What “Not Employable” Means for Discharged Veterans


Margot Lester

Today, we’re answering a question from reader Jake about qualifying for disability benefits after his discharge from the Army. He asks: “I was released from the Army with a disability of 80%. My orders state that I am Not Employable. What does that mean? I received a medical retirement.” We’ll walk you through the various kinds of disability benefits available to veterans below.

Free Veteran's Disability Evaluation

Need help securing VA disability benefits? Click here to speak with a nearby attorney for FREE about your claim.

“What Does Not Employable Mean?”

First, let’s look at the VA’s unemployability designation. Veterans who are unable to hold “sustainably gainful employment” may earn the “individual unemployability” designation because of these service-related disabilities:

  • A disability rated 60% or higher
  • Multiple disabilities with at least one rated at 40% or more and a total disability rating of at least 70%

This essentially means that your condition keeps you from earning enough to live on. This is why your orders stated you were not employable upon discharge from military service. The VA doesn’t count odd jobs and itinerant gigs as sustainably gainful employment when evaluating whether or not you meet enrollment requirements.

To qualify, you must be able to show that your service-connected disability is the sole reason you can’t get or keep a steady job. For example, you could show that your injuries prevent you from doing the physical tasks (like sitting at a desk, lifting or moving heavy objects, etc.) or mental processing tasks required for employment.

Is VA unemployability the same as 100% disability? Yes! Not employable veterans with the IU designation earn VA compensation at 100%. This is true even for veterans without service-connected disabilities at the 100% rating.

However, since you mentioned medical retirement, you may receive compensation through a different program: disability retirement.

What Is ‘Medical Retirement’ from the Military?

Now let’s consider medical or disability retirement. Outlined in Chapter 61 of the US Code, disability retirement is given to those who can no longer serve because of temporary or permanent disability received on active duty.

The Physical Evaluation Board (PEB), a group of active-duty physicians, reviews each case. In some instances, they may place you on the temporary disability retirement list for a period of no more than five years. During this time, you have regular assessments to help the PEB determine your fitness to return to service. Members who are unable to return to active duty because of a disability rated at 30% or higher are eligible for permanent disability retirement.

Compensation is determined by multiplying retired base pay by one of the following:

  • Percentage of disability assigned
  • Years of creditable service x 2.5%

Regardless of which method you choose, federal law caps the multiplier at 75%. For members on temporary disability retirement, the minimum is 50%.

We suggest you contact your local VA office or a VA-accredited attorney to review your not employable designation free of charge. You should verify what type of disability compensation you’re getting and ensure you’re receiving the maximum disability benefits you deserve. They can also look for other monthly benefits you may be due from the VA and the DoD.

Ready to see if you may qualify? Complete your free online veterans benefits evaluation now!

Margot Lester
CEO at The Word Factory | + posts

Margot Lester is the CEO of The Word Factory, a content marketing agency based in North Carolina that provides services for international healthcare brands, tech companies and SaaS developers. An award-winning business and brand journalist, she writes for daily and weekly newspapers and business journals, national magazines, in-flight publications and leading websites. Margot is also an in-demand writing coach and organizational communications trainer, helping individuals and teams write more effectively. LinkedIn: linkedin.com/in/margotlester.