A key part of any personal injury case or lawsuit is the amount of damages — meaning suffered losses that can be compensated due to an accident or injury. While an injured victim is eligible to receive compensation for medical expenses and pain suffering resulting from an accident, another category of damages that is often overlooked is lost income, which can include both money lost from a job you had at the time of your injury as well as reimbursement for potential job opportunities that you had to miss due to the accident.
Lost Income: What is Recoverable?
You are entitled to recover financial losses from the person who caused the accident, including any income lost due to the accident or sustained injuries. This includes both wages lost due to the inability to work and time missed from your job due to medical treatments for your injuries. The right to be compensated is applicable if you work full-time or just part-time, have regular or occasional employment, an hourly wage, or are self-employed.
It should be noted that income loss is not usually included in the final amount used to calculate special damages. It is added on once the amount has been calculated.
Sick Leave and Vacation Pay
Just because you were able to take sick days or vacation pay for time missed from work, and did not directly lose any income, does not matter when calculating damages due to lost wages. You are still entitled to use these days for other times when you may have needed to. Because of this, using up sick days or vacation pay is viewed the same as losing a day of pay.
In order to successfully be compensated for lost wages or income, you have to provide evidence of these two elements:
- The time you missed from your job was because of the accident; and
- The amount of money you would have earned during the time you missed from work.
Documenting Lost Income
If you are an employee regularly working for another entity, collecting information regarding your lost wages is relatively easy. You just need to ask your supervisor, boss, or personnel office to draft a letter using company stationery. The letter should also include your name, your position, your rate or pay, the number of hours you usually work, and the number of hours or days missed after the accident. The letter does not need if you took sick leave, vacation time, or a leave of absence due to your injuries.
If you do not have regular employment or are self-employed, proving lost wages can be more difficult and complex. You will have to show how much work time was lost and what you may have earned if you were able to work normally. You can use any type of evidence available that signifies a drop in billing or invoices, a calendar showing appointments that had to be canceled, and any documents or letters showing meetings, conferences, or other appointments that you could not attend.
After demonstrating how much work was missed due to an accident, you have to provide evidence of how much you would have earned. If you have been working a steady amount just before being involved in the crash, you can provide an average for the period by using copies of your billing, invoices, payments received, or any other relevant evidence of money earned. Then, considering how much you were working and earning during this period, you can then determine how much income you are considered to have lost during the time you were unable to work.
If you only work sporadically — with some weeks or months earning a majority of your income and other times doing very little — you can show the value of lost work time through providing evidence of what you usually make during a year’s period, then dividing this number into a weekly or monthly average.
However, the best evidence of what you make in a year’s period would be your personal income tax return for the year before. You only are required to provide the portion of your tax return that shows your year’s gross income. The remaining parts of the return — such as deductions and exemptions — is not relevant for your case, and the insurance provider does not have a right to see this information. If your earnings during the previous year were fairly low, you can include two or three years of returns to show how much you would usually earn. You should also include evidence of income for the current year that exhibits a similar earning pattern, as well.
You are also entitled to be compensated for work opportunities that were lost due to injuries sustained in an accident, in addition to time lost from work. However, it is more difficult to prove you lost income due to missing a job interview or a sales meeting than providing evidence of lost income through missing days at your actual job.
Even if you do not have a specific dollar amount of what was lost, just the fact that an insurance company knows that lost potential income is a valid part of your personal injury claim will increase your final settlement for compensation. How much the compensation will be raised will depend on the strength of proof provided that you lost an income opportunity and how this impacted you.
Vehicle Collisions in Utah
Car crashes can happen to anyone, at any time. Tens of thousands are harmed every year in the United States. These crashes can result in significant damages and injury to victims involved. In some cases, you can take the reckless driver to court in order to seek financial compensation for trauma with the help of a Salt Lake City car crash attorney.
At Siegfried & Jensen, our Utah personal injury lawyers have helped victims recover after being injured in a car crash for over 30 years. If you have been harmed by a reckless motorist, call us at (801) 845-9000 to see how we can help.