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Brandon, Esq.
Brandon, Esq., Lawyer
Category: California Employment Law
Satisfied Customers: 1802
Experience:  Has received a certificate of recognition from the California State Senate for his outstanding legal service.
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Hi -- I have been on California state disability since April

Customer Question

Hi -- I have been on California state disability since April but remained employed (but off work) the entire time. Last Friday, the company where I have been employed had a huge layoff -- including me. They are offering a severance pay package. I have checked California employment law (affects EDD) and section 1265 indicates that EDD does not count severance pay as wages. The people that staff the disability at the local EDD office tell me that the rules are different for disability.

That doesn't seem possible, since it is under the EDD section of state law. Could you please set me straight on this?

Thank you!
Submitted: 12 months ago.
Category: California Employment Law
Expert:  Brandon, Esq. replied 12 months ago.

Employment-LawExpert :

Hello and thank you for your question today.

Employment-LawExpert :

Are you online with me?

Customer: Yes, on iPad
Employment-LawExpert :

Welcome to the chat


 

Employment-LawExpert :

Unfortunately, I must tell you that the people who staff the disability at the local EDD are right, but not for the reasons you may think.

Customer: Are you there?
Customer: Why are they right?
Employment-LawExpert :

Yes I am here, it will just take me a few moments to type up your response.

Customer: great thanks
Employment-LawExpert :

It is not that disability payments offset unemployment, but rather to receive disability payments, you must be unable to work. To receive unemployment, you must be ready, willing and able to work.

Employment-LawExpert :

Thus, the EDD has stated that you cannot be on both programs simultaneously

Customer: Not sure if you get it -- I am already on disability and was also laid off with a severance package.
Employment-LawExpert :

Yes I understand that

Employment-LawExpert :

oh you are asking if severance affects your disability payments?

Customer: i saw a previous answer where a person applying for disability was told that EDD does not use severance as wages (as basis for how much he will receive).
Customer: The definition of wages on EDD PDF that I have says that severance is not considered wages.
Customer: Yes, asking if severance affects my disability payment!
Employment-LawExpert :

That is true for the purposes of unemployment

Employment-LawExpert :

However, severance payments do offset disability payments. The offset is calculated based on the gross disability payments and gross severance payments.

Employment-LawExpert :

When the severance payment period ends, the disability benefit will resume

Employment-LawExpert :

according to the normal schedule if you are still considered disabled

Customer: But for disability? I have not worked, and the general definition I have seen says that it can be counted as a supplemental payment.
Customer: can you reference a stature? I cannot find one either way. Just section 1265 of calif. law
Customer: whichl is for EDD
Employment-LawExpert :

Yes, please give me a few minutes and I will find a link for you

Customer: http://www.edd.ca.gov/pdf_pub_ctr/de231a.pdf
Customer: This is from EDD -- cites judges rrulimgs
Customer: http://www.edd.ca.gov/uibdg/Total_and_Partial_Unemployment_TPU_46035.htm
Employment-LawExpert :

Correct, but as I mentioned before that is for the purpose of receiving unemployment.

Employment-LawExpert :

You are asking if it affects disability payments

Customer: Yes sit
Customer: Sir
Employment-LawExpert :

I know it does affect it, but the exact provision of the law is eluding me at the moment. Would you like me to opt out in case another expert has it off the top of their head?

Employment-LawExpert :

Or would you like to come back in ten minutes when I will have a link for you?

Customer: How about come back in 10 minutes. Thank you.
Employment-LawExpert :

Not a problem.

Employment-LawExpert :

Also, I should ask, is the severance as a lump sum or payment over time?

Employment-LawExpert :

Because, if I can find it, the opinion letter sent out by the EDD specifically references that installment payments of severance would effect disability, while a lump sum payment would not.

Customer: Over time, not lump sum.
Employment-LawExpert :

That's what I assumed, I will find it for you.

Customer: Thank you
Customer: Here is what I found on justanswer: http://www.justanswer.com/ca-employment-law/6hbvh-applying-california-disability-benefits.html
Customer: it seems to go with my thesis about section 1265
Employment-LawExpert :

There is no question that severance is not considered wages, and I definitely understand the confusion that this is causing because of that. Unfortunately, without the opinion letter, I cannot give you the exact reason behind it, just that i know they do it. As you can see from this bad rating a previous expert got on a different question from JustAnswer.

Employment-LawExpert :

If the reason they are denying you is because they are calling it a wage, then the California Supreme Court has ruled that dismissal and severance payments of any kind, are not wages for any purpose relating to disability benefits.

Customer: That is the same answer!
Customer: Awesome! Thank you so much
Employment-LawExpert :

However, it is my understanding that there is a separate reason why SDI payments are reduced based on installment payments

Employment-LawExpert :

Would you you like me to opt out while I continue to look for you in case another expert is able to respond to you sooner?

Customer: No, we're good -- thank you!
Brandon, Esq., Lawyer
Satisfied Customers: 1802
Experience: Has received a certificate of recognition from the California State Senate for his outstanding legal service.
Brandon, Esq. and 3 other California Employment Law Specialists are ready to help you

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