Personal Injury Economic Damages Claims: Lost of Wage & Earning Capacity
Economic damages in a personal injury case include more than just the cost of medical care. If you’re injured, you may not be able to work, or you may lose your future earning capacity. If you don’t know how to calculate these costs, or if you’re unaware of how to document these costs, you can end up missing out on a settlement that can actively help you cover your living expenses.
Understanding Lost Wages, Benefits, and Earning Capacity
Lost wages and earning capacity refers to all the earnings that you miss out on due to a personal injury. This includes not just wages, bonuses, overtime, and health insurance but also what you would have made had you been able to continue on the career path you were on.
For example, if you were on a construction crew in line to be foreman within a year and you permanently injure your leg, you may not be able to take the foreman job. A personal injury attorney in Florida will factor in the wages and benefits that you made as a crew member as well as the wages and salaries that you would have had as a foreman.
Please note that lost wages and earnings does not cover associated costs with the temporary or permanent loss of your job.So, if you needed to hire a full-time nanny to care for your kids while you recovered, this is defined as other out-of-pocket expenses rather than lost wages.
Lost Wages for the Self-Employed
Self-employed people, whether you work in the gig economy or own your own business, are typically calculated via lost opportunities. So, if you were consistently receiving 3 – 5 major contracts every six months, an attorney would base their calculations based on the income of the contracts.
Documentation for Lost Wages
If you want to win your personal injury case, it starts with having all the documentation for lost wages you need to prove your case. Decision-makers rely on expert testimonies, pay stubs, tax returns, profit and loss statements, and client contracts to understand a person’s earning potential.
How It’s Calculated
There are certain cases that are easy to calculate. For example, let’s say that you sustained an arm break in a car accident. During the time your arm is in a cast, you are unable to work your regular job as a warehouse clerk, and your company is unable to accommodate your requests for desk work. Once your arm is fully healed, your mobility is fully restored and you’re able to return to work after two months.
In this case, the judge would simply multiply how much your average monthly earnings and award this amount as a part of your personal injury claim in Florida. If there are extenuating circumstances, such as the overtime that you would have made during the busy holiday season, the judge may also factor in the purported additional earnings for the seasonal work. If you’re a salaried employee, a judge will divide your annual salary by the workdays in a year and then multiply that number by how many days you missed.
Decision-makers also take into account stock options, retirement plans, and insurance benefits, both for you and your dependents, So, if you contribute $500 to your benefits plan every month and you miss two months, then a personal injury plan would award you $1,000.
Future Lost Earnings
Loss of wage and future earnings typically revolve around either permanent or temporary disability. The judge will take the difference between your pre-injury and post-injury earnings and then multiply it by the number of your expected remaining working years.
So, if you were making $100,000 a year and your earning capacity was knocked down to $50,000 a year after the accident, the judge would multiply $50,000 by however many years you had left to work. Judges can also take into account inflation with the help of the Consumer Price Index, adjusting nominal wages based on national trends in inflation.
Case-by-Case Basis
As you might imagine, calculating lost wages and earnings can become very difficult, particularly in the case of young people. For example, take the case of a 17-year-old who excelled in math and science. If they sustain a permanent brain injury and their plans were to attend medical school, could they claim a lifetime of earnings as a pediatrician or orthopedic surgeon? Or if a 60-year-old administrative employee was planning to work until 85, could they claim for all the years they expected to work as opposed to following the standard retirement guidelines?
This is a major reason why lost wages and earnings are calculated on a case-by-case basis because it’s impossible to foresee the many situations that can arise after a single personal injury accident. Typically, the judge will look at the extenuating circumstances. For example, a resident may have a better chance of filing for a lifetime of lost wages, because they were much closer to the teenager who may have gone on to change their major halfway through their college career.
Does Auto Insurance Cover Lost Wages?
Yes. In the no-fault state of Florida, personal injury protection (PIP) covers lost wages. All Florida drivers are required to have at least $10,000 worth of coverage for lost wages under PIP. If you were in a car accident, you should know that PIP typically covers 60% of loss of wage. If you need additional coverage, you may need to talk to a personal injury lawyer to help you navigate the next steps.
If you were injured in a car accident, it’s your insurance company that typically makes up lost wages — regardless of who was at fault. However, just because Florida is a no-fault state does not mean that you can’t file a claim against the negligent driver. Much like wage calculations, the decision about whether to file a lawsuit should be taken on a case-by-case basis.
Damage Mitigation
No matter what type of physical injury you sustained, you’re expected to mitigate the damages to preserve your earning capacity. You should follow your doctor’s treatment plans in the letter so that you can show you took every precaution to prevent avoidable issues. For example, if the doctor recommended three weeks of physical therapy and you quit after a week and went on to reinjure yourself, the judge might only award you partial lost wages because you failed to follow the doctor’s orders.
You’re also expected to seek alternative employment based on your condition. For example, if you used to have a very physical job as a restaurant server but now you can no longer complete the work due to your injuries, you’re expected to look for more sedentary jobs, such as office work.
Termination After Physical Injury
The laws about termination after physical injury are somewhat confusing. Your employer is not allowed to discriminate against you due to a personal injury, but they are allowed to terminate your employment if you can no longer perform the same duties as before. Because different employers may have different opinions about what constitutes an inability to perform the job, you can end up with additional disputes about lost wages.
Personal Injury Lawyers and Lost Wages
If you’re unable to work, you likely have a lot on your plate when it comes to your recovery. By hiring a personal injury lawyer in Florida, you can avoid the stress of having to track down all the paperwork and expert testimony you need to make your case. A personal injury lawyer will gather evidence and consult with specialists to ensure that your case is as airtight as possible. So, instead of trying to estimate what prices will be in 15 years, you can work with a personal injury lawyer who can give you guidance from one step to the next.
What to Expect from the Shapiro Law Group, P.A.
When you work with the Shapiro Law Group, P.A., our personal injury lawyers in Florida can handle all aspects of your personal injury claim. Not only do we have experience with an array of personal injury claims, such as slip-and-falls, dog bites, and auto accidents, but we also understand how these accidents impact the long-term future of our clients. If you’re concerned about the wages you’ll lose due to your accident, call us today to ensure you get everything you’re entitled to.
