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Future Loss of Earnings or Wages

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What Is "Future Loss of Earnings"?

Future loss of earnings or wages refers to a class of damages awarded in a personal injury claim. These types of damages can be awarded in cases where the injury has permanently limited the plaintiff’s ability to earn wages. The plaintiff would then be entitled to recover the reduction in value of their earning capacity. Future loss of earnings is often referred as “loss of future earning capacity” or “impairment of earning power”.

Personal injury laws do not require a plaintiff to suffer an actual loss of wages or earnings. Awards for loss of future earnings are based on the person’s potential to make money, even if they have never actually exercised that potential

How Is Lost Earning Capacity Calculated?

Future loss of earnings is not calculated based on the plaintiff’s actual earnings, either before or after the injury.  Instead, the damages are calculated based on the person’s ability to earn money. The court will estimate the person’s earning capacity before the injury, then compare it to the reduced earning capacity resulting from the injury.  An award will be issued based on the difference in potential earning power, not on what they actually earned in the past.

The theory behind future loss of earnings awards is that the injury has seriously diminished the plaintiff’s capacity to earn wages in the future. Thus, even if the person was unemployed before or at the time of the injury, this will not prevent the court from rendering an award for future loss of earnings. 

Also, the fact that the plaintiff was not completely disabled due to the injury will not prevent or reduce their claim for future loss of earnings. However, the award may be reduced completely barred if the person had contributed in some way to their own injuries.

An award for future loss of earnings can be very powerful, as it may allow the plaintiff to be compensated for losses spread over the remainder of their working years. 

Do I Need to Hire a Lawyer for Future Loss of Earnings or Wages Claims?

If you have received an injury that has impaired your ability to earn wages in the future, you may be able to recover your future losses. You may wish to seek the advice of a personal injury lawyer who can advise you on how to file a claim. The laws governing future losses of earnings may vary from state to state. For example, some states may limit recovery if the plaintiff contributed to their own injury or if they had a pre-existing medical condition. Your attorney can explain to you the requirements of your state’s laws.  

Photo of page author Ken LaMance

, LegalMatch Law Library Managing Editor and Attorney at Law

Last Modified: 05-22-2018 01:37 AM PDT

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