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Understanding Substantial Gainful Activity - Questions & Answers - 2011
QUESTION: I hear a lot about substantial gainful activity or SGA. What does this phrase mean exactly and why is it important?
The Social Security Administration defines “substantial gainful activity” or SGA as the performance of significant physical and/or mental activities in work for pay or profit, or in work of a type generally performed for pay or profit, regardless of the legality of the work. Within the context of this definition, each of the following words or phrases has a specific meaning:
- “Significant activities” are useful in the accomplishment of a job or the operation of a business, and have economic value.
- Work may be considered “substantial” even if it is performed on a part-time basis, or even if the individual does less, is paid less, or has less responsibility than in previous work.
- Work activity is “gainful” if it is the kind of work usually done for pay, whether in cash or in kind, or for profit, whether or not a profit is realized.
Activities involving self-care, household tasks, unpaid training, hobbies, therapy, school attendance, clubs, social programs, etc., are not generally considered to be SGA. Income that is not wages or net earnings from self-employment (NESE) would also not be considered in SGA determinations.
SGA is a critical concept because a person’s ability to work at a substantial level is directly related to whether or not SSA considers them to be “disabled”. Social Security defines disability as “the inability to engage in any SGA by reason of any medically determinable physical and/or mental impairment which can be expected to result in death, or has lasted or can be expected to last for a continuous period of not less than 12 months”. To meet the definition of disability, an individual must have a physical or mental impairment or impairments of such severity that the individual is not only unable to do his or her previous work but cannot, considering his or her age, education, and work experience, engage in any other kind of substantial gainful work which exists in the national economy.
SSA considers an individuals ability to engage in SGA at the time of initial application for both SSI and DI applicants. Substantial gainful activity remains relevant for a title II disability beneficiary as long as an individual continues to be on disability benefits. When a DI beneficiary demonstrates the ability to engage in SGA, SSA considers the person to no longer be disabled and benefits are generally terminated.
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