ESA and PHI Claims

I am on Contribution based ESA and I am also in receipt of a PHI claim through my Employer. I declared the PHI claim to the benefits office at the beginning of my claim back in 2009/2010. I am still employed but unable to work.
Recently I read that having a PHI claim can reduce the ESA amount you receive. I contacted Benefits today and they advised me that I can only earn the first £85 p/w before they deduct the rest of the PHI claim benefit from my ESA, which would leave me with nothing.
I have to send Benefits proof of the PHI amount and they will get back to me. I am worried that they have been paying me ESA for 4 years when they shouldn’t have.
Does the fact that I am employed (but not working) still affect whether the PHI is deducted against the ESA? I pay Tax and NI on the PHI Claim amount.

Any help/advice would be appreciated. Thank you

Flowerpower wrote: I am on Contribution based ESA and I am also in receipt of a PHI claim through my Employer. I declared the PHI claim to the benefits office at the beginning of my claim back in 2009/2010. I am still employed but unable to work.
Recently I read that having a PHI claim can reduce the ESA amount you receive. I contacted Benefits today and they advised me that I can only earn the first £85 p/w before they deduct the rest of the PHI claim benefit from my ESA, which would leave me with nothing.
I have to send Benefits proof of the PHI amount and they will get back to me. I am worried that they have been paying me ESA for 4 years when they shouldn’t have.
Does the fact that I am employed (but not working) still affect whether the PHI is deducted against the ESA? I pay Tax and NI on the PHI Claim amount.

Any help/advice would be appreciated. Thank you

Hi Fp,

With regards to your PHI payments, for the purposes of CB ESA payments, PHI is treated much the same as income from an Occupational Pension. (OP)

See : ESA Regs 2008 72. (1) & (2) :

"Permanent health insurance.

72. (1) For the purposes of sections 2(1)(c) and 3 of the Act (deductions from contributory allowance) pension payment is to include a permanent health insurance payment.

(2) In this regulation “permanent health insurance payment” means any periodical payment arranged by an employer under an insurance policy providing benefits in connection with physical or mental illness or disability, in relation to a former employee on the termination of that person’s employment."

From :

www.legislation.gov.uk/uksi/2008/794/regulation/72/made

Therefore, unless you were migrated over from IB to ESA, and your PHI payments where previously disregarded, or you have been in receipt of PHI since 2001, the £85/Week disregard rule will apply much the same as if it was OP payments.

e.g. OP/PHI = £125/Week - £85 Disregard = £40/Week excess. 50% of this excess (£20) would be deducted from your weekly CB ESA payments.

If your PHI payments are in excess of the £85, and the DWP have not been making any deductions from your CB ESA, there may have been an overpayment which the DWP may try to claw back.

If you have proof that you have informed the DWP previously of the PHI payments, this may be beneficial.

In the mean time, I would advise that you provide all the information that the DWP have requested : Sending Documents to the DWP or ATOS

bro58

Hi Bro58, thank you for your quick reply.
Point (2) states
"in relation to a former employee on the termination of that person’s employment." But I am still employed by the company, I am not a former employee and my employment has not been terminated.

Does this make a difference?

Thanks for the additional information G !!

bro58

Flowerpower wrote: Hi Bro58, thank you for your quick reply.
Point (2) states
"in relation to a former employee on the termination of that person’s employment." But I am still employed by the company, I am not a former employee and my employment has not been terminated.

Does this make a difference?

Hi Fp,

I do not think that it does.

Are you sure that you are still classed as "Employed" by your employer ?

I know that PHI Schemes can differ, but the ones that I am aware of pay out when the employee's contract has been terminated, as it has been accepted by the employer's insurer that the employee can no longer work due to their medical conditions.

In the above scenario, the insurer would pay the premiums to the employer who would then administer the payment to the employee, this being the case, I do not think that the employee would still be classed as being "Employed".

You should also look into Gordon's advice, as it could be pertinent :

www.benefitsandwork.co.uk/forum?view=top...=10&id=101829#123930

bro58