Can Tennessee reject your Social Security disability claim just because you are also drawing unemployment?

Plain-English summary

Tennessee's Disability Determination Services (DDS) helps the Social Security Administration (SSA) decide whether applicants for Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI) meet the federal definition of disability. State Representative Barrett Rich asked whether DDS could reject a disability claim because the applicant was applying for or receiving unemployment insurance benefits.

The Attorney General concluded that DDS cannot categorically reject a disability claim solely because the applicant receives unemployment compensation. Federal courts cited in the opinion had found that receiving unemployment benefits does not, by itself, prove the ability to work. The opinion does not decide whether an individual applicant qualifies for disability benefits or how DDS should weigh unemployment benefits alongside other evidence.

The cited decisions address different records. In Lackey v. Celebrezze, the court noted the lack of proof that the claimant told state authorities he could work or knew the requirements for unemployment compensation. In Roberts v. Callahan, the court remanded for reconsideration of a credibility finding even though the claimant had said she was willing to work and applied for jobs. Alverio v. Chater found that simultaneous receipt of unemployment and an application for disability did not negate the claim or supply substantial evidence of a lack of credibility. The opinion also cites Judge Swygert's dissent in Kinsella v. Schweiker for the observation that mere receipt of unemployment benefits does not prove ability to work. That observation is attributed to the dissent, not to the Sixth Circuit majority.

Currency note

This opinion was issued in 2010. Check current federal law and SSA guidance before applying its conclusion to a present claim.

Background and statutory framework

The opinion says SSDI and SSI claims are governed, funded, and administered under federal law. SSA decides eligibility. In Tennessee, SSA contracts with the Department of Human Services' DDS section to perform functions that include determining whether an applicant is disabled under federal law and regulations. DDS determinations and SSA's final eligibility decisions can be reviewed or appealed through the federal system, including administrative hearings and federal judicial review.

The opinion's footnote distinguishes the programs. SSDI is financed through Social Security taxes, and a worker generally needs enough taxable work credits to be insured. SSI is financed through general revenues and is available to otherwise eligible people with limited income and resources who are disabled or blind.

The legal issue here is narrow. The Attorney General relies on federal court decisions for the proposition that unemployment compensation alone does not prove ability to work. Its conclusion rules out a categorical denial based solely on receipt of those benefits. It gives no instructions on a particular claimant's evidence, concurrent eligibility, benefit amounts, or any offsets.

Common questions

Q: Can Tennessee DDS deny my disability claim just because I receive unemployment benefits?
A: The opinion says a categorical denial based solely on receipt of unemployment compensation would be inconsistent with federal requirements. It does not say that every person receiving unemployment qualifies for disability benefits.

Q: Does applying for unemployment automatically disqualify a disability applicant?
A: The request mentions applicants who are applying for or receiving unemployment benefits. The opinion's stated conclusion concerns categorical denial based solely on receipt of unemployment compensation; it does not separately analyze an application that produced no benefits.

Q: Does the opinion say what weight DDS should give unemployment benefits in an individual case?
A: No. It rejects using receipt alone as an automatic reason for denial and does not prescribe how DDS must evaluate a particular claim.

Q: Is the statement in Kinsella a ruling by the Sixth Circuit majority?
A: No. The opinion cites Judge Swygert's dissent for the statement that mere receipt of unemployment benefits does not prove ability to work.

Q: Who decides and hears appeals of Social Security disability claims?
A: DDS performs disability determinations for SSA in Tennessee; SSA makes final eligibility decisions. The opinion says review and appeals occur through the federal system and may include a hearing before a federal administrative law judge or federal court review.

Citations and references

Cases cited by the opinion:

• Lackey v. Celebrezze, 349 F.2d 76 (4th Cir. 1965)
• Kinsella v. Schweiker, 708 F.2d 1058 (6th Cir. 1983) (Swygert, J., dissenting)
• Roberts v. Callahan, 971 F. Supp. 498 (D.N.M. 1997)
• Alverio v. Chater, 902 F. Supp. 909 (N.D. Iowa 1995)
• Riley v. Heckler, 585 F. Supp. 278 (S.D. Ohio 1984)
• Flores v. Dep't of Health, Educ. and Welfare, 465 F. Supp. 317 (S.D.N.Y. 1978)

Source

• Landing page: https://www.tn.gov/attorneygeneral/opinions.html
• Original PDF: https://www.tn.gov/content/dam/tn/attorneygeneral/documents/ops/2010/op10-106.pdf

Original opinion text

October 27, 2010

Opinion No. 10-106

Relationship Between Social Security Disability Claims and Unemployment Insurance Benefits

QUESTION

Does Tennessee or federal law, rule or regulation permit the Department of Human Services' Disability Determination Services section to reject a Social Security disability claim if the claimant is applying for or currently receiving unemployment insurance benefits?

OPINION

Based upon a number of federal court decisions, we conclude that a categorical rejection by the DDS of a Social Security disability applicant's claim of disability that is based solely upon the applicant's receipt of unemployment compensation would be inconsistent with federal requirements.

ANALYSIS

Claims for Social Security disability benefits, whether for SSDI (Social Security Disability Insurance) or for SSI (Supplemental Security Income), are governed by federal law, and are federally funded and federally administered. The Social Security Administration (SSA) makes decisions with respect to eligibility for SSDI and SSI benefits. In Tennessee, the SSA contracts with the Tennessee Department of Human Services' Disability Determination Services section (DDS) to perform certain functions connected with the programs. These functions include the determination of whether or not an applicant for benefits is disabled, as defined by federal law and regulations. DDS' disability determinations, as well as the SSA's final eligibility decisions, may be reviewed and appealed. These reviews and appeals are conducted through the federal system, and may include administrative hearings before federal administrative law judges and judicial review in the federal courts.

A number of reviewing federal courts have held that a Social Security disability claimant's acceptance of state unemployment compensation does not, in and of itself, prove an ability to work. See, e.g., Lackey v. Celebrezze, 349 F.2d 76, 79 (4th Cir. 1965) (claimant entitled to disability benefits where no showing made that claimant actually represented to state authorities that he was able to work or that he was aware of legal requirements for unemployment compensation); Kinsella v. Schweiker, 708 F.2d 1058, 1066 (6th Cir. 1983) (Swygert, J., dissenting) (noting that the mere receipt of unemployment insurance benefits does not prove ability to work); Roberts v. Callahan, 971 F. Supp. 498 (D.N.M. 1997) (although claimant had to state she was willing to work and that she applied for some jobs in order to receive unemployment benefits, case remanded to reconsider credibility determination); Alverio v. Chater, 902 F. Supp. 909, 928 (N.D. Iowa 1995) (finding that claimant's simultaneous receipt of unemployment insurance benefits and application for social security disability benefits did not negate her claim of disability or indicate substantial evidence of her lack of credibility); Riley v. Heckler, 585 F. Supp. 278 (S.D. Ohio 1984) (claimant entitled to award of past due disability benefits despite receiving state unemployment benefits); Flores v. Dep't of Health, Educ. and Welfare, 465 F. Supp. 317, 322 (S.D.N.Y. 1978) (record showing that administrative law judge relied almost exclusively on claimant's receipt of unemployment benefits failed to sustain denial of claim, but rather established that claimant made prima facie showing that he was unable to work at his former occupation).

Accordingly, we conclude that a categorical rejection by the DDS of a Social Security disability applicant's claim of disability that is based solely upon the applicant's receipt of unemployment compensation would be inconsistent with federal requirements.

[Footnote 1: Social Security Disability Insurance (SSDI) is financed with Social Security taxes paid by workers, employers, and self-employed persons. To be eligible for a benefit under the program, the worker must earn sufficient credits based on taxable work to be "insured" for Social Security purposes. Disability benefits are payable to blind or disabled workers, widow(er)s, or adults disabled since childhood, who are otherwise eligible. Supplemental Security Income (SSI) is a program financed through general revenues. SSI disability benefits are payable to adults or children who are disabled or blind, have limited income and resources, meet the living arrangement requirements, and are otherwise eligible.]

ROBERT E. COOPER, JR.
Attorney General and Reporter

CHARLES L. LEWIS
Deputy Attorney General

SUE A. SHELDON
Senior Counsel

Requested by:

The Honorable Barrett Rich
State Representative
204 War Memorial Building
Nashville, Tennessee 37243-0194