Written by attorney Ronald Walter Kim

Loss of Earning Capacity


Loss of Earning Capacity - Damages that can be awarded in a personal injury case when an injury has reduced your chances of earning money in the future by working.

If your injury is severe enough that you are unable to work or return to work making the same amount of earnings, another part of your injury settlement you are entitled to be compensated for is loss of earning capacity. These damages are calculated based on your ability to earn money. The court will estimate a person’s earning capacity before you were injured then it will be compared to the amount a person is able to earn “after” the injury. This process begins with a treating physician giving an opinion as to the permanent impairment of one’s injury and what restrictions may be placed upon the individual thereby limiting their capability to return to pre-injury employment status. Then a vocational expert often plays a crucial role in establishing what jobs are feasible for the injured person to perform and what earnings might accrue to such jobs. The vocational expert (who is often a rehabilitation counselor) will gather and evaluate information such as the person’s job history, education and any special training. Proving that an individual has suffered a “loss of earning capacity” may sometimes be difficult, but it is not impossible. The essential element of doing this is to retain the services of a competent personal injury attorney that has had experience with this issue and has knowledge of the proper persons to retain for the services needed to achieve this goal

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