Short-term Disability definition

Short-term disability is an insurance product that pays a percentage of an employee’s salary, for a specific period of time, if the employee is unable to perform all or some part of their job. Between 50 percent and 70 percent of the salary is typically offered, along with some short-term disability benefits.

Some policies require people to use sick days before the coverage begins (often between one and 14 days after the injury/sickness is first discovered), particularly if the disability or illness is longer-term. Policies will often break coverage down between injury and sickness, because the latter will tend to keep employees out of work for a shorter period of time.

Short-term disability cover can be paid by either the employer or the employee and can be self-funded, typically in the case of larger employers. It may only be offered to full-time employees or those that have worked for the employer for a specific period of time, such as two years.