Loss of Earning Capacity After Catastrophic Injury
Intro
For many people who suffer a catastrophic injury, the most enduring loss is not confined to medical bills or physical pain—it is the loss of the ability to earn a living in the way they once did. Even when some work remains possible, careers are often derailed, shortened, or permanently limited. Presidio Law Firm LLP represents individuals whose catastrophic injuries have compromised their earning capacity, focusing on cases where insurers and defendants attempt to minimize the long-term financial consequences of life-altering harm.
What “Loss of Earning Capacity” Really Means
Loss of earning capacity is not limited to total inability to work. It refers to a reduced ability to earn income over time due to physical, cognitive, or functional limitations caused by injury. A person may still be employed, yet unable to perform at the same level, advance professionally, or sustain consistent work over a full career.
This distinction is critical. Many catastrophic injury survivors are pressured to return to some form of work quickly, only to discover that their injuries prevent long-term stability or progression.
How Catastrophic Injuries Disrupt Careers
Catastrophic injuries interfere with employment in ways that are not always obvious at first. Physical limitations may restrict lifting, standing, walking, or repetitive movement. Cognitive injuries may impair concentration, memory, or decision-making. Chronic pain and fatigue often reduce endurance and reliability.
Even where accommodations are available, injured individuals may no longer be competitive in their field or able to tolerate the demands of their prior role. Career trajectories that once appeared stable can collapse quietly over time.
Injuries Most Likely to Affect Earning Capacity
Loss of earning capacity frequently arises in cases involving traumatic brain injury, spinal cord injury, amputation, severe burns, and complex orthopedic trauma. These injuries often impose permanent restrictions that limit job options and advancement.
In mass-tort or disaster cases, survivors may also suffer compounded injuries—physical trauma combined with cognitive or respiratory impairment—that further narrow employment prospects.
Why Returning to Work Does Not End the Analysis
Defendants often argue that loss of earning capacity does not exist if an injured person returns to work. This argument ignores reality. Returning to work does not mean returning to the same earning potential, job security, or long-term viability.
Many injured individuals are forced into lower-paying positions, part-time roles, or jobs with limited advancement. Others experience repeated job loss due to medical setbacks, absenteeism, or declining performance caused by injury-related limitations.
The Role of Vocational and Economic Experts
Proving loss of earning capacity requires more than pay stubs. Vocational experts analyze how an injury affects a person’s ability to compete in the labor market, taking into account physical restrictions, transferable skills, education, and realistic job availability.
Economic experts then quantify the financial impact over time, comparing pre-injury earning potential with post-injury capacity. This analysis often reveals losses that far exceed initial expectations.
Career Longevity and Early Exit From the Workforce
Catastrophic injuries often shorten careers even when employment continues for some time. Chronic pain, degenerative changes, or cognitive decline may force early retirement or repeated medical leave.
These early exits are rarely voluntary. They represent a gradual erosion of earning capacity that must be accounted for in any meaningful evaluation of damages.
Self-Employed and High-Skill Professionals
Loss of earning capacity can be particularly severe for self-employed individuals, professionals, and business owners. Injuries may disrupt client relationships, licensing requirements, or the ability to manage complex responsibilities.
These losses are often harder to document but no less real. Detailed analysis of business records, industry standards, and professional demands is essential to presenting an accurate picture.
Why Insurers Consistently Undervalue These Claims
Insurers frequently focus on short-term income or isolated periods of employment to minimize loss-of-earning-capacity claims. This approach ignores long-term sustainability and assumes static conditions that rarely reflect post-injury reality.
A proper evaluation must account for uncertainty, medical progression, and the cumulative effects of living with a catastrophic injury over decades.
Damages Related to Loss of Earning Capacity
Damages may include lost future income, diminished career advancement, lost benefits, and reduced retirement contributions. These losses often exceed medical expenses in cases involving younger or highly skilled individuals.
Because these damages unfold over time, they require careful documentation and credible expert support.
Why Early Legal Evaluation Matters
Loss-of-earning-capacity claims benefit from early planning. Employment decisions made in the months following injury can shape how insurers characterize the case. Early legal guidance helps ensure that work attempts, accommodations, and medical limitations are accurately documented.
Closing
Loss of earning capacity is one of the most significant and least understood consequences of catastrophic injury. Presidio Law Firm LLP works with injured individuals to ensure that the long-term financial impact of their injuries is fully recognized and accurately presented. If a catastrophic injury has altered your ability to work or earn a living, our team can help assess the situation and explain the legal options available.