Find out how unemployment benefits and workers’ comp work together in Arizona
When you are out of work, whether it is because you have been laid off or you were seriously injured, there may be several options for income replacement. Unemployment and workers’ compensation are among 2 of the most common and widely used financial benefits that help hardworking Arizonans make ends meet while they search for another job or heal from an injury.
It’s important to understand how these benefits interact with each other to be sure you get the compensation you are entitled to receive.
What is unemployment?
Unemployment insurance is designed to provide you with some income if you have lost your job through no fault of your own. This may be because you were laid off due to a work shortage or your company closed, leaving you with no work. The state determines unemployment benefits and the amount you may receive varies depending on where you live.
You are not usually eligible for unemployment if you were terminated for cause. Unemployment benefits are awarded regardless of your financial situation, but the amount you receive is limited. In addition, typically you can only receive unemployment benefits for 26 weeks in Arizona (and in most other states).
What is workers’ compensation?
Workers’ compensation, on the other hand, pays your medical bills and a portion of your average weekly wages when you get injured or become ill on the job. You may be eligible for workers’ compensation even if you are partially or fully responsible for your illness or injury, although there are some exceptions. For example, you may not be able to collect workers’ compensation if you were under the influence of drugs or alcohol when you were injured.
There are no limits to how long you can collect permanent disability workers’ compensation benefits, though generally it ranges from 3-7 years. As long as your doctor says you are unable to work, you may collect benefits in most cases. The insurance company will determine the amount you receive each month—usually around two-thirds of your regular salary.
Collecting unemployment and workers’ compensation
In most cases, you are unable to collect unemployment while you are receiving workers’ compensation benefits. However, in some states, you may receive temporary partial disability payments if you are able to do some light-duty work but can’t perform your regular duties. If your employer doesn’t offer light duty, you may be able to receive unemployment benefits.
If you are seeking other employment, it’s possible you could qualify for unemployment—unless your state has rules against what is known as “double dipping.” In many states, the only way you are eligible for both unemployment and workers’ compensation is in the case of a serious injury, such as amputation, disfigurement or another catastrophic injury.
After a work injury recovery
If you have reached what is known as “maximum medical improvement,” (or MMI) you may be eligible for unemployment while you are searching for a new job. This happens if your doctor states that you have lasting mental or physical limitations that would make it impossible to perform your previous job duties.
In most cases, an employer will offer a workers’ compensation settlement or award permanent partial disability.
Old job no longer available
You may also qualify for unemployment if your old job is no longer available after you have recovered from your illness or injury. In every state, it’s illegal to fire someone for filing a workers’ compensation claim. However, in Arizona, your employer is not required to provide you with a job if the position you were in has been phased out or a work slowdown has led to layoffs.
Workers’ compensation denied
If your employer’s workers’ compensation insurance company denies your claim and you are unable to work, this may make you eligible for unemployment. Keep in mind that if you are successful in getting the denial overturned, the unemployment benefits you have received could be deducted from the workers’ compensation you receive that covers the same timeframe.
State laws related to unemployment and worker’s compensation can be complicated. One of the best ways to preserve your rights under the law is to hire an attorney who understands both workers’ compensation and unemployment.