When an accident leaves you unable to work, the financial consequences can hit just as hard as the physical injuries and can quickly feel impossible to deal with. Fortunately, Florida law recognizes this fact and allows accident victims to pursue compensation for both their lost earnings and any long-term reduction in their ability to earn a living.
Learning about the difference between these two types of economic damages is essential to making sure your claim accounts for the full financial impact of your injuries. Read on to learn more about how Florida handles these claims and what you can do to protect your right to fair compensation.
Lost Earnings vs. Diminished Earning Capacity: What’s the Difference?
These two terms are sometimes used interchangeably, but they represent very different categories of damages under Florida law in personal injury cases.
Lost Earnings
Lost earnings refer to the income you’ve already missed as a direct result of your injury. This covers wages, bonuses, and other compensation you would have received during the time you were unable to work.
Lost earnings are backward-looking, meaning they account for the money you should have earned between the date of the accident and the present.
Diminished Earning Capacity
Diminished earning capacity is forward-looking. It addresses the long-term reduction in your ability to earn income due to a lasting impairment. For instance, even if you can return to work in some capacity, you may no longer be able to perform the same job and work the same hours.
Importantly, note that you don’t need to be completely unable to work to pursue this type of claim. Being forced into a lower-paying role because of your injuries, for instance, can still give rise to a valid claim.
How Are Lost Earnings Calculated in Florida?
Calculating lost earnings is relatively straightforward compared to calculating diminished earning capacity. The goal is to add up all the income you missed from the date of the accident through the present.
Factors that go into this calculation include:
- Your base salary or hourly wage
- Over time, you would have earned based on your work history
- Bonuses and commissions you missed out on
- The value of lost employment benefits
- Tips, if applicable to your line of work
- Sick days and vacation days you were forced to use during your recovery
Documentation is critical. The stronger your records supporting your claim, such as pay stubs and employment records, the harder it becomes for the insurance company to dispute your numbers.
How Is Diminished Earning Capacity Calculated?
This is where things become more complicated. Because diminished earning capacity concerns future income you haven’t yet earned, the calculation involves some degree of projection.
The types of experts commonly involved include:
- Economists who project your expected lifetime earnings with and without the injury, then calculate the difference
- Vocational rehabilitation specialists who assess what types of work you can still perform, given your limitations
- Medical experts who evaluate the permanence of your impairment and how it restricts your ability to work
Your personal injury attorney will typically work with an expert witness to build this part of your claim.
How Does Florida’s Comparative Negligence Law Affect My Claim?
Florida follows a modified comparative negligence statute with a 51% bar to recovery. That means if you share some responsibility for the accident that caused your injuries, your total compensation, including lost earnings and diminished earning capacity, will typically be reduced by your percentage of fault.
If your share of fault reaches 51% or more, you are generally barred from recovering any damages at all.
Insurance companies are well aware of this rule and will try to escape liability however they can. Having an experienced personal injury attorney on your side can help ensure that fault is assigned fairly and that your lost earnings claim isn’t undermined.
Contact a Fort Lauderdale Personal Injury Attorney at Workman Car Accident & Personal Injury Lawyers to Schedule a Free Consultation
Lost earnings and diminished earning capacity are often among the largest components of a personal injury claim. As a result, getting these numbers right can make the difference between a settlement that actually covers your needs and one that falls short. An experienced Fort Lauderdale personal injury lawyer can help you ensure you are fully compensated for all of your damages, including those based on lost income.
Call Workman Car Accident & Personal Injury Lawyers today at (954) 361-3997 to schedule a free consultation. With the contingency fee payment structure most injury lawyers operate under, you only pay attorney’s fees if you win your case.