What is Calculating Lost Wages?

Calculating lost wages is the process of determining how much income a person has lost due to an injury caused by someone else’s negligence. In a personal injury claim, this amount is part of the economic damages the plaintiff can seek, covering not only missed paychecks but sometimes lost future earning potential as well.

Accurately calculating lost wages helps ensure injured plaintiffs receive full and fair compensation.

How are lost wages calculated after an injury?

Lost wages are typically calculated by multiplying the amount of income you earn per day, week, or month by the number of workdays missed due to your injury. The total can also include overtime, bonuses, and commissions that were reasonably expected.

To prove lost wages, you’ll need documentation such as pay stubs, employer letters, tax returns, and medical records verifying your inability to work.

• Multiply your daily or hourly wage by the days missed due to injury.

• Include tips, bonuses, and commissions if they were part of your regular income.

• Provide employer verification confirming dates missed and your pay structure.

• Medical documentation must support your inability to work during the time period.

What if you’re self-employed or work freelance?

Self-employed individuals can still claim lost income, but calculating it is more complex. Courts often rely on tax returns, business income records, and client invoices to estimate losses. You may also claim for missed business opportunities or canceled contracts.

A CPA or economic expert may be helpful in proving these losses if your income varies month to month.

• Use tax returns, profit/loss statements, and invoices to show earnings trends.

• Document canceled gigs, contracts, or clients due to your injury.

• You can claim lost future opportunities, not just missed workdays.

• Expert testimony may be needed to validate fluctuating income or growth potential.

Can you recover lost future income?

Yes. If your injury results in long-term or permanent disability that reduces your ability to earn money in the future, you may be entitled to lost earning capacity. This requires expert analysis to estimate what you would have earned over time if the injury hadn’t occurred.

These claims are common in serious injury cases where a person can’t return to their prior occupation.

• Lost future wages cover diminished earning capacity, not just time missed.

• Requires vocational or economic expert testimony to estimate career impact.

• Considers education, skills, age, and career trajectory pre-injury.

• Can involve life-care planners if lifelong disability affects earnings.

What’s the difference between lost wages and lost earning capacity?

Lost wages refer to the actual income missed from work already—like days or weeks you couldn’t show up to your job. Lost earning capacity is forward-looking and involves estimating income lost due to permanent or long-term injury.

Both can be claimed in a personal injury lawsuit but require different types of proof.

• Lost wages = past income you didn’t receive due to time off.

• Lost earning capacity = future income lost due to reduced work ability.

• Lost wages are easier to document, often using pay stubs and time sheets.

• Lost earning capacity often needs expert analysis or testimony.

Conclusion

Calculating lost wages is a vital part of personal injury compensation. Whether you missed a few weeks of work or suffered a career-ending injury, documenting your income loss can make a significant difference in your case. Clear records and, when needed, expert testimony are key to proving these damages.