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LTD & COVID-19 Part 1: Should I Apply for CERB While Receiving LTD?

MK Disability Lawyers will be looking in-depth at how long-term disability benefits may be impacted by COVID-19. This post is the first in a four-part series.

If you are receiving Long-Term Disability (LTD) benefits or if your Short-Term Disability (STD) or Long-Term Disability (LTD) benefits have been denied, you may be wondering whether you should apply for the Canada Emergency Response Benefit (CERB).  

In either case, it is important that you consider your eligibility for CERB before you apply and the possible consequences CERB may have on a disability claim and on your future finances. 

What if I am receiving LTD benefits and I want to apply for CERB?

LTD benefits are already a reduction from what you would have been earning if you were able to work. The monthly amount of LTD benefits are usually anywhere from 55% to 75% of what you were earning before you became disabled.  

You may be thinking that an additional $500 per week from CERB would be a welcome supplement to your LTD benefits and might bring your income closer to what you were earning before you stopped working. While this may be true, you will first need to consider whether you are actually eligible for the benefit and the consequences for your LTD claim and for your finances, if you do decide to apply for CERB.

What if my STD or LTD benefits have been denied and I want to apply for CERB?

If you were receiving STD or LTD benefits but your benefits have recently been denied, you may be thinking that CERB is exactly what you need to help bridge the gap in your income until you have successfully appealed or litigated the denial of your STD or LTD benefits or until you have returned to work. While CERB might in fact help you financially in the short-term, it is important to consider the longer-term consequences of applying for the benefit.  

If your STD or LTD benefits have been denied or terminated, we also encourage you to contact MK Disability Lawyers as soon as possible to determine whether you should appeal or start a lawsuit to dispute the denial or termination of your disability benefits. 

What do I need to consider before applying for CERB while I am on LTD or disputing my STD or LTD claim?

Whether you are still receiving LTD or whether your disability benefits have been denied, you are likely considering all possible sources of income to support yourself and your family. In considering your options and before applying for CERB, it is important to understand the answers to the following four questions:

  1. What is the purpose of CERB?
  2. Who is eligible to receive CERB?
  3. How will CERB affect my STD/LTD claim?
  4. What if I apply and I am not entitled to CERB?

What is the CERB benefit?

CERB provides Canadian workers over the age of 15 with up to $500 per week for up to 16 weeks if they have stopped working (7-14 days in a row) because of COVID-19.   

Some examples of reasons to stop working due to COVID-19, include:

  • Being laid off from your job or having your hours reduced to zero;
  • Being in quarantine or being sick due to COVID-19;
  • Caring for others who are in quarantine or sick because of COVID-19; or
  • Caring for children or others whose daycare has closed because of COVID-19.

Who is eligible for the CERB benefit?

The benefit is available to the following people:

  • Those who earned at least $5,000 in 2019 or in the 12 months before you applied;
  • Seasonal workers;
  • Those on Employment Insurance (EI) whose benefits will end between December 29, 2019 and October 3, 2020 and are not able to find a job due to COVID-19;
  • Employees;
  • Self-employed;
  • Contract workers;
  • Parents who were receiving EI parental benefits;
  • Those that applied for EI regular or EI sickness benefits after March 15, 2020; and
  • You can earn up to $1,000 per month and still be eligible for CERB.

It is not available to workers who quit their jobs. 

For more detailed information about the CERB benefit, please see the Service Canada or Steps to Justice website.

Can I apply for CERB if I am on STD or LTD?

If you are receiving STD or LTD benefits, then you are most likely not working due to an illness or injury rather than due to anything related to COVID-19 (such as those reasons listed above).  

You have likely been providing the insurance company (or the administrator of your benefits) with medical information to support your claim that you are disabled from your own or any occupation.  This means that you are claiming you are not able to perform the duties of your occupation and/or you are not able to be gainfully employed in any occupation due to an illness or injury.  On that basis, it is unlikely you would be eligible for CERB.  In other words, your disability benefits are already compensating you for your inability to work. 

If you do successfully apply for CERB, it is possible that the government, when it assesses CERB claims, will determine that you were not eligible because you were receiving STD/LTD and therefore, you must repay the CERB benefits that were paid to you.  If you have already spent the money and you are on a limited STD/LTD income, then it may be extremely difficult for you to repay CERB, at a later date.  

It is important that you also speak to your STD administrator or your LTD insurance company case manager to find out whether CERB would reduce your STD/LTD benefits. Based on the wording of most disability policies, it is unlikely that CERB would reduce your disability benefits, particularly if your STD/LTD claim is not based on a COVID-19 related disability. 

If you did stop working after becoming ill from COVID-19, you may be wondering whether to apply for STD and LTD through your employer’s group benefit plan OR apply for CERB or do both. Please see our upcoming blog article which will address that very question. 

Can I apply for CERB if my STD or LTD claim has been denied and I am still disabled?

If your STD or LTD benefits have been denied or terminated for whatever reason and you are not able to return to work, you should contact MK Disability Lawyers, immediately.  

In the meantime, you should also consider applying for CERB. If you have not yet received EI Sickness benefits for your most recent period of disability, you will likely be eligible for CERB. According to the government website, applications for EI Sickness benefits made after March 15, 2020, will be treated as CERB applications.   

However, you may have already received EI Sickness benefits for your period of disability. Sometimes, employers do not offer STD benefits or they only cover part of the period of disability leading up to LTD and expect the employee will apply for EI Sickness to bridge the gap to LTD. If you have already received EI Sickness benefits, and you remain disabled (for a non-COVID-19 related disability), then you might not be eligible for CERB. Keep in mind that if the government determines that you were not eligible for CERB, you will be required to repay the benefits at a later date.  

Can I apply for CERB if my STD or LTD claim has been denied and I want to return to work?

If your STD or LTD benefits have been denied or terminated and you believe you are able to work or you would like to try to return to work, you may not be able to. It’s possible you won’t be able to find a job due to COVID-19, or that your previous job is no longer available to you, or that your employer is not able to accommodate your limitations and restrictions. If any of those situations apply, then based on the eligibility requirements of CERB, you are likely entitled to the benefit and you should apply for it.

Keep in mind that if you are able to work and you do apply for CERB, it may be more difficult for you to dispute the denial of your benefits at a later date. The insurer may argue that the only reason you did not return to work is that work was not available and not because you continued to be disabled after they denied your claim. However, most disability insurance policies do allow you to return to work for a set period of time (usually six months under LTD policies) during which if you have to stop working due to the same or related disability, your claim continues where it left off.  

If you have questions about returning to work or applying for CERB after the insurer denies your benefits, we encourage you to contact MK Disability Lawyers to discuss your options. 

What if I apply for CERB and I am not eligible for the benefit?

The government is processing CERB applications very quickly and without any meaningful assessment of eligibility. Essentially, the government requires applicants to attest (which is like swearing or promising) that they qualify for the benefit based on the eligibility requirements on the government website.  

When applications are reviewed in more detail later on, the government might determine that you were not eligible for the benefit. If it turns out that you were not eligible for CERB, the government may ask you to repay the money. However, according to the government website, no interest will be charged on any money that you may have to pay back. 

If you are considering applying for STD/LTD or if your STD/LTD has been denied or terminated, or if you have any questions regarding the interplay between CERB and your disability benefits, we encourage you to contact MK Disability Lawyers to discuss your options. 

If you would like to discuss your Long-Term Disability claim with a lawyer, MK Disability Lawyers LLP are experienced lawyers dedicated exclusively to the practice of LTD litigation. We have represented disabled clients in various professions against all major life/health insurance companies in Canada. We would be happy to provide you with a free consultation.  

The preceding is not intended to be legal advice.  This blog is made available for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice.  By using this blog, you understand that there is no solicitor-client relationship between you and the blog publisher.  The blog should not be used as a substitute for competent legal advice from a licensed lawyer in your jurisdiction.  If your disability claim has been denied and you require legal advice, contact a lawyer specializing in disability law.