How Does An Employee’s SDI Claim Affect The Employer?

Occasionally, I’ll get a question from a client of mine who has received a notice from the Employment Development Department (EDD) of California that a State Disability Insurance (SDI) payment has been paid out to his or her employee.

My client, the employer, is curious because his or her employee receiving the SDI payments is typically also out on injury, collecting  workers comp payments.

Usually my client has two questions upon review of this paperwork:

1. What is this?
2. Does this affect me in some way?

And by “affect me” my client is asking if they are going to have to pay more  taxes, if their workers comp rates are going up, if they are going to get fined and/or if they’re in trouble for some reason.

Before I answer the questions, let’s get the background information together.

#1: What Is SDI?

SDI is a state-sponsored insurance that pays when an employee suffers an injury or illness that is NOT caused by or related to work. Exceptions apply: read on.

So let’s answer the questions.

What is This?

This is a notice that your injured employee has filed a claim with SDI.

The reason an injured employee who is already receiving workers comp benefits would also file an SDI claim is because workers in some situations can receive payments from both workers comp and SDI at the same time.

What are those situations?

• Workers comp payments are denied (or the claim is pending potential denial)
• Workers comp payments are delayed
• Workers comp payments are less than what the injured workers could be receiving in SDI

#2: Does this affect me in some way?

This is the good news.

• No, it does not affect you.
• No, you are not in trouble.
• No, you’re not getting fined.
• No, you do not pay for SDI – your employee does through their own payroll contributions.
• No, your workers comp rates aren’t going up for this. Truthfully, they may potentially go up because of the claim itself, but not because of SDI payments.

What has happened is your employee – or your employee’s lawyer – knows the system and is getting the most out of it. They are taking the two-pronged attack: workers comp and SDI. It doesn’t hurt to file the claim, so why not?

If you want to know more about SDI, you can go to the EDD’s site and learn all about it.  Here are a couple of links that can help:

http://www.edd.ca.gov/Disability/FAQ_DI_Workers_Compensation.htm

http://www.edd.ca.gov/Disability/FAQ_DI_Eligibility.htm

 

AND LASTLY, if you’re looking to save money on your workers comp, please click on the “Schedule a Call” or “Send Email” button below.

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