Legal Report by Milan Rada Esq., with John Hewson, Esq. As we approach the summer months, we often forget how rapidly these months seem to go by. All of a sudden it’s the fall, and before we know it, we are almost through 2017. A major topic of discussion throughout the end of last year and into this year has been the number of members planning on retiring. Of course, not everyone is retiring with a disability pension, and in fact, the vast majority of members do not retire with either an Accidental or Performance of Duty Disability Retirement pension. However, the question that we routinely discuss in our office is, “How many members think about any other benefits to which they might be entitled, in addition to their service retirement pension that they never even explored”?
We know that most members consult with a financial expert or a “numbers” expert before they make the decision to retire. Often that is the impetus for deciding the right time to go. Everyone needs to get their “ducks in a row.” This completely makes sense. However, how many of those financial experts are able to speak to the disability benefits that might be on the table at the same time of service retirement? Could any of them resurrect a Workers’ Compensation injury that is the main reason for the member retiring even though it is not an accident within the meaning of the Retirement and Social Security Law (RSSL)? Do they talk about Social Security Disability Insurance (SSDI) benefits or just the age-related benefits available at ages 62, 66, or 70? Fortunately, this is where we come into the picture.
In our seminars held at the PBA, Atlantic City (New York State Association of PBAs [formerly METRO]) and other venues, we have long advocated that members who are planning on retiring schedule a consultation with our office to discuss other benefits that can be just as beneficial as those proposed by a financial expert. In addition to a service pension, a member might also be able to supplement his monthly income with Workers’ Compensation benefits and/or SSDI benefits.
Workers’ Compensation benefits are most likely the benefits that most members fail to think about when it comes to taking a regular, service related pension. And it makes perfect sense as to why this is so. Most likely police officers retiring on a service pension ask themselves, “If I’m not retiring specifically due to an event or an injury, how could I possibly be entitled to get money from Workers’ Compensation, or get SSDI benefits?” This logic makes perfect sense if the scenario were that simple. However, most situations are not that black and white. For example, assume that a police officer has an old back injury from a work-related slip and fall in a police department parking lot or relieving point prior to signing in or before the start of his tour. This officer knew he could not retire on three-quarters tax-free or even one-half tax- free because he had already consulted with our office and, unfortunately, the timing of his accident would not qualify him as being “in service” as required by the RSSL in order to qualify for a 75% or 50% disability pension. Thus, he kept working only because he was able to fight through the pain, and because he did not yet qualify for his service retirement. During the next several years the member continued to get treatment from time to time under the Workers’ Compensation claim and missed a few days of work from time to time, using his line of duty number, but now he has enough years in the Retirement System so that he is able to retire on his service pension. Of course, part of the reason that the officer is not able to continue working is that the prior back injury simply has gotten worse over the course of the years. In this situation, since the reason for retirement is in part due to the back injury, this member might also be entitled to receive tax-free Workers’ Compensation payments on top of his pension. The most important consideration is that the process of service retirement be done properly and be supported by proper documentation and opinions from treating doctors. If an officer proceeds with service retirement incorrectly vis-a-vis an old, established Workers’ Compensation claim and thinks he can fix it after the fact, he will be sadly mistaken. Without following the proper procedure ahead of retirement, he will likely be found “voluntarily retired” from the labor market and, therefore, not entitled to ongoing payments from the old Workers’ Compensation claim. Right now, those Workers’ Compensation benefits might even total over $40,000 per year, tax- free on top of the service retirement pension.
More likely than not members are getting incomplete or no information from financial experts about SSDI benefits when the member retires with a service retirement. Of course, it is not the expert’s fault because it is not the benefit of which financial experts are most familiar. They can speak to how the numbers will look based on the guaranteed age-related benefits that someone will get when they achieve the age of 62 or their full retirement age. However, because SSDI benefits require the added factor of proving disability, most financial experts are simply not alerted to the implications or possibilities of SSDI benefits when their client tells them his intended plan on retiring from the police department is with a service retirement.
For starters, if a member has a post-retirement career planned, Social Security Disability is not on the table. SSDI entitlement involves an analysis of a person’s employability in the labor market as a whole, so if someone is working, even if no longer as a police officer, he will not qualify for the benefit. But consider a cop who has worked as a police officer for over 25 or 30 years. If that officer is in his 50s or early 60s and is not able to return to work in any capacity due to a physical or mental impairment, he would be an excellent candidate for SSDI despite retiring from the police department with a service retirement rather than a disability pension. Once again, YOU DO NOT NEED TO RETIRE DUE TO A DISABILITY IN ORDER TO QUALIFY FOR SOCIAL SECURITY DISABILITY INSURANCE BENEFITS! This is one of the major misconceptions about the benefit and something that people do not consider when they retire.
Therefore, if a 56-year-old retiring police officer starts contemplating retirement, he or she might not be considering that he might be an excellent candidate for SSDI benefits on top of his pension. Instead, he might be squeezing that pension each month, planning to take his Social Security at age 62 or even later. In the meantime, from age 56 to age 62 or age 66, this member might have enjoyed the benefit of getting his Social Security early because he was not employable in any other capacity. When added up, this could mean over $100,000 that the member has left on the table by not exploring the option of filing for SSDI prior to retirement.
As the weather improves, the public will become more and more active, and thus, the risks for police officers getting injured become greater. Please keep yourselves safe while you keep all of us safe. As always, it is our honor and privilege to represent police officers and their families in any legal matters that might arise. If you have any questions or concerns contact us anytime at 516-941-4403 or by e-mail at firstname.lastname@example.org.