When a Michigan worker is injured on the job, it is important to promptly file a workers' compensation claim. However, many workers do not know that collecting workers' compensation can affect that worker's Social Security Disability benefits. An injured worker may already be entitled to some benefits or may become eligible for benefits based on the workplace injury. In either case, workers should know the Social Security Disability claim may be affected.
If an injured worker is unable to work that worker may file for Social Security Disability benefits in addition to workers' compensation. However, income from Social Security Disability benefits may be reduced due to a workers' compensation case settlement. Another important point to remember is that there are different burdens of proof of disability under Michigan's workers' compensation laws and Social Security Administration rules. Qualification for one benefit does not mean automatically mean qualification for the other benefit.
Under some circumstances an injured worker can limit the financial effect of the workers' compensation case settlement on Social Security Disability benefits by adding certain language to the compensation case settlement agreement or by ensuring that an addendum is made to the settlement stipulation. This language must be a part of the settlement at the time of approval by the Administrative Law Judge for it to be effective.
Injured workers who may also qualify for Social Security Disability Income may wish to consult an attorney about the potential loss of benefits arising from a workers' compensation case settlement, before agreeing to the judge's decision.
Source: SSA.gov, "How Workers' Compensation And Other Disability Payments May Affect Your Benefits," accessed on Feb. 9, 2015