What Qualifies as Lost Income in a Personal Injury Lawsuit?

by Kirk Farrar on Jan. 12, 2018

Accident & Injury Personal Injury 

Summary: Many people forget that lost income is more than just the lost wages you won’t receive from not being able to work.

Unexpected injuries can wreak havoc on your finances and savings. In many cases, negligence on someone else’s part is the reason for your injuries and the reason you've lost what you've worked so hard for.

When this happens, you deserve compensation not only for the medical expenses you’ve had to pay to recover from your injuries and maintain your health, but also for the lost wages you’ve had to endure because of your incapacity to work.

Understanding What Qualifies as “Lost Income”

Personal injury settlements that cover lost income should include all forms of regular income that you will no longer receive because of your injuries. This is what is known as “total employment compensation.”

The Difference between Lost Compensation and Lost Income

As you embark on a personal injury case, the terms can often be difficult to understand. Two terms that you may hear regularly are “lost compensation” and “lost income.” These actually mean different things.

Traditionally, the courts have ruled that the victims of personal injury cases are entitled to be reimbursed for all of the income that they did not receive while they were being treated and recovering from the injuries they endured. Again, this means traditional wages, but it also means any additional compensation. Here is the difference between “lost compensation” and “lost income”:

Lost Income

Lost income (also known as lost wages) is the money that you would have received from your employer had you been able to perform your normal job. This is your standard income. For any given person, this may be income that is received weekly, biweekly, monthly, bimonthly, etc. For all intents and purposes, this is the money that will be paid to you via direct deposit to your bank account or by official check.

Lost Compensation

Lost compensation is the other compensation that you receive from your job. Additional financial benefits, such as vacation days, sick days, and benefits are all considered “compensation.”

Furthermore, lost compensation includes whatever income you have the capacity to earn. For example, if you receive any other employment perks or could have received pay bonuses or other incentives for your work, this would be considered additional “compensation.”

More on Lost Compensation

For most plaintiffs in personal injury cases, lost wages or lost income is fairly easy to understand. You simply look at the money that you would have definitely earned from your employer had you not been injured.

Lost compensation, on the other hand, is a more difficult concept to wrap your head around. Therefore, let’s break down the various forms of compensation that you may need to account for when you file your personal injury case:

Sick Days

Most employers allow employees to accumulate sick days. Because of a serious injury, you may have had to use all or most of your sick days upon your treatment and recovery. In this case, you can be compensated for losing these sick days. Traditionally, the court would award a day’s worth of wages for every sick day that you lost. Naturally, the sick days that you used must have been used because of the personal injury claim at hand.

Vacation Days

Again, most employers give a certain amount of vacation days to employees. In most situations, when sick days are used up and run out, employees have the choice of using their vacation days as a backup.

If you were seriously injured, and the treatment and recovery you required forced you to use your vacation days because you had already used up all of your sick days, you will be entitled to compensation for your lost vacation days as well. Again, one lost vacation day will be worth a day’s wages.

Bonus Days

In addition to vacation days and sick days, many employers offer other “free days off” because of exemplary performance, birthdays, holidays, and other celebrations or special events. As with the other types of days, you would receive a day’s worth of wages for each of these “missed days.”


Bonuses are monetary. These are given to employees because of exemplary performance. Had you been able to work, you may have never received these bonuses. However, you would have been able to receive them. Therefore, you deserve compensation for them.

Other Benefits and Perks

Finally, keep in mind that “benefits and perks” are almost like bonuses. The main difference is that benefits and perks may be non-monetary. For example, you might have been able to have free company tickets for a sports event, free golf outings, or free passes to a local theater at your job. These would have been perks you’d experience had you not been injured.

Get Legal Assistance with a Personal Injury Lawyer

If you’ve been injured seriously, you may deserve compensation for the injuries, medical expenses, and lost wages you’ve endured. No one should have to lose their wages, sick and vacation days, and potential bonuses and perks because someone else was negligent and caused you to suffer. In almost all cases of serious personal injury, a lawyer can help you get thousands more in compensation than you would have received otherwise had you filed your personal injury claim alone. They will help you recover your lost income and your lost compensation.

To learn more about filing your personal injury claim and receiving lost income from the at-fault party, contact a reputable and experienced lawyer in your area today. In many cases, a personal injury lawyer will meet with you for an initial consultation free of charge.

You can explain your circumstances and case to your lawyer at this meeting, and if they feel they can help you, many personal injury lawyers will work on what’s called a “contingency basis.” This means that — other than standard filing fees — your lawyer won’t charge you for anything for their time on your case unless you win the case. And in this situation, they’ll receive a percentage of what you receive in compensation as payment.

Talk to a personal injury attorney today to discuss your case and learn more about your legal options. And remember that time is an important matter where personal injury cases are concerned. If you’re going to file a claim, you’ll need to do so as soon as possible to meet the appropriate legal deadlines.

You should get all of the compensation you deserve for the injuries you’ve unfortunately had to endure. Speak with an attorney today to learn more.

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