It is tricky territiry for those who might consider applying for federal Social Security disability benefits while also signing up for state unemployment insurance.
On the one hand, a Social Security disability applicant, to be eligible, is claiming that any kind of work is impossible. On the other hand, asking for unemployment insurance means swearing that the applicant is “available, willing and able” to work. Often, continuing proof of job searches must be provided for unemployment to continue.
This sticky situation is usually not considered at the initial and reconsideration levels of application for Social Security benefits. But when a case arrives at the hearing stage of the appeal, issues of credibility arise. While receipt of unemployment benefits is not an automatic bar to disability benefits, it is a delicate matter to present to a judge. Technically, a claim cannot be denied solely on this basis. But there can be challenging moments if a claimant is directly asked a question such as: “were you lying then or are you lying now?”
Questions to be addressed include whether the application for unemployment benefits took place at a time when the applicant thought he could work. Explore the history of the unemployment application: was the claimant ever actually offered work? Were there work attempts that failed? A claimant may have truly believed that he could work when he applied for unemployment. A medical condition may have deteriorated since, or the marketplace may have demonstrated that the claimant is not employable. A desire to work is not determinative of ability to work.
The reality is that state unemployment benefits are processed and paid much more quickly than Social Security benefits. Most federal courts hold that application for unemployment is “some” evidence, but not conclusive evidence of ability to work, and of credibility.
Social Security is often says it is “never bound by the determination of another agency.” The Social Security Administration has devised its own precise standards for disability, and they are decidedly not the same as those of the state unemployment program. There is no medical assessment of work-readiness required to apply for unemployment. Treating physicians may even be advising against work.