Future lost earnings, also called lost earning capacity, can be proven with evidence of past wages, as well as testimony from the plaintiff’s employer, doctor, and other expert witnesses. These sources of information can show what the victim could reasonably have expected to earn, were it not for the accident. They can compensate the victim for professional losses that will likely happen in the future.
What are lost wages in a personal injury case?
In a personal injury or car accident case, victims can recover all of their legal damages. These include the victim’s economic damages, which cover:
- medical bills and medical expenses,
- property damage, and
- loss of income due to the accident.
There are 2 types of loss of income:
- loss of past wages, and
- loss of future earnings, also known as lost earning capacity.
Lost past wages covers the time from the accident to the time the lawsuit was filed or settled.
Lost future earnings covers the income that the victim was likely to earn, in the future. It is often calculated in current value, so inflation and cost-of-living increases are not included. This is because any future earnings will be awarded in the verdict or settlement.
Lost future earnings are more difficult to prove than lost past wages. For lost wages in the past, it can be as easy as multiplying the number of hours missed at work and the victim’s hourly wage.
How can I prove lost earning capacity?
Proving lost future earnings is difficult because they are more conjectural. However, victims can prove what they were reasonably likely to earn in the future with records of past income, testimony, and expert testimony.
For victims who were in the middle of their career, past income can be used as evidence of anticipated future income. Evidence of past income is especially strong when the victim or plaintiff had little intention of changing careers. This kind of evidence can include:
- pay stubs,
- prior tax returns, and
- letters from the employer.
Non-expect testimony is another way to prove future lost wages. This can be used to prove the extent of the victim’s injuries and his or her work ethic and future plans. This testimony can include:
- the victim’s doctor or another medical expert, who can explain how the injuries have affected the victim’s ability to work,
- coworkers, who can talk about how hard the injured person worked and what his or her professional goals were, and
- the victim’s boss, supervisor, or employer, who can talk about the victim’s professional opportunities, work history, and performance on the job.
Expert testimony can be important for victims whose injuries do not clearly hold them out of work, or who worked in non-traditional roles. This can include:
- a vocational rehabilitation expert, to discuss the extent of the victim’s injuries, what kind of treatment the victim will need in the future, and when or whether the victim could reasonably be expected to return to the workforce, and
- an economist or expert in the victim’s professional field, to show salary trends, the future of the field of work, and what the victim’s future job prospects likely held.
What if I am self-employed?
Victims who are self-employed tend to have more problems proving future lost earnings. Their income often fluctuates far more than traditional workers. However, records of past income can be used to show trends. Expert witnesses can also provide insight into how the victim’s business or venture would do, in the future.
What if I am in school or just starting a career?
Young victims or plaintiffs who are just starting their careers can still recover future lost earnings. Certain factors will have an outsized effect in the calculation, though, like:
- the victim’s education level, and
- the professional intentions and goals of the victim.
There will also be some types of evidence that will not be available, like:
- records of past earnings,
- a history of strong work performance, and
- employer’s letters, detailing the victim’s work ethic.
Even without the normal types of evidence required, a personal injury lawyer can still put together a strong personal injury claim for the injured party.
What factors will be important?
Proving and determining lost future earnings often turns on the following factors:
- the victim’s occupation,
- whether the victim worked full-time or part-time,
- the victim’s age and life expectancy,
- whether the victim suffered a permanent injury,
- whether the victim will be able to return to work in some form,
- the victim’s professional goals, and
- the victim’s education level.
However, every case is different. An experienced personal injury attorney from a reputable law firm will know which factors to stress in a particular case.
What is the law in California?
In California, victims can pursue compensation for lost future earning capacity. To recover them, though, the lost earning capacity has to be the result of the injury and has to be reasonably certain.1 Plaintiffs have to show:
- that it is reasonably certain that the injury will cause the victim to earn less money in the future than he or she otherwise could have earned, and
- the reasonable value of that financial loss.2
To determine the value of the lost income or wage loss, California juries have to compare what it was reasonably probable that the victim would have made, without the injury, with what the victim is reasonably certain to make in the future, with the injury.3 The difference is their lost earning capacity. Because these financial losses stemmed from the accident, the plaintiff deserves to be compensated for them.
- California Civil Jury Instructions (CACI) No. 3903C.
- CACI 3903D.
- Licudine v. Cedars-Sinai Medical Center, 3 Cal.App.5th 881 (2016).