Social Security Disability and Workers Compensation — Be aware!

Recently I had a client that settled her workers’ compensation claim for a lump sum amount of money.   The Attorney that she used for her workers’ compensation settlement, which WAS NOT Mooney & Associates, failed to draft the agreement with specific social security disability offset language.  Subsequently, she received an award of social security disability benefits.  However, she soon found out her monthly benefits would be greatly reduced for a period of two years.  This can have devastating effect on an individual’s financial situation.

It is not infrequent that an individual who is seriously injured at work or at an older age where the injury has caused the injured worker to be unable to perform the type of the labor they always have, that they may become eligible for social security disability benefits.  Social Security is entitled to an offset for workers’ compensation benefits received.


If your Attorney is not careful in how the language is drafted, such as the above example, it can have a major, substantial impact on your monthly disability benefits.  The offset requirement was adopted via a Federal Circuit Court of Appeals decision from 1989, Sciarotta v. Bowen , 837 F.2d 135 (3d Cir.1989).  It is based on the part of the social security law that you can only receive up to 80% of your average current earnings when receiving both social security disability and workers compensation benefits.  It is important to note that offset is not applicable to SSI benefits, only SSD benefits.  For an explanation on the difference of the two programs, view our article here.      

The most common way of reducing the potential offset is by reducing the lump sum award by all excludable expenses (attorney fees and future medical expenses provided) then amortizing the net lump sum award over the claimant’s life expectancy.  What is the effect if that language is not included in a workers’ compensation settlement agreement?  It can greatly reduce your social security disability payments, and for some, eliminate any payment for a period of years while the offset is paid in full.  That’s devastating and financially crippling!  It is also completely unnecessary!

At Mooney & Associates, we are vigilant in assuring that your workers’ compensation settlement is handled professionally and competently.  We provide offset social security language in every settlement agreement to protect our clients.

If you are an injured workers and have concerns, and you live in the Adams County, Cumberland County, Franklin County, Fulton County, Dauphin County, Lancaster County, or York County, call Mooney & Associates today.  Our consultations are FREE and we promise dedicated representation.    We will meet you in one of our twelve office convenient for you.  For office locations, visit us on the web at  For more information on Workers Compensation or Social Security Disability, link over to our website.