little question that a person missing work due to an ADA disability will qualify for STD benefits. In such cases, if FMLA leave is available, use it.

ADA - May Provide Additional Leave as Accommodation
If, however, one is not entitled to FMLA leave, or is unable to come back to work when FMLA leave expires, then applying for leave as a "reasonable accommodation" under ADA may be appropriate.  However, one should expect that leave as a reasonable accommodation would be of a shorter duration than the 12 weeks leave provided for under FMLA.  In sum and substance, if one needs a week or two to fully recover from the onset of an acute problem arising out of a disability, a strong argument can be made that such leave is a required reasonable accommodation under ADA.

CAN THEY DENY ME SHORT-TERM DISABILITY BENEFITS IF I HAVE A DOCTOR'S NOTE?

Insurance companies can and will fight anything. It is fair to say that if an employee has a documented, clear physical injury (broken/fractured bone, herniated disc, surgical procedure), there is a much greater likelihood that STD benefits will be granted without argument.

Cases involving emotional/psychological afflictions, on the other hand, are typically the more hotly-contested claims. Nevertheless, I have found that, with proper medical documentation, such stress-related claims are frequently successful.

However, and particularly where stress-related claims are involved, STD carriers may contest a claim if there is an issue as to whether the condition is work-related.

CAN THEY DENY ME SHORT-TERM DISABILITY BENEFITS IF I SEEK WORKERS' COMPENSATION BENEFITS?

In short:  Yes.

Either STD or WC, but Not Both
The standard STD insurance policy states that workers' compensation insurance must provide salary reimbursement where work-absences arise out of work-related injuries.   Consequently, if one is approved for Workers' Compensation benefits, one will be ineligible for STD benefits. If, however, an employee's Workers' Compensation claim is denied, the application for STD benefits will be considered in due course.

NOTE:  All companies are required to have workers' compensation insurance for all employees.  STD insurance, on the other hand, is not required, and falls under the category of "benefits." 

CAN I GET SHORT-TERM DISABILITY BENEFITS FOR STRESS?

Yes, but stress claims are among the most contested of all STD claims. One issue comes up a lot where stress claims are concerned - is the stress at issue work-related? If so, then the employee may have to file a Workers' Compensation claim and have that decided before any possible right to STD benefits arises. In my experience, Workers' Compensation insurers often fight stress benefit claims more vigorously than do STD insurers.

WHAT IS WORKERS' COMPENSATION INSURANCE?

Workers' Compensation insurance protects workers from loss of wages and medical expenses due to work-related injuries.  Workers' Compensation laws are enacted by states.  Since I practice in Pennsylvania, I will discuss how it works here, which I believe is typical of many states.

If an employee is injured while performing his/her job duties, a right to workers' compensation benefits arises.  The typical employer has purchased Workers' Compensation insurance from an insurance company, which in turn then decides claims and pays benefits where appropriate.

Most Workers' Compensation insurance policies pay employees approximately 2/3rds of their regular wage, pursuant to state laws, and also pay for all medical bills arising out of the injury.

CAN I BE FIRED WHILE OUT ON WORKERS' COMPENSATION?

Pennsylvania's Workers' Compensation statute does not provide for any right to job reinstatement upon the employee's ability to return to work.  Thus, in theory, you may be fired while out of work due to a work-related injury (absent FMLA protection).  However, the courts in Pennsylvania have held that it is illegal to fire an employee because he/she has filed such a claim. 

I have found that if a company is going to fire someone who has filed a Workers' Compensation claim, they wait until the person is released back to work. 

This is so because employees who have been fired while out of work due to a work injury are likely to take a little while longer to "recover" - after all, where is the incentive to recover and thereby cut off their only source of income, the workers' compensation benefits they are receiving?  Employers know that firing an employee who is out of work while receiving Workers' Compensation wage loss benefits will have the likely effect of prolonging the former employee's recovery period, which in turn has the effect of increasing the company's Workers' Compensation insurance premiums. For this reason, if no other, I rarely see cases where employers have fired employees who were receiving wage loss benefits due to a work-related injury.

On the other hand, firing an employee soon after he/she has returned from a Workers' Compensation absence raises serious red flags, and in Pennsylvania will likely spark a lawsuit unless there is clear evidence that the employee did something (other than have the temerity to file a Workers' Compensation claim) that warranted termination.

CAN I GET FMLA LEAVE AND WORKERS' COMPENSATION AT THE SAME TIME?

Yes.  FMLA provides another layer of job security, and may be taken when one is required to miss work due to a work-related injury.

ALPHABET SOUP

FMLA, ADA, STD, LTD, Workers' Compensation, Social Security and Unemployment Compensation may all be implicated when an employee is required to miss work due to a physical malady.  Understanding how all of these laws fit together is a challenge, and I hope that this post has provided some useful guidance.

John A. Gallagher, Esquire, Philadelphia Area Employment Lawyer.

25 comments:

Top Online Games said...

nice post

Employment Lawyers said...

Thanks; my goal is to provide good, clear information to people so that they may maximize their employment rights while minimizing common errors that can cause loss of employment, benefits, etc.

Injury Compensation Ireland said...

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chicago personal injury lawyer said...

We always wonder to find all things together. Nice post.

Employment Lawyers said...

Chicago PI - my pleasure, and Thank You!

Anonymous said...

Thank you for this wonderfully detailed article. However, I am curious about something.

I filed and was approved for STD benefits. I was communicating with the insurance person mainly via email and have kept all communication. About two months after approval, I received a certified letter of termination from my employer - the reason they provided was that the insurance company told them that I wasn't responding to their communications. But I was, and I have proof that I was.

I was basically fired because the insurance company lied to my employer, otherwise they had no basis whatsoever to fire me. Is this legal and is there any way that I can fight this?

Employment Lawyers said...

Dear Anonymous:

Thank you for your kind words.

I am afraid that, as an "at will employee" (I presume) you do not have a wrongful discharge claim even if the STD carrier lied to your employer. You should be able to win unemployment benefits, though.

You may want to try writing a nice letter to your employer, giving it proof that you had been communicating with the STD carrier; I doubt that will help, but it is worth a try.

John A. Gallagher

Temporary Jobs said...

You have bought up some really interesting points in your post. Thanks for sharing. This company provide some interesting insight as well.

Anonymous said...

I'm out of work for FMLA reasons, I think I broke my foot, can I collect STD from my job while I'm still out of work?

Employment Lawyers said...

Anonymous With Broken Foot: You may certainly apply for STD benefits while out on FMLA leave and if the injury in fact precludes you from working you will qualify for STD benefits (assuming, of course, your employer has an STD insurance policy)

Anonymous said...

This post is very crisp and clear to get basic idea of the terminology. Though I work in HR IT, I always get confused with this terminology. This helps me a lot!

Mike Carrington said...
This comment has been removed by the author.
Anonymous said...

I am on STD for about 3 months and my emplyer sent me an email about my job being terminated, can i still get short term disability?

Anonymous said...

can i take std for 13 weeks as my contract provides and then fmla or can the employer count the 13 weeks as part of my fmla leave even if i had not applied or was ask to by the company/until my 13 weeks was up

gareth batty said...

Social Security Disability Insurance (SSD or SSDI) is a payroll tax-funded, federal insurance program of the United States government. It is managed by the Social Security Administration and is designed to provide income supplements to people who are physically restricted in their ability to be employed because of a notable disability, usually a physical disability. SSD can be supplied on either a temporary or permanent basis, usually directly correlated to whether the person's disability is temporary or permanent.

thanks a lot for sharing
disability claims lawyer

Anonymous said...

Hi,
I've been on Work Comp for awhile now because of a back injury. Been doing light-duty in the warehouse, and receiving benefits as usual. I was told that I probably have about 2 more weeks until the Dr. feels comfortable releasing me to full duty. The problem is, 4 days ago, I had my gall bladder removed due to complications with gall stones, and I can barely walk at this point. I don't know whom to contact first. My employer? Work comp insurance agent? My Health insurance? Family Doctor? Im so scared that Ill get the runaraound.

Thank you.

Anonymous said...

My father is out of work on short term disability due to a seizure disorder that required brain surgery. He could not use FMLA because his time had been used throughout the year. His job was posted in February because he was on leave for to long. His long term disability will kick in on May 15 however he has been cleared to return to work as of May 6. His employer stated that he has to reapply for new positions, be interviewed, and then may be placed into a position if the manager wants to hire him. If a manager does not chose to hire him by the 15th he will be terminated. He has applied for 12 separate positions and has not been called about even one. He is qualified for all positions and able to complete the job. Is there anything he can do or does the employer have the upper hand?

Employment Lawyers said...

Anonymous:

This is an extremely complex and facts-dense inquiry, and I cannot possibly do it justice on line. However, if your father is qualified for other positions that he has been denied, he should seek legal advice on the issue as to whether he has been subjected to disability discrimination under ADA.

Regards,

John A. Gallagher

Employment Lawyers said...

Anonymous With Gall Bladder:

The Gall Bladder surgery is not workers comp matter, since it is not a work-related injury. You may seek FMLA leave if you are qualified, and then apply for STD benefits if the company has an STD policy.

Good luck!

Regards,

John A. Gallagher

Anonymous said...

My dr. put me off work permanently and can no longer drive. So i went out on fmla and std that id paid into until i hear something from ssd. well the std approved me and had sent a couple checks. I haven't received abything from them in a month. She called today and said i no longer qualified because i don't see my specialist monthly!? hes sent her all papers and everything but i only see him every couple months because i have uncontrolled narcolepsy. That is why i can no longer work because it can't be controlled and he is treating me the only way possible. can they do that because i don't see him monthly?

Anonymous said...

I had a doctors appointment in July 2013 and was put out for the day. I had a scheduled appointment in August 2013 for a follow up and it was my doctors medical advice for me to cease work altogether. I have many health issues. I personally paid or my std benefits, not my employer. They laid me off the same day (morning of) my doctors appointment but before the scheduled Dr visit. They just denied me for not being employed however, I paid the premium through the lay off date. They withdrew it from my pay and my separation agreement clearly states life and disability will end on that date. The insurance company refuses to give me the time the policy expired that day and I have never been provided a plan summary from the employer or carrier ever. Please help.

Anonymous said...

I'm on workers comp waiting for a knee surgery. have been off work but was just released to high restrictions. that is until surgery then off again until I'm healed.my employer has not answered me back about and light duty work.,in my profession there realy is no light duty work. will I loss w/c benefits if I don't work until I can go back with no restrictions?

Anonymous said...

I had gotten a bulging disc which caused me to go on fmla for a week. I did this while working in the yard and had no prior problems with my back. I filed for std and they denied me because I was one day short on my absences. I needed to be absent for 8 days and was only absent for 7. They said I i did not qualify for bodily injury std which entails no waiting period because I did not go to the doctor until Monday when my doctor was available and the accident happened the Friday before. Yet my std disability did not state the requirement of going to the doctor the same day as Injury. Long story short I was approved for fmla and took a week off from work after that week and because I didn't get approved for std they used that week of pto that I used because I still wasn't in working condition against the week they denied me std for and caused me to have attendance problems and u was terminated. The mri showed I had a bulging disc that was most likely pressing up against a nerve and causing extreme pain. Do I have a case. And what steps should I take. This has been absolutely horrible for me because I filed unemployment and didn't represent my case with the state well and was denied unemployment. I just keep getting screwed it seems like. Help

Anonymous said...

I am out on STD due to having a c section. My std insurer is denying full payment because there were no complications during my surgery they will only pay me for 6 weeks instead of the 8 that I am required to be out. After being denied the 1st time my dr wrote a letter appealing and I was just denied again. Is there any advice you can give me? Thank you.

Anonymous said...

Great resource. Question I pay for my STD as an optional benefit. I am pregnant and want to leave the job before the birth. Can I continue paying the premium and keep/ extend the policy