Can I Be Compensated For Lost Earnings?
Car accidents can devastate a family’s budget, especially if the primary breadwinner is injured. When this happens, it can mean no income for weeks or even months. In some cases, a victim can never work again.
This can cost families dearly, resulting in repossessions, foreclosures, evictions, and even bankruptcy. Fortunately, if you’ve lost work because of a car crash or other injury caused by someone else’s negligence, then you may have a right to seek compensation for your lost wages. This includes compensation for lost future earnings and diminished earning capacity.
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Why Are Wages Compensated in a Personal Injury Lawsuit?
Wages include regular salary, hourly wages, paid time off, and even lost benefits. The purpose of a personal injury lawsuit is to make a victim whole again. The civil justice system was designed to put people back on their feet and fairly compensate them for their losses. If you cannot work because of what someone else did to you, then it is only just and proper that the at-fault person make it right by compensating you for the lost time.
How Do You Calculate Lost Wages in a Personal Injury Case?
Lost wages are usually pretty straightforward to calculate. You start by reviewing medical records and discussing the injuries with your treating physician. It’s usually not enough that you were sore and decided not to go to work. You will need a doctor to determine that you should not work or that your injuries are such that it would be best you stay home.
In most cases, a doctor will place an injury victim on some form of work restriction. If your employer is not willing or able to accommodate your limitations, then you may be forced to take some unpaid time off.
Here is how attorneys calculate your lost wages:
- Step One – Determine the total number of work days missed from work.
- Step Two – Determine the hourly rate of pay (if paid by the hour). If paid on a salary, it will depend on the annual salary and the number of days misses. This usually involves your attorney having your employer provide something from personnel or human resources, stating the total amount of missed during the period of time in question. Even if you were able to take paid sick leave, you may still be entitled to compensation. It would be unfair to force you to use your paid leave days for injuries that were someone else’s fault.
- Step Three – Finally, you or your attorney can simply multiply the number of days and hours missed by the rate of pay. Keep in mind, many workers lose paid time off (PTO) and other fringe benefits as a result of taking time off work. These should be discussed with your attorney to determine if they can be claimed as well.
How Do You Prove Lost Wages?
Proving lost wages generally starts with pay stubs, medical statements from a treating physician, and something from your employer verifying the amount of time that was lost. The goal is to provide enough information to the insurance company that it is clear you can prove your lost income if forced to do so. Usually, a signed statement from your HR rep combined with your physician’s statement will suffice.
How Do You Calculate Lost Future Earnings?
The tougher questions usually surround proving future lost earnings. This is because it is always tougher to make predictions about the future than to document what happened in the past. However, there are several keys to proving your diminished future earnings. You can generally break this equation down into several parts:
- Your current profession
- Your skills
- Your age and life expectancy
- Availability of suitable replacement income or careers
To understand these, just consider a person who was a skilled carpenter for 20 years. This person suffers an amputation, leaving him entirely unable to perform his chosen profession. The first step is to look at whether the person has any reasonable opportunity to retrain for a different profession and whether there are readily available opportunities for him to be gainfully employed, given his injury. Next, the attorney can refer to the Social Security Administration’s actuarial tables to determine roughly how long the person can expect to live after the injury. This is then used to estimate the individual’s likely reduction in lifetime earnings, as a result of the injury.
Keep in mind, however, that when a trial is required, a trained actuarial expert will often be retained in order to explain to the jury how these future losses were calculated. An actuarial expert is someone who specializes in calculating risk and determining life expectancies, as they apply to changes over time. An actuarial expert report can be the key to increasing a victim’s overall compensation and helping a jury put a number on an otherwise very confusing type of loss.
What If I Am Completely Disabled and Cannot Go Back to Work?
If you are completely disabled and cannot go back to work, you may require several other types of assistance. For example, you may qualify for benefits through the Social Security Administration, based on your permanent disabilities. Likewise, if the injury occurred at work, you may be eligible for workers’ compensation benefits. Finally, in many cases, a permanently disabling injury may entitle you to significant compensation for future lost wages.
In some cases, you and your attorney will want to discuss having a portion of the settlement or award placed into a special needs trust or special set-aside account for the purposes of covering future medical bills and other expenses that are reasonably likely to arise in the future.
For many people, their personal injury award or settlement is the single largest sum of money they have ever received at one time. Therefore, it is important not to simply spend the money right away. Instead, it may be helpful to discuss how to best protect your financial recovery for the future. Those with permanent disabilities may need to rely on their funds for decades to come.
Contact an Alabama Personal Injury Attorney
At Gartlan Injury Law, we don’t just help our clients recover compensation. We aim to help our clients improve their lives. This all starts with a free and confidential claim review. We never take a fee unless we succeed at getting compensation for your injuries. So there’s no risk and no obligations. Call today to speak with an attorney about your case and your best options for recovering compensation.
