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Wondering if you can earn money while receiving long term disability benefits in Ontario? The answer depends on your insurance policy and the type of work you do. Disability insurance policies often include clear rules about working while receiving LTD benefits, and your decisions may affect ongoing disability payments. Read on for everything you need to know about employment options while on long term disability benefits, including guidance on what to do next if your health changes, from the legal professionals at Share Lawyers.
Can You Work While on Long Term Disability Ontario?
If you’re receiving long term disability benefits from an employer or through a private insurance policy, you may be able to work in some special circumstances.
But you must be careful: working in any capacity could affect your disability payments or even cause your benefits to stop—especially if you earn too much, or take a job that makes your insurer believe that you’re no longer disabled under your policy.
While some policies allow for part-time or less demanding work while on long term disability, every insurance policy is different. If you earn too much or your ability to do this work shows you’re not disabled, your benefits could be reduced or stopped. Always check your policy before making any employment changes.
How Do Disability Benefits Work in Ontario?
Long term disability benefits from an employer or private insurance policy are a key financial safety net if you become too sick or injured to work. Here’s how they typically work:
Eligibility: To qualify, you must meet your policy’s definition of disability—usually meaning you can’t do the main duties of your own job for the first two years, and after that, any job you’re suited for by education, experience or training. Medical evidence supporting this claim is essential.
Income Replacement: If approved, you’ll receive a portion of your income as disability payments.
Duration: Many policies pay until age 65 or for a set period, as long as you remain disabled under the terms of your policy.
Important: Review your employee benefits booklet or insurance contract for precise definitions, waiting periods, and conditions that affect your claim.
What to Consider Before Working While on LTD
Always speak to your doctor first and get their opinion in writing.
Notify your insurer of any change in your work status immediately.
Keep written records of all discussions with your doctor, insurer, and employer.
Understand how returning to work may change the calculations for your disability benefits.
Insurance Policies: Rules & Limitations
Each disability insurance policy has its own terms about working while on claim. The main two types:
“Own Occupation” Coverage
You are considered disabled if you can’t do your own job, even if you could work elsewhere in a different type of employment.
During this period (usually the first 24 months), you often have more employment options.
You may be able to work in a different occupation or reduced capacity and still receive some benefits, provided you don’t exceed the income cap.
“Any Occupation” Coverage
After the “own occupation” period, most policies shift to “any occupation”, meaning you’re only considered disabled if you cannot work any job you’re reasonably suited for. The job also has to be one that you’re suited for by education, experience or training.
If you return to any paid work, your insurer may try to stop your benefits.
Additional Policy Rules
Policy Feature | Typical Rules |
Partial disability | Allows some work and partial disability payments |
Income threshold | Most set a percentage of previous income as the limit |
Reporting obligations | You must report any new work and earning money to your insurer |
Rehabilitation incentives | Some policies encourage gradual return to work with income supplements. This can backfire by the insurance company then cutting you off and saying you can work. |
Remember: Every insurance policy is different. Always read your contract, and contact a lawyer if you’re unsure what’s allowed.
Your Employment Options on LTD Benefits
If you’re receiving long term disability benefits, you may have several employment options depending on your health, your policy, and what your doctor recommends:
Part-time work: Some policies let you work part-time while collecting partial disability payments.
Modified duties or “Graduated Return”: Returning gradually to work with modified tasks is often supported, as long as you have your doctor and insurer’s approval.
Different Job: Under “own occupation” coverage, you may be able to work a job completely different from your old role, but only up to certain earning limits.
Not working at all: If your health does not support any work, focus on recovery and maintain strong documentation. A return to work is always possible in the future.
Partial Disability Benefits & Rehabilitation Incentives
Many group and private disability insurance contracts include partial disability benefits and rehabilitation incentives, designed to support your safe return to the workforce.
What Are Partial Disability Benefits?
If you can go back to work in a limited way, some policies pay you a portion of your income to make up for lost wages. For example, if you can only work 50% of your regular hours, your LTD payments are reduced based on your earnings, not eliminated.
Rehabilitation Incentives
Insurers often promote gradual returns, including:
Trial work periods: Letting you test the job with continued benefits if things don’t work out.
Vocational rehab programs: Training and support to help you try new positions or adapt to work with your disability.
Earning limits: If your new income stays under a specific threshold (usually defined as less than 20%-30% of your prior pay), you can often keep your full disability benefits.
Check your insurance policy for these supports. If not offered, consider talking to your lawyer about advocating for these accommodations.
Ayesha’s Story: Navigating Health, Work, and Disability Benefits
Meet Ayesha, a 42-year-old personal support worker from Alberta. She has always been passionate about her work, caring for her senior clients with empathy and dedication. After a severe head injury, Ayesha’s health declined. She couldn’t keep up with her duties and worried about how she’d manage if she stopped working entirely.
Ayesha thought about cutting back to part-time hours but was worried:
Would earning money put her disability payments at risk?
Would working affect her recovery?
What if her insurer stopped her disability benefits?
What should Ayesha do next?
Talk to her doctor: She should discuss her symptoms, treatment, and ability to work. If her doctor agrees she cannot work full-time, she should get a medical note.
Review her insurance policy: Ayesha needs to read her employer’s disability insurance policy. She should look for sections about working while on claim, partial or rehab benefits, and earning limits.
File an application for long term disability benefits: Before reducing hours or stopping work, Ayesha should submit the necessary application forms to her insurance provider.
Notify her employer properly: With support from her doctor, Ayesha should provide a note explaining her need for medical leave.
Ask about modified duties: She can explore whether her workplace offers alternate tasks matching her restrictions.
Keep detailed records: Track all medical appointments, communications with the insurer, and decisions made.
Talk to the disability lawyers at Share Lawyers: Consulting a lawyer who handles long term disability claims can help Ayesha understand her rights, clarify policy terms, and avoid mistakes that might jeopardize her benefits. This support can be crucial, especially if her claim is denied, or if she feels pressured by the insurer or employer to return to work too soon.
How to Apply for Disability Benefits
Applying for long term disability benefits can feel overwhelming, but our step-by-step guide can help you feel secure and confident moving forward:
Read Your Policy: Understand your eligibility criteria, how disability is defined, and deadlines.
Consult Your Doctor: Make sure your physician agrees with your need for leave and supports your application.
Gather Medical Documents: Collect full medical records, test results, and any specialists’ letters.
Complete Application Forms: Fill out all sections accurately—yours, your employer’s, and your doctor’s.
Submit to Insurer: Send application forms and supporting documents as directed. Keep copies of everything.
Follow Up: Check in regularly with your insurer. Document these interactions to protect your rights.
Respond Promptly: If the insurer asks for additional information or assessments, answer quickly and completely.
Read more on applying for disability benefits: How to Get Disability Benefits in Canada: Your Guide
Why You Need a Long Term Disability Claim Lawyer
Navigating disability insurance claims can be confusing and stressful. Here’s how the disability claim lawyers at Share Lawyers can assist:
Advocacy: Standing up to insurers who deny, cut off, or delay your disability benefits.
Guidance: Explaining your employment options, income thresholds, and appeal alternatives when facing denial.
Peace of Mind: Allowing you to focus on recovery while they handle complex paperwork and negotiations.
Note: If your claim is denied, disability lawyers do not generally recommend “appealing” through the insurer’s own channels. Instead, they pursue more effective ways to fight for your rights.
Frequently Asked Questions
Can you work part-time while on long term disability in Ontario?
Sometimes, yes—but income limits apply. Your specific insurance policy will set out how much and under what conditions you can work while still receiving disability benefits.
If I take a job with lower wages, will I keep my benefits?
Typically, if you earn less than a set percentage of your prior income, you might still qualify for full or partial benefits. Exceeding that amount may trigger reductions or end your payments.
What if my employer offers “modified duties”?
You may be able to try modified work without losing your benefits, but you must have clear medical support and approval from your insurer. Keep a record of all communication.
Tip: Always seek legal advice before returning to work or accepting money while on long term disability. Complex rules can put your financial stability at risk.
If you have questions about your long term disability benefits or need advice tailored to your unique situation, don’t hesitate to reach out to Share Lawyers. Our dedicated team is here to guide you through each step, ensure you understand your rights, and help protect your financial future. Contact us today for a compassionate, no-obligation consultation and get the support you deserve.
