Understanding Lost Wages in Personal Injury Cases

Determining lost wages from personal injury is a difficult process. It is one of the few objective elements in personal injury law, but a mistake could mean your client fails to secure fair compensation. If you have a complex case that involves lost wages and personal injury in San Francisco, CA, it’s a good idea to hire a forensic accountant.

Here are the most common questions we hear about lost wage claims.

What are considered “lost wages”?

Hourly wages are the first item considered with lost wages. However, lost wages also include salary, overtime, bonuses and tips. (Note that tips must be reported for a victim to recover them.)

If the litigant uses sick and vacation days to recover from injuries, those are lost wages as well. Perks like a company mobile device or gym membership may also be compensated if the victim loses them during recovery from injury.

When you consider all the elements of lost wages, you start to see why it can be complicated. While determining actual lost income from regular hours and overtime is fairly simple, you often end up with complex claims when the litigant receives other forms of compensation outside a paycheck.

How do I prove lost wages?

Documentation proves lost wages. Attorneys and insurance companies request the information from the litigant’s employer, and sometimes provide those documents to a forensic accountant.

Also, we often find a letter from the employer helpful, especially if it contains the following information:

  • Title
  • Date hired
  • Indication that the litigant was employed at the time of injury
  • Hours worked per week
  • Pay rate
  • Typical overtime pay
  • Days or hours missed
  • Lost perks
  • Bonus structure

Besides this letter, we also require pay stubs, bank statements and tax returns.

I’m self-employed—can I recover lost wages?

Yes! The process is different from hourly and salary employees, but it is possible. Business records and an accountant’s examination of your finances can determine how much money you lost due to injury and recovery time. Also, your past tax returns can establish a pattern of earnings that contrast to your income and profit during your injury period.

My injury took me out of my current profession. Is it possible to recover earning potential?

Sadly, many accident victims cannot return to their previous profession. This often reduces earning potential, and many people wish to recover that as well. It is also a common claim if injury renders a litigant unable to work.

Earning potential is not the same as lost wages—it is a record of wages lost in the future. Determining damages usually depends on the examination of records and testimony of a forensic accountant. If you have the right evidence, you will likely prevail in this claim.

Medina & Company Consulting, Inc. offers litigation support in San Francisco, CA and the surrounding areas. We understand the process of determining lost wages from personal injury and offer our experience as expert witnesses in lost wages and personal injury cases. Call us today to discuss your case.