The bottom line is yes, you can collect disability payments (California State Disability Insurance or “SDI”) even if you are making a claim for lost wages or loss of earnings in your personal injury case. Although your personal injury attorney will likely not be the one to handle the logistics of setting up your SDI claim, you should do so to collect the maximum amount due to you because of the disability caused by the injuries you received in your pedestrian bicycle, motorcycle or auto accident. Further, collecting disability will provide you with some money up front or “as incurred” as opposed to money you may recover in your personal injury case, which you will not receive until the case is fully resolved. This may be months or even years down the line. The disability payments can help ease some of the financial burden experienced when you are out of work due to a personal injury.
What is California State Disability Insurance?
California State Disability Insurance (SDI) is a partial wage-replacement insurance plan for California workers. SDI is a state program that is funded through employee payroll deductions. SDI provides short term benefits to eligible workers who have suffered a loss of wages and are unable to work because of a non-work related injury, illness or pregnancy. Essentially, if you are a W-2 employee, you pay into SDI year-round, regardless of whether you will ever need to use it or not. So, if you do need to use it, you really should.
Am I eligible for SDI?
In order to be eligible for SDI you must meet the following requirements:
- Be unable to do your regular/customary work for 8+ consecutive days
- Be employed or actively looking for work at the time you became disabled
- You have lost wages because of your disability, or if unemployed, have been actively looking for work
- You must have earned at least $300 in earnings from which State Disability Insurance was withheld during a previous period.
- You must be under the care and treatment of a licensed physician during the first eight days, and must remain under their care and treatment to continue receiving benefits. You will want to be sure to speak with your medical provider(s) to complete the proper documentation to qualify you for SDI benefits initially and ongoing.
- You must complete and submit a claim form within 49 days of the date you became disabled
- Your physician must complete the medical certification of your disability
Note: An independent medical examination to determine the individual’s initial or continuing eligibility may be required.
You will be ineligible for SDI if you:
- Are receiving Unemployment Insurance or Paid Family Leave benefits
- Are receiving Workers’ Compensation benefits at a weekly rate equal or greater than the SDI rate
- Are receiving sick leave wages that are equivalent to your full salary. If you are receiving only partial sick leave wages, you may be eligible for full or partial SDI benefits.
- Fail to have an independent medical examination when requested to do so
Note: Vacation pay is NOT in conflict with SDI benefits, so you can receive both at the same time.
How much money will I receive under SDI?
SDI typically pays 55% of your wages for up to 52 weeks of disability. The State will look at your wages in a 12 month period of time in order to determine your average wages. It typically takes approximately two weeks to receive your first benefit check after you file your claim. For more information on the amount of SDI you are eligible for, and how it is calculated, please see http://www.edd.ca.gov/disability/DI_Benefit_Amounts.htm. Again, even though the amount of the benefit is only about half of what you would normally make, this money can help you offset some of the financial burden that comes with being out of work and injured from a personal injury. You do not need a personal injury attorney working on your case to get SDI. You can do this on your own.
How will SDI affect my personal injury case?
If you are out of work due to an injury related to a personal injury case, and you meet the above requirements, you should seriously consider making an SDI claim to receive supplemental income while your personal injury case is pending. However, be sure to check to make sure that you are not receiving other sources of income from your employer to replace your lost wages while you are out of work. You are required to report any employment benefits you are receiving to the State when filing for SDI to determine your eligibility for benefits. Thus, employment benefits can disqualify you from receiving SDI or reduce the amount of your SDI benefits. Again, vacation pay does NOT count against your SDI eligibility, but sick pay does.
SDI will not directly affect your personal injury case or settlement amount. Since SDI funds are deducted from your paycheck each pay period (yes, YOU pay for them), you can – if eligible -tap into these funds and receive SDI benefits without having to pay back the State of California, even if you subsequently recover for loss of earnings in your settlement proceeds.
The legal rule behind this system of recovery is referred to as the “collateral source rule.” The collateral source rule basically enables an injured party to receive compensation for his/her injuries from a source independent of the wrongdoer (i.e., the person who hit you), and also collect damages directly from the wrongdoer for the same loss the injured party has already been compensated for. Thus, a person MAY still collect loss of earnings directly from a wrongdoer, regardless of the fact that they have already received SDI benefits to compensate them for wage loss while they were out of work due to their personal injury accident.
The logic behind this rule is based on the theory that the wrongdoer (i.e. person who caused you to suffer the injuries) should not be able reap the benefits that are available to and used by the victim. Think of it this way—the injured party was run over by negligent driver, and subsequently was out of work for six weeks. With a lack of income, the injured party is likely accruing a plethora of medical expenses on top of the expenses necessary to live. Since the injured party is in need of immediate income in order to make it through the time they are out of work due to the accident, they file for SDI benefits. Courts have reasoned that just because an injured person is receiving funds to compensate them for the time they are out of work, a wrongdoer does not get off the hook for the losses that they caused. Accordingly, it would be unfair for the negligent party to get out of paying the injured party’s loss of earnings merely because they were already receiving a benefit for the lost earnings. Courts have therefore decided that in such scenarios—the reverse should occur; if anyone is going to benefit from a collateral/independent source of funds to compensate a party for a component of their damages, it should be the injured party. Thus, regardless of whether or not you collect SDI benefits pending your personal injury case—you will still be entitled to recover loss of earnings from the party that was negligent and injured you, if your injury prevented you from working for a period of time. If you are unsure, ask your personal injury lawyer about whether or not you should claim SDI related to your personal injury case.