How to work with an invalidity pension? (Translated from French)

Receiving a full or partial disability insurance (DI) pension does not always mean being unable to work. However, many people with disabilities or chronic illnesses have difficulty finding a job.

People receiving an IV pension face many challenges in their professional life: difficulties in finding a job adapted to their situation, potential evolution of the degree of work incapacity, reluctance of employers, discrimination… The labor market can therefore become a real obstacle course for people with illnesses or disabilities who wish to continue to work. Faced with these numerous difficulties, the services of an umbrella company are  a very interesting solution for these people. Here is everything you need to know about disability insurance pensions.

Who is entitled to a disability insurance pension?

The invalidity insurance grants a pension (for invalidity or incapacity to work) to insured persons who, due to an impairment of their health, are partially (at least 40%) or totally limited in their earning capacity or in the performance of their usual work. This health impairment must be of a lasting nature. It may be physical, psychological or mental in nature, or result from a congenital disability, illness or accident. The insured person can only claim an IV pension if his or her earning capacity or ability to perform his or her usual work cannot be restored, maintained or improved by reasonably required rehabilitation measures. He must also not have reached the legal retirement age.


The difference between incapacity for work and incapacity for earnings

An inability to work exists when an insured person can no longer perform his or her usual occupation or work due to a health impairment. The degree of incapacity for work is determined by a doctor. Inability to work, on the other hand, means that the insured person is no longer able to work in the labour market as a whole due to a health impairment. The degree of disability is determined by the IV office exclusively on the basis of the earning incapacity. These measures are applicable to ordinary employees as well as to self-employed persons on a freelance basis.


How can I combine a disability pension with a professional income in France?

The disability or incapacity pension can be combined with a professional income until the insured person retires, at the latest at the age of 67. Here is an example from France, but every country has its own regulations.

The combined amount of the disability pension and the professional income must not exceed 4 times the amount of the pension. In other words, the amount of income must not exceed 3 times the amount of the pension.

As for the pension for total and permanent disability and professional income, the amount of income should not exceed 2.4 times the amount of the pension. Thus, the amount of income must not exceed 1.4 times the amount of the pension.

And in the UK :

If you are getting certain disability payments you may be allowed to work or attend training and keep your payment. People getting Illness Benefit and Invalidity Pension cannot work (except for unpaid voluntary work). They must transfer to the Partial Capacity Benefit scheme if they wish to work.

If you are getting a means-tested payment, your income from work will be assessed in the means test. However, some of your income from work is not assessed.

The Department of Social Protection (DSP) has produced a Benefit of Work Estimator tool on for people getting Disability Allowance, Blind Pension, Invalidity Pension or Illness Benefit. This can help you to assess the financial consequences of taking up work or claiming Partial Capacity Benefit.

The umbrella company : a solution for workers with disabilities

Umbrella companies employ permanent employees, but they also hire ported employees. In order to overcome the discrimination suffered by beneficiaries of an invalid pension in the professional sphere and to encourage companies to solicit the skills of disabled workers, the French government has put in place new provisions. Since January 1, 2020, companies that are clients of disabled and ported workers in France can also benefit from a deduction of their AGEFIPH contribution. If the company has an employment rate of less than 3%, it can deduct a maximum of 30% of the cost of the service of the worker with a disability, up to a limit of 50% of the contribution. If the rate is higher than 3%, the limit is raised to 75%.

The services of an umbrella company thus presents many advantages for this fringe of active workers:

● They benefit from personalized support and training opportunities to increase their employability.

● Disabled workers are employees of the umbrella company. They therefore have access to all the advantages of employees of a traditional company: social security coverage, mutual insurance, contributions for retirement, unemployment…

● Contrary to the traditional employment market, it is much easier to find missions in wage portage. This formula also allows new self-employed people to create their activity while securing this launch thanks to the advantages of salaried employment.

● The portage company takes care of all the administrative paperwork for its ported employee. A not insignificant point that allows the freelancer to focus on the development of his turnover.

In the general belief, the status of freelance is rather precarious. Wage portage makes it possible to annihilate this fear by offering a secure framework to workers who are ill or in a handicap situation. Indeed, thanks to the various provisions put in place by the government, the freelance administration companies avoid long recruitment processes and benefit from immediately operational skills. This is a new opportunity to find a job while keeping a total freedom for the beneficiaries of an AI pension who are struggling to find a job.