One of the Biggest Harms in a Serious Personal Injury Case is Past and Future Lost Wages

As many of you know, I like to blog a lot. But I wanted to have a guest from another state talk about an important issue. So my friend at Miller and Zois, Ron Miller is guest posting as follows: One of the biggest harms in a serious personal injury case is past and future lost wages. When an injured personal injury plaintiff loses earnings or earning capacity, the value of this loss must be calculated. Past earnings are verified through wage statements and other methods, such as pay stubs, W-2’s and income tax returns. Estimates of future losses are based on medical prognosis.

There is some degree of debate about whether wage loss should be determined based upon the claimant’s gross or net wages. When the employee loses sick time, seniority, health insurance or other benefits, the gross figure is likely most appropriate. This is particularly true in jurisdictions that adhere to the “collateral source rule” which states that in determining damages, it is irrelevant whether the claimant has been reimbursed from a source other than the tortfeasor, such as sick time, short-term disability insurance or the like.

This analysis is more complicated where the claimant is self-employed or where a significant portion of their income is commission-based. For the self-employed, the measure of the past loss often depends on proof of their lost profit. This will usually require an expert opinion based on past profitability, as compared to profitability during the period of disability, taking into account costs and market factors. If the claimant is self-employed in a new business venture, insurers will steeply discount any claimed losses if they accept them at all, since there are no prior results that may be used as a comparison point to determine the lost profit.

Long term losses require particular care. The insurance carrier - particularly in car accident cases - carefully considers whether the injured person may resume any type of employment, and if so, when. For claimant’s counsel, proving future wage loss requires a combination of factual evidence and expert opinion. A medical expert will need to address the claimant’s physical abilities.

A vocational expert will address the claimant’s ability to seek and obtain employment in the marketplace, and an economist will be needed to translate all of this information into a number that represents the present value of the future losses. Insurers know what to look for on a claim of this type, and are unlikely to offer settlement money for these kinds of losses without the proper documentation. Carriers may be expected, except in the most obvious situations of total and permanent disability, to claim that the injured person may perform some occupation or can be trained to fill one. If the carrier has some evidence to support either position, it reduces the settlement.

If you want to learn more, contact Ron Miller, Esq. I can vouch for him as a brilliant car collision attorney.