What Amazon Employees Need to Know About Disability Benefits After the 2025 Layoffs

In October 2025, Amazon initiated massive workforce reductions, laying off over 30,000 corporate employees, the majority of which — but not all — are located in Washington state. Amazon also has a significant white collar employee presence in New York, Texas, Virginia, Boston, Colorado, Tennessee, North Carolina, Georgia, Indiana, California, Arizona, and Florida.

For employees affected by these layoffs, it’s crucial to understand your rights under the Employee Retirement Income Security Act of 1974 (ERISA), especially concerning disability benefits. ERISA provides protections for employees participating in employer-sponsored benefit plans, including the right to appeal denied claims and to file lawsuits for wrongful denial of benefits.  Amazon employees need to understand that if they can demonstrate they were disabled before their last day of work, they are covered under Amazon’s short and long term disability plans even if they have already left Amazon or been notified of termination.

Many workers have health issues that are significant enough to qualify as a disability, but the workers push through them because they love their career, or need the money, or both.  The fact that you worked while disabled does not disqualify you from making a claim now, it simply demonstrates your commitment to working and the effort you exerted to keep your employment as long as you could.

The Amazon Short and Long Term Disability Plans

Amazon’s short term disability plan is administered by Amazon’s Disability Leave Services, while the long term disability plan is administered by The Hartford Insurance Company.  Amazon pays the benefits for the short term disability, while The Hartford pays long term disability.

Under the short term disability plan, employees can receive up to 180 days of paid leave after a one-week elimination period.  Amazon pays 60% of your basic salary during this time, with a cap of $9,966.67 per month.  Amazon will require you to apply for any state disability benefits available to you, and that amount  will be offset, or deducted, from what Amazon pays.  The short term disability plan offers two levels of appeals, the insured has 180 days to make the first appeal, and if that is denied, 90 days to make the second level appeal.

The long term disability plan takes over at 26 weeks.  To qualify for benefits under the long term disability (“LTD”) plan, employees must be able to demonstrate that they were disabled throughout the “elimination period,” which is 180 days, and ties to the 180 days of the short term disability  policy. The Plan pays 60% of the employee’s monthly predisability earnings up to $25,000 per month. Benefits are potentially paid up to age 67. The Hartford may require you to apply for Social Security Disability Insurance benefits and offset them against what they owe you.

“Predisability earnings” is a defined term.  It means the employee’s gross monthly earnings at the time the employee became disabled. It includes sign-on bonuses, shift differential, incentive pay, and RSUs paid for the 12 month period prior to the last day you were actively at work before you became disabled.  This means that The Hartford is supposed to include all stock vested in the 12 months prior to your disability, as well as your bonuses paid, when calculating your annual salary, and then divide it all by 12 to determine your monthly gross earnings.  However, The Hartford does not make an effort to collect this information, so unless you review their calculation and confirm its accuracy, you could be significantly underpaid.

For the first 24 months of long term disability, the employee has to prove the inability to perform the material and substantial duties of their “own occupation.”  After 24 months the employee must demonstrate the inability to perform the duties of any gainful occupation for which the employee is reasonable fitted by education, training or experience and which must pay the greater of at least 80% of your predisability earnings, or the maximum monthly benefit under the policy.

The long term disability plan includes limitations of 24 months of coverage for any disability related to Mental Health or Substance Abuse.

What do you need to demonstrate disability, especially if you were working full time at the same time you are claiming disability? You need to demonstrate that your treating physician agrees that you had restrictions and limitations that kept you from performing the materials duties of your own occupation as of your last day of work, and you have to have been treating for the symptoms causing those restrictions and limitations as of your last day of work. Under the Amazon Short and Long Term Disability Plans, you need to demonstrate “regular” treatment by a medical professional for the condition that keeps you from working.

Courts understand that many people push through disability and try to work anyway because they love their job, or they need the income, or both and have routinely held that the fact that an employee was working does not bar them from claiming disability at the same time.  Employees can also make claims for disabilities that arose after they learned of the termination of their position but before their last day, if they have medical support.  That includes depression and anxiety, if an employee is diagnosed with and actively treating for such a condition before their last day of work.

The Amazon Severance Agreement

If you are laid off by Amazon, Amazon will require you to sign an agreement to obtain a severance package. If you have any intention of making a disability claim under the Amazon policy, or if you already are on disability at the time of the layoff, it is important to have an attorney review your severance agreement prior to signing it. Most employees do not realize that depending on the language used in the agreement, a court may interpret it to waive your right to pursue disability benefits. The severance agreement will include a section releasing your claims against Amazon. Amazon will be a defined term involving “Released Parties” or “Releasees.” If that definition includes Amazon’s insurers, then a court may decide that you released your claims against The Hartford as well. If the claims released includes claims under ERISA, a court could decide that you released your claims for disability benefits, which are governed by ERISA. It is important to have counsel review this for you before you sign. There is nothing your counsel can do for you after you sign it. If you consult with counsel before signing, it may be possible to request specific language to be included based on any current or pending disability claim, and to carve that claim out of any waiver.>

All Amazon Employees Can and Should Pursue Their ERISA Disability Insurance Claims in Washington Courts

Both the Amazon short and long term disability plans are governed by ERISA. The Hartford routinely denies many disability claims, especially those involving mental health or “self-reported” symptoms such as pain, migraines, or fatigue.  Insureds are required under ERISA to appeal a denial, but after one appeal, there is no further option for reconsideration under the long term disability plan. The next step is litigation.  The Hartford, like most insurers, is often interested in buying out the value of the insured’s claim at litigation. This enables some insureds to obtain a lump sum settlement. The Hartford looks at the total claim and the litigation, including the court where the litigation is filed and the judge assigned, when making determinations about settlement.

While under ERISA an insured can technically bring suit anywhere in the US, The Hartford will push back on most suits if there is not a specific connection, arguing successfully that the court should not bear the cost of the litigation without a clear connection. Under ERISA, there are three locations where the insurer cannot dispute the venue of the lawsuit – if it is filed where The Hartford is headquartered, if it is filed where the insured lives, or if it is filed where the disability plan is administered.  Amazon administers the Plans in the Western District of Washington in the Ninth Circuit.  This is arguably one of the most favorable districts in the country for disabled plaintiffs.

Many insurers include language in their disability policies that grant them “discretion” in deciding claims. Courts interpret that language to mean that the court must accept the insurer’s decision unless it is clearly “arbitrary and capricious.” The Amazon policies include this language.  But discretionary clauses have been banned in Washington state and are not enforceable, and courts have uniformly held in the Western District of Washington that the ban applies to the Amazon disability policies. That means that the court will consider the claim objectively on its merits, rather than giving The Hartford the benefit of the doubt.

Washington state also embraces the doctrine of notice prejudice.  This means that unless the insurer can demonstrate actual prejudice from a late-filed claim, the insurer must accept and consider that claim.  Many states will allow an insurer to deny a claim as late-filed automatically. Where insureds often do not have a diagnosis for medical issues in a timely period and only receive a diagnosis after they leave employment, insurers in many states have been able to avoid responsibility for those diagnoses by pointing to the fact that they were late-filed.  When suit is filed in Washington, the insurer cannot escape its responsibility for the claim even if it is filed late.

If you are an Amazon employee in a state other than Washington, you can still file suit in Washington and take advantage of the more favorable laws and courts for your litigation – if you have an attorney admitted to the Washington bar.

What Do You Need to Make a Late-Filed Claim?

For any claim, the support of your treating physician is paramount.  You cannot make a successful disability if your doctor or therapist does not believe that you are disabled.  Your treating physician does not need to be a medical doctor. Under the Plans, you need to be seeing a “legally qualified medical practitioner according to the laws and regulations of the governing jurisdiction.”  Washington recognizes naturopaths and therapists as legally qualified medical practitioners. That practitioner cannot be an immediate relative or spouse. If you are an Amazon employee who has received notice of termination but you are still employed, a claim will not be considered late-filed.  If your doctor agrees that as of your last day of work you had restrictions and limitations, whether mental or physical, that precluded you from performing the material duties of your job, you can apply for disability benefits at Amazon.

If you are making a claim after you have already left work, you need to demonstrate that you were treating for the symptoms that disabled you on or prior to your last day of work. You do not need to show a diagnosis, but you do need to demonstrate that you were experiencing symptoms of the disability and that you sought treatment for those symptoms, so medical records need to show treatment.  Your treating medical practitioner will also have to be willing to complete paperwork confirming your disability and that it began on or prior to your last day of work.  With that information, The Hartford will be required to accept and review your claim even if you last worked at Amazon months or even years ago.

Obtaining Legal Counsel During the Appeal 

Many insureds appeal the denial of their benefits themselves.  The problem with that is, if the appeal is denied and litigation is required, your attorney will not be able to improve your position.  Under ERISA, there is usually no discovery in litigation. A judge rules on the claim, and the judge is limited to the information in the claim file. That means that the appeal is the insured’s only chance to get all information into the file that would benefit the judge. This includes declarations under penalty of perjury from witnesses, additional medical records, letters from the treating physicians, independent testing to support the disability, issues with The Hartford’s doctors, and medical literature to educate the judge about the insured’s disability and diagnosis.  The appeal isn’t just for The Hartford- it is the insured’s one chance to strengthen the file for litigation.

An appeal within 180 days of denial is required.  The insured cannot bring suit if there is no appeal and cannot appeal again or refile the claim.  As soon as a denial is received, an insured should contact counsel for assistance to give counsel time to perfect your appeal.

Where Monahan Tucker Law has attorneys and offices in Washington, California, Arizona, Oregon, Nevada and Pennsylvania, it can assist Amazon employees anywhere in the country and if necessary bring suit for its clients in the Western District of Washington, because our attorneys are admitted to the court.  We have deep and broad experience with the Amazon disability policies and with The Hartford, and can help you through this difficult and stressful time and provide you the strongest tactical advantages in your claim or litigation.