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Disability benefits overview for Tier One/Tier Two members

To be eligible to apply for disability retirement, you must be unable to perform any work for which you are qualified for a minimum of 90 consecutive days because of an injury or illness.

“Any work for which you are qualified” is not limited to the type of work you performed in your last job or in your usual field of employment. It means any type of job you are qualified to do.

Click on the topics below to learn more about disability retirement benefits.

Two types of disability benefits exist as follows:

  • Duty disability — If you are a PERS member and your PERS employment is the primary contributing cause of your disability, you may apply for disability retirement regardless of your length of service.
  • Nonduty disability — You must have 10 years of PERS service time to apply for disability not caused by a job. This period can include credit for the six-month waiting period to become a PERS member, and a partial year may be rounded up if more than half the year was worked. Also, if you were given credit for service time before your employer took part in PERS, those years would be included. PERS may consider up to 90 days of unused sick leave you had accumulated at the time you stopped working if your employer participates in the sick leave program. Contact Member Services to determine if you are eligible to apply for a nonduty disability.

If you apply and are approved for disability benefits, your benefit calculation uses the same PERS creditable service time you would have received had you worked until normal retirement age.

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If you meet the general requirements for disability, contact Member Services and request a disability retirement application.

Note: You cann​ot submit your application until you have stopped working.

Along with your application form, you will receive a document with frequently asked questions and answers about disability benefits and a fact sheet about returning to work.

If you expect to be disabled for at least 90 consecutive days, you can apply during the 90-day period; you need not wait until the 90-day requirement has been met.

You also can apply when on a paid leave, but disability payments cannot be made for any month in which you received salary or paid leave benefits from your employer, exclusive of a cash payoff of accrued vacation or compensatory time.

Once PERS receives your application, we will contact your doctor(s) to obtain information.

PERS staff also may request information from your employer, previous employers, workers’ compensation, or private insurance companies.

PERS staff and a medical advisor will review all of this information and make a recommendation to the PERS executive director, who acts on behalf of the PERS Board.

If your disability retirement is approved, you will receive an approval packet.

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The benefit payment process begins once you have submitted the required forms.

Your employer also has mandatory forms that PERS must receive before it can pay benefits.

Benefits are effective the first of the month following the last month in whic​h you receive salary from your employer (exclusive of vacation or compensatory pay​​offs).

No benefits can be paid until you have been physically off the job for 90 consecutive days.

After the 90-day period, however, benefits will be paid retroactively based on your effective retirement date if no salary was paid for that time.​

Payment options

You have the same choice of payment options as if you had applied for service retirement, except that you may not choose a lump-sum settlement option. Read about your options in our Tier One/Tier Two preretirement guide.

You have 60 days from the date of the first benefit payment to change your option.

The option you choose will apply only to the time you are receiving disability retirement benefits.

If you are no longer disabled and your disability payments stop, you must then select a retirement option when you later apply for service retirement.

If you continue to be eligible for disability retirement until you reach normal retirement age , your disability retirement will continue for life under the option selected, even if you later cease to be disabled, unless you return to PERS-qualifying employment.

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If you qualify for disability retirement, you are guaranteed a minimum benefit of $100 per month, as computed under retirement Option 1.

Benefit Option 1 is paid for your lifetime. It provides you with the highest monthly benefit. No benefit of any kind is paid to anyone after you die.

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Oregon law* allows a member who received a PERS disability retirement benefit or workers’ compensation benefit under after January 1, 1985, to receive service retirement credit for that period if the member returns to employment with a PERS-participating employer after the period of disability and subsequently applies for a service retirement.

If your disability was caused by a job-related injury or illness, the cost of the additional retirement service credit is charged to your employer at the time of injury.

If you received workers’ compensation benefits, you must request this service time in writing and provide proof of your approved claim.

If you wish to restore creditable service for the period of disability, and your disability was not caused by your job, you must pay the full cost of the anticipated lifetime monthly benefit increase. This purchase is available when no other creditable service time has been given for that time period. The full cost, whether paid by your employer or you, only restores service time. No funds are placed in your account.

*Oregon Revised Statute Chapter 656

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PERS is required, by​ law, to perform periodic reviews of your continued eligibility for benefits until you reach normal retirement age.

PERS also will contact the Oregon Employment Department to determine if you are working and may request a copy of your annual tax returns.

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If you return to work in any capacity, you must notify PERS of the date and place of employment within 30 days. Your benefit may be reduced by earned income.

To learn more about the circumstances in which you can work and still receive disability retirement benefits, read the Disability retirement work income guidelines for Tier One/Tier Two members​ w​ebpage.

However, if your return to work in a full-time PERS-qualifying position, your disability benefits will be stopped.

Your disability benefits also will stop if you recover from your disability before reaching normal retirement age.

If your benefits are stopped, your PERS member account will be adjusted to show the same balance that was there when your disability first became effective (your effective date for disability retirement).

You will not receive creditable service time when receiving disability benefits. However, if you return to work with a PERS-participating employer, your service time may be restored if you or your employer pays the full cost to purchase your disability time.

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Disability retirement benefits for Tier Two members may be offset by any total disability (temporary or permanent) payments from workers’ compensation.

The offset will be the amount by which the two monthly payments together exceed your monthly salary at the time of disability.

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Need to cancel your disability retirement claim?

If you have applied for disability retirement but need to cancel your claim, submit a Cancellation of Application for Disability Benefits form to PERS.

Do you have additional questions about disability retirement benefits?

Read the Tier One/Tier Two disability retirement FAQ webpage.