Calculating Lost Wages For Your Personal Injury Case

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If you’ve sustained an injury due to another’s negligence, you are legally entitled to seek monetary compensation. The extent of the injury may result in the inability to work, either temporarily or permanently.

You may be eligible for economic and non-economic damages for the injuries you received. Economic damages include specific expenses and those losses that can be mathematically calculated. These damages are generally more straightforward and easier to recover.

Non-economic damages, on the other hand, are more difficult to quantify, although insurance companies try to convince you that their mathematical formula adequately compensates you. Costs such as pain, suffering, and loss of enjoyment are non-economic damages and require careful explanation and documentation to recover.

Lost Wages Explained

The term lost wages describes compensation that would have been earned had the injured party not missed out on work.

Lost wages can be recovered by full-time or part-time employees and by individuals who make hourly, weekly, or monthly salaries. These wages include overtime pay, the value of sick leave or vacation days, company perks, bonuses, and tips.

Calculating Lost Wages

Before calculating lost wages, it’s crucial to seek medical attention for your injuries. Medical documentation is the best way to substantiate your injury claim. If your doctor tells you to take time off from work to recover from your injury, you should document by having the doctor write you a note to remain out of work.

Proving lost wages usually requires additional documentation. Start by obtaining a letter from your employer that states your hourly rate of pay or an annual salary, typical hours worked in a week, overtime earnings, and time taken off due to your injury.

Hourly Employee

To calculate lost wages as an hourly employee, you need to determine the number of regular hours missed from work. If your hours per week vary, use the previous month to calculate an average. Next, you multiply the number of missed hours by your hourly rate. Repeat this procedure for overtime hours but multiply missed hours by 1.5 times your hourly rate.

Salaried Employee

To calculate lost wages as a salaried employee, you divide your annual salary by the number of hours you work in a year (40 hours a week would equal 2,080 hours a year). Once you determine an hourly pay rate, multiply it by hours missed to calculate lost wages.


Self-employed income is more challenging to calculate. You can use previous tax records, if you’ve been self-employed long enough to report a yearly income. However, if you are newly self-employed, you will need another means of proving lost wages, such as contracts, orders, or appointments that can demonstrate potential earnings had you been able to work.

Calculating Benefits

Benefits, such as potential contributions to a retirement plan, bonuses, and commissions, contribute to your total wages. If you lost any benefits as a result of missing work, you should include their value in your lost wages calculation.

Calculating lost wages for your personal injury case isn’t always straightforward. Contact our office today to discuss your legal options if you have been injured due to another’s negligence.

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