If you have suffered an injury (or injuries) due to someone else’s negligence, it may be possible for you to bring what is known as a personal injury lawsuit in order to receive compensation for what you have gone through. While no amount of money will ever “restore” you to the exact person you were before you were injured, financial compensation provides assistance in getting back to the life that you experienced before the injuries. Compensation for your injuries comes in a few different forms: (i) non-economic damages, such as the loss of enjoyment of life and pain and suffering, and (ii) economic damages.
This category of economic damages includes compensation for your medical bills and expenses as well as reimbursement for the wages you lost as a result of your injuries. Economic damages also include compensation for your loss of earning capacity. Specifically, the injuries you suffer as a result of someone’s negligence may be severe enough to prevent you from returning to your previous line of work (or from working at all). In other situations, the injuries you sustain may prevent you from reaching your full potential or capacity in future employment opportunities.
In many personal injury cases, lost wages are relatively straightforward to calculate – although this is not always true. If you miss work while recovering from your injuries, or if you have to miss work due to medical appointments, rehabilitation therapy, and so on, you are entitled to reimbursement for that missed time. Even if you were paid by your employer through sick time, vacation time, and/or personal time, you are still entitled to compensation for the loss of your paid time off. After all, if you never sustained the injuries in the first place, you never would have had to miss work and use your paid time off benefits. Remember, the theory behind financial recovery in a personal injury lawsuit is to make the injured person as “whole” as possible. That includes compensation for lost wages or lost paid time off.
Individuals who are self-employed are also entitled to compensation for lost wages, although this is sometimes more difficult to calculate. Lost wages in the case of a self-employed individual may include more than just lost hours. It may include economic damage to the business in the form of lost business opportunities, extra costs resulting from the need to hire replacement labor, etc. In these cases, income statements and tax records are important to show the pre- and post- injury discrepancy in income.
Loss of Earning Capacity
A loss of earning capacity is sometimes difficult to formulate into a tangible compensation amount. Sometimes, injured plaintiffs and defendant insurance companies hire economic experts who reach very different results when it comes to forecasting an injured person’s loss of earning capacity.
Essentially, an individual suffers a loss of earning capacity when he or she suffers injuries, which in turn, prevent probable earning opportunities. For example, if a well-paid, skilled laborer is injured due to someone’s negligence, and as a result of those injuries can never resume work in the same manner earning the same amount of money, he or she has suffered a loss of earning capacity. That individual may never be able to work again, or he or she may have to take a lower-paying job within his or her physical limitations – thus, suffering a loss in future income.
Lost future income can also include lost promotion opportunities and lost benefits (e.g., health insurance, retirement benefits, stock options, etc.).
A loss of earning capacity calculation necessarily involves the projection of probable future earnings. This includes some degree of speculation, including probable career trajectory, inflation, etc. And, you can be sure that insurance company defense attorneys will try to undercut any amount you present as severely speculative. However, a skilled, reputable personal injury attorney will bring in economists and vocational experts to help determine an accurate estimation of loss of earning capacity, and present the evidence necessary to support this estimation.
If You Have Been Injured in an Accident, Call Petro Cohen Petro Matarazzo
The attorneys at Petro Cohen Petro Matarazzo represent injury victims in accident insurance settlements and litigation throughout the State of New Jersey. We have significant experience helping our clients recover compensation for their lost income and loss of earning capacity. To schedule a free initial consultation, contact the firm today by calling or filling out our online contact form.