You injure your wrist at work. Your doctor takes you off duty for six weeks. Then someone in human resources hands you a short-term disability application and tells you it is the fastest way to get paid. Applying may be perfectly reasonable, but how those forms are filled out can affect your workers' compensation claim.
Short-term disability and workers' compensation can both replace part of your paycheck, but they are not interchangeable. They come from different sources, follow different rules, and treat a work injury very differently. Here is what you need to know about short-term disability in Illinois when your injury happened on the job.
How Short-Term Disability Differs From Workers' Compensation TTD
Short-term disability (often called STD) is an insurance benefit, usually offered through your employer or bought on your own. It is designed for injuries and illnesses that are not related to work, such as a surgery, a pregnancy, or a fall at home. Illinois does not have a general statewide short-term disability insurance program for private-sector workers, so the rules for your benefit come from the policy itself. Policies commonly pay a percentage of your wages for a limited number of weeks, and many exclude work injuries entirely.
Workers' compensation is different. Under the Illinois Workers' Compensation Act, an employee who cannot work because of a work injury is entitled to temporary total disability benefits, called TTD. Under Section 8(b) of the Act, TTD is generally two-thirds of your average weekly wage, subject to state minimums and maximums. TTD covers your recovery period, generally until your condition stabilizes, a point called maximum medical improvement (MMI), while your doctor keeps you off work or your employer cannot offer work within your restrictions. TTD is not paid for the first three working days of incapacity. If you are unable to work for 14 days or more, however, TTD is owed from the day after the accident, including those first three days. Workers' compensation also pays your medical bills, which short-term disability does not.
There are other practical differences. TTD is not limited to a fixed number of weeks the way most short-term disability policies are. Workers' compensation benefits are generally not subject to federal income tax, while short-term disability benefits often are taxable, depending on who paid the premiums and whether they were paid with pre-tax or after-tax dollars. And only workers' compensation can lead to a permanent disability award or settlement at the end of your case. Learn more about how TTD benefits work in our quick answers guide.
| Short-term disability | Workers' compensation (TTD) | |
|---|---|---|
| Covers | Mostly non-work injuries and illnesses; many policies exclude work injuries | Injuries and conditions caused by work |
| Source | Your employer's plan or a policy you bought | Your employer's workers' compensation insurance, required by the Act |
| Wage replacement | Set by the policy | Generally two-thirds of your average weekly wage, within state limits |
| Medical bills | Not covered | Covered |
| How long | A fixed number of weeks under the policy | Generally until MMI, while you are off work or cannot be accommodated |
| Repayment | The policy may require repayment if workers' comp pays | Not repaid; may be reduced by a Section 8(j) credit |
The Risks of Using Short-Term Disability for a Work Injury
The biggest risk is what the paperwork says. Most short-term disability forms ask whether your condition is work-related. If you, your supervisor, or your doctor checks "no," the insurance company may later point to that form and argue that your injury did not happen at work. A short-term disability claim does not end your workers' compensation rights, but an inaccurate form can create a credibility problem you then have to explain to an arbitrator.
The second risk is delay. Under Section 6(c) of the Act, you must notify your employer of a work accident as soon as practicable, and no later than 45 days after it happens. Applying for short-term disability is not a substitute for reporting the injury as a work injury. Be clear in writing that you were hurt on the job. Read more about the 45-day notice rule and the three-year filing deadline.
The third risk is money. Short-term disability usually pays for a limited number of weeks and does not cover medical treatment. If your recovery takes longer, or you need surgery, you can be left without income or with medical bills that workers' compensation should have paid from the start.
Can You Get Short-Term Disability and Workers' Comp at the Same Time?
Generally, you cannot collect full benefits from both for the same time off work. Section 8(j) of the Act deals with this situation. It applies to benefits from a group plan covering non-work disabilities that your employer paid for in whole or in part, and only when those benefits would not have been payable if you had rights under the Act. A common example is a policy that excludes work injuries. Section 8(j) does not apply to plan benefits that would have been paid regardless of a work accident. When it applies, your employer can receive a credit against the TTD it owes for the same period. The credit is limited to the amount of compensation that would have been payable during that period.
Section 8(j) also protects you. If the short-term disability carrier later demands to be paid back, the employer that took the credit must hold you harmless, to the extent of that credit. In other words, you should not have to pay the same money back twice.
Section 8(j) can also extend your deadlines. When a qualifying plan of this kind pays benefits for what turns out to be a work injury, the time for giving notice and filing your claim generally does not begin to run until those payments end. There is an important exception: this extension does not revive a filing deadline that had already expired before the payments began. Because these rules turn on the details of your plan, it is worth having an attorney review the policy before you rely on them.
Policies you buy entirely on your own, with no contribution from your employer, are treated differently. The employer generally receives no credit for them, though the policy itself may have its own rules about work injuries.
When Short-Term Disability May Still Make Sense
There are situations where applying for short-term disability is reasonable. The most common is a denied or disputed claim. If the insurance company refuses to pay TTD while it disputes whether your injury is work-related, short-term disability may keep some income coming in while your workers' compensation case moves forward. Section 8(j) addresses how the two are sorted out later.
If you go this route, protect yourself. Report the injury to your employer as a work injury in writing. Make sure your doctor's records describe how the injury happened at work. Do not sign a form stating that your condition is not work-related. Keep copies of everything you submit and every payment you receive.
If your employer pressures you to use short-term disability instead of reporting a work injury, or treats you differently after you report one, know that Section 4(h) of the Act prohibits retaliation for exercising your workers' compensation rights. Read more about whether you can be fired while receiving workers' comp in Illinois.
Common Questions About Short-Term Disability and Workers' Compensation in Illinois
Does Illinois require employers to offer short-term disability? No. Illinois has no general statewide short-term disability insurance program for private-sector workers. Whether you have coverage, and what it pays, depends on your employer's plan or a policy you bought yourself.
I already applied for short-term disability. Is my workers' compensation claim ruined? Not necessarily. Many injured workers apply for short-term disability before they understand their rights. What matters is reporting the work injury, getting accurate medical records, and filing your claim on time.
Will I have to pay back my short-term disability benefits? The policy may require repayment once workers' compensation pays. When the employer took a Section 8(j) credit for an employer-funded plan, the employer must hold you harmless to the extent of that credit.
What to Do Next
If you were hurt at work, report the injury as a work injury first, in writing, within 45 days. Treat short-term disability as a backup, not a replacement. Read any form before you sign it. If the insurance company has denied your claim or your employer is steering you toward short-term disability, get advice before the forms pile up.
If you have questions about short-term disability and your Illinois workers' compensation claim, the attorneys at The Law Offices of Millon & Peskin, Ltd. can help. We represent injured workers throughout Chicagoland, including DuPage, Cook, Will, Kane, and Lake counties, from our offices in Wheaton and Rosemont. Consultations are always free, and we work on a contingency fee, so you pay no fee unless we recover benefits for you. Contact our workers' compensation attorneys or call 630-260-1130. Hablamos español.