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STD Benefits: Requirements for Coverage

When an employee is temporarily disabled and is unable to work, a short term disability (STD) benefit may be availed of. It pays a portion of current salary for a short period in case of injury sickness or disability.

An employee is usually benefitted an amount between 50 and 70 percent of salary. For big companies, the typical pay is 100 percent of the salary. Usually, the benefit is a percentage of gross salary without commissions, bonuses and overtime.

Usually, a short-term disability plans give benefits for up to 26 weeks. The period varies depending on the state and the type of coverage. Further, employers time the STD plan to include the waiting period of the long term disability coverage.

While states have their own laws relating to short-term disability, no federal law exists that requires employers from offering disability benefits to their employees.

Filing STD Claims

For larger companies, STD claims are processed internally to prevent completion of paper works beyond a statement from the physician.

Other companies buy STD coverage from insurance companies that handle the claims similar to any other disability benefits provider. The plan document usually provide for the manner of filing claims.

Among states’ mandated plans, California has the most generous STD benefits. An employee is provided with a benefit of 55% of his salary with a maximum of $728 per week. Benefits are paid after one week of waiting period and 52 weeks thereafter.

STD Coverage Payment

A short term disability may be an employer or employee paid benefit. In most cases, the coverage is employer-paid. However, employers may choose to let employees pay for the coverage with tax implications.

Short term disability coverage can be attained in the following manner:

  • Agreement with the insurer which covers disability
  • Self-funded coverage directly set aside by the employer

Terms and Conditions

For employees on short term disability, an employer may require the former to use sick days before availing STD benefits. An employer may also require documentation from a physician.

Generally, the terms for qualification are as follows:

  • Employee has worked for a certain amount of time
  • Employee works full time or 30 hours or more

When disability persists, a long term disability program may be availed of after the period of the short term disability ends.

For employees who want to make use of this benefit, an employment lawyer may be consulted. A short term disability attorney can assist an employee in filing a claim pursuant to the coverage.

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