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How Are Loss of Earnings Calculated After an Injury?

Posted on October 16, 2020 in Car Accident,Personal Injury

An accident can affect a victim in many negative ways, including removing the ability to earn a living wage. Work interruptions for medical treatments or due to a permanent disability could make an already difficult time worse by putting more financial pressure on a family. Knowing how to calculate loss of earnings during a personal injury claim can ensure you seek maximum compensation for your past and future lost wages.

What Are Lost Wages?

In a personal injury law context, lost earnings are a type of economic damage award. Since the goal of filing a personal injury lawsuit is to be made whole again through financial compensation from the defendant, you will need to claim your lost wages as part of the effects of your injury. During a personal injury claim, lost wages refer to all the money you lost from having to miss work. It reflects the personal losses you suffered from taking unpaid time off of work or having to use paid time off or vacation time. If you did not cause your injury or accident, you should not have to pay for lost wages on your own. Instead, the defendant should owe you compensation through last wage replacement.

Calculating a Short-Term Loss of Earnings

Some personal injury claims involve temporary lost wages while a plaintiff recovers from his or her injury, while others seek long-term loss-of-earnings compensation for permanent disabilities that prevent the plaintiff from ever returning to work. If your doctor believes you will be able to return to work once you heal from your injuries, you will need to seek short-term wage replacement to help you afford your living expenses in the meantime.

You will need to estimate how much you reasonably would have earned during your recovery period if your injury had not happened. This requires taking amounts from your past earnings and projecting them through your point of maximum medical recovery. You or a personal injury lawyer can add up all the earnings you most likely would have made during the period your doctor says you will need to recover.

Before the courts will grant you an award for temporary lost earnings, you or your lawyer will need to provide reliable evidence of how much you made before the accident. Common forms of evidence are pay stubs, income statements, invoices and letters from your employer. If you are self-employed and do not have a regular pay schedule, you may need to provide your bank statements, tax return documents and other records to present a complete picture of your temporary lost earnings.

Long-Term Wage Replacement Involves More Complex Questions

It can be even more difficult to estimate your losses if a doctor says your injury will prevent you from ever returning to work. Calculating long-term wage replacement takes examining your injuries and how they impact your ability to earn a living wage. If your injury prevents you from returning to your old job, but not from taking a new job, you will calculate the difference in earnings between what you used to make and what you make now.

If someone else’s negligence gave you a permanent injury that takes away your ability to perform any type of work, you will estimate a lifetime of lost wages. Your attorney can help you with this calculation. An accident lawyer may use your past pay stubs, annual salary or hourly rates to estimate how much you most likely would have made. Then, your lawyer can demand this amount in compensation from the defendant on your behalf.

Factors such as your age at the time of your injury, how many years you were likely to continue earning a full income, anticipated promotions and wage increases, allowances for inflation, and adjustments for your continued capacity to earn can affect how much you receive for loss of earnings after an injury. For assistance calculating a fair last wage amount during an injury claim in Las Vegas, contact Claggett & Sykes Law Firm for a free consultation.