Loss of Income or Earning Capacity

For people in Houston and throughout Texas, catastrophic or long-term personal injury  from a car accident or other incident can affect your ability to work and provide for your family.

The full degree of damages for loss of earnings is known as loss of earning capacity and is demonstrated by showing the actual loss of past income due to an inability to work at the job held at the time of injury, coupled with a diminished ability to work in the future.

What if I can work but not in the same job?

Even if you can still perform some work but not the same job as before the injury, you can make a claim for lost income and earning capacity.  Loss of income means money that you could not earn because of the accident and loss of earning capacity generally means that your ability to earn a certain income level has been negatively affected.

For instance, if a manual laborer has a permanently damaged hand, he or she might be able to get some job but their ability to make the same wage has been negatively affected permanently.  This is loss of earning capacity and it is quite common in cases of serious personal injury.

Proving Loss of Earning Capacity

Generally, expert witness will provide evidence to the court of a personal injury victim’s reduced earning capacity.  For instance, if, prior to an accident, a person is working as a welder and then loses an eye in a truck accident, in addition to damages for the loss of vision, he or she might be able to show that they can no longer work as a welder.paycheck  However, if they can perform a less-paying job, the difference in future income between those two jobs may be evidence of lost earning capacity.

Recovery of loss of earning capacity requires evidence of net loss following reduction for income tax payments, and sometimes other types of tax liabilities. Moreover, in Texas, any future damages must be reduced to present values which often requires the use of an economic expert to assist the jury in calculating the proper amount of loss of earnings to award persons with permanent, disabling injuries.

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Serious personal injuries often cause a loss of earning capacity!

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What about loss of income?

In almost every serious personal injury case we handle in Houston, we make a claim for loss of income or wages – past and future.  During your recovery period, all the time that you take off from work can be used to calculate loss of income.  The law allows you to claim loss of income even if you got paid because you took sick days or vacation time.

Sick days and vacation time belong to you and it is perfectly appropriate to seek reimbursement for the value of that lost time if used during your recovery period.  Moreover, if you are expected to miss work in the future – either do to medical care or recovery – you are entitled to be reimbursed your lost wages for that as well.

If you have been hurt in Texas and are off work, make sure you keep records of the following:

  • All sick time hours you have used
  • All vacation hours you used
  • Any hours you are docked
  • Keep all pay stubs and w-2 records to show your pay prior to the accident
  • In calculating lost hours, include all time going to the doctor or therapy

Demonstrating your loss of earning capacity requires the assistance of skilled professionals. If you or a loved one has been the victim of an injury caused by the negligent actions of another, contact the Houston law office of Michael P. Fleming & Associates, P.C., former Harris County Attorney today. Call 713-221-6800.