Substantial Gainful Activity

What does substantial gainful activity mean (SGA)?  I get this question all the time, and it is difficult to answer without a lengthy explanation.  According to Social Security’s POMS (Program Operations Manual System) manual, SGA is defined as “the performance of significant physical or mental activities in work for pay or profit or in work of a type generally performed for pay or profit. Work may be substantial even if it is performed on a seasonal or part-time basis, or even if the individual does less, is paid less, or has less responsibility than in previous work.”

A person who is earning more than a certain monthly amount (net of impairment-related work expenses) is ordinarily considered to be engaging in SGA.  In 2013, the earnings amount threshold that SSA considers SGA is $1,040 ($1,740 for blind applicants).  This does not mean that if you earn less than the amount set by SSA, you automatically are working less than SGA level.  If you have the ability to work at SGA level, regardless of earnings, your claim may be denied.  For example, illegal activity can be considered to satisfy SGA.  In Dotson v. Shalala, 1 F.3d 571 (7th Cir. 1993), the claimant was supporting a $200-$300 per day heroin habit by stealing.  The Administrative Law Judge (ALJ) found that in order to steal he must “case” the area in which he has determined to steal the property. He must then plan on how he is going to steal the property and then actually steal it. During the month in which the hearing was held the claimant was stealing chainsaws. Lifting and carrying the chainsaws would also be significant physical activity. The planning and execution of the larceny entails significant mental activity. From these activities the claimant earns enough money to support his cocaine habit and provide him with other money in substantial amounts exceeding $200 to $300 a day. [Emphasis in original.]  Shalala, 1 F.3d at 574.  Similarly, volunteer work may be considered SGA if it is the type of work that others may receive earnings from.

On the other hand, high earnings doesn’t necessarily mean that the claimant was engaging in SGA.  For example, if he or she was working under special conditions that, but for the special conditions, the claimant would not have earned the amount they received.