Can an employee collect California disability benefits and also be paid sick, vacation or paid time off benefits by his or her employer?

California's state disability insurance (SDI) is a state-mandated, partial wage replacement program that provides short-term benefits to eligible California workers who suffer a loss of wages when they are unable to work due to a non-work-related illness or injury or are medically disabled due to pregnancy or childbirth. SDI is funded through employee payroll deductions and is administered through the California Employment Development Department (EDD).

Employer-provided vacation leave that is separate from sick leave and not in a combined paid-time-off (PTO) plan is not considered wages by the EDD. Vacation pay does not impact an employee's eligibility for SDI benefits.

When determining SDI eligibility, PTO payments are considered the same as sick-leave payments when employees are able to use PTO benefits for absences due to sickness or disability. SDI benefits are reduced by the amount of sick leave or PTO received, and an employee may be ineligible for SDI benefits depending on the amount of sick leave or PTO wages received and the employee's weekly benefit amount.

Integration or coordination of SDI benefits is a process in which the full SDI weekly benefit amount is paid to the employee, and the employee is also paid wages from the employer using the employee's available leave to cover the difference. With this process, an employee could receive up to 100 percent of his or her normal gross weekly wages for the benefit period. Employers must notify the EDD by telephone or mail if they choose to offer this option to employees.

See State Disability Insurance Frequently Asked Questions.