Lost Wages and Future Earning Capacity in Missouri

An injury does not just hurt your body. It hurts your paycheck. When an accident prevents you from working — whether for two weeks or the rest of your life — Missouri law provides a path to recover those financial losses. But the difference between recovering what you actually lost and leaving significant money on the table depends on how these damages are documented, calculated, and presented.

Lost Wages vs. Lost Earning Capacity

These two categories of economic damages are related but distinct, and confusing them is a costly mistake.

Lost wages compensate you for income you have already lost — the paychecks you missed while recovering, the overtime you could not work, the bonus you did not earn because you were on medical leave. These are backward-looking damages with concrete documentation.

Lost earning capacity compensates you for income you will lose in the future because your injury permanently diminishes your ability to earn. A construction worker who can no longer lift heavy loads. A surgeon whose hand tremor prevents operating. A salesperson whose chronic pain limits travel. These damages project forward across an entire career and often dwarf the lost wages claim.

Documenting Lost Wages

The foundation of a lost wages claim is documentation. You need to establish three things: what you earned before the accident, how long you were unable to work, and how much income you lost during that period.

Employment records. Pay stubs, W-2 forms, and tax returns from the two to three years preceding the accident establish your baseline earnings. For salaried employees, this is straightforward. For hourly workers, commission-based employees, or those with variable income, the calculation requires averaging across a representative period.

Employer verification. A letter from your employer confirming your rate of pay, your normal hours, and the dates you missed work provides authoritative documentation. If you lost overtime opportunities, ask your employer to document the overtime your coworkers worked during your absence.

Medical documentation. Your doctor must connect your inability to work to your injuries. A note stating "Patient is unable to return to work until [date]" links the lost income directly to the accident. Without this medical bridge, the defense will argue you chose not to work.

Self-employment income. If you are self-employed, lost wage calculations become more complex. Tax returns, profit and loss statements, contracts, and client records establish what you would have earned. The defense will scrutinize these records closely, so thorough documentation is essential.

Calculating Lost Earning Capacity

Future earning capacity requires projecting what you would have earned over the remainder of your working life and comparing it to what you can now earn given your injuries. This calculation involves several variables, each of which can be contested.

Career trajectory. What was your realistic earning path before the injury? Were you in line for promotions? Did your industry have predictable salary growth? A 28-year-old associate attorney has a different earnings trajectory than a 55-year-old retail clerk approaching retirement.

Work life expectancy. How many more years would you have worked? This depends on your age, occupation, health, and industry norms. Economists use Bureau of Labor Statistics data and actuarial tables to estimate this figure.

Diminished capacity. What can you earn now? If you cannot return to your previous occupation but can perform lighter work, the lost earning capacity is the difference between your previous trajectory and your new earning potential. If you cannot work at all, the calculation is your full projected earnings stream.

Present value discount. Future earnings must be reduced to present value — a dollar earned ten years from now is worth less than a dollar today. Economists apply a discount rate to convert future earnings into a lump sum that, if invested, would produce the equivalent income stream over time.

The Role of Expert Witnesses

Lost earning capacity claims almost always require expert testimony. An economist or vocational expert provides the analytical framework that transforms your story into a credible damages calculation.

Forensic economists calculate the present value of lost future earnings using established economic models. They account for inflation, wage growth, discount rates, fringe benefits, and tax implications. Their testimony translates complex financial projections into numbers a jury can understand.

Vocational rehabilitation experts assess what jobs you can still perform given your physical limitations. They evaluate your education, skills, work history, and functional capacity to identify alternative employment options and their associated compensation levels.

Medical experts testify about the permanence of your limitations and your future functional capacity. Their opinions form the medical foundation on which the economic projections rest.

What the Defense Will Challenge

Insurance companies attack lost earning capacity claims aggressively because these damages are often the largest component of a serious personal injury case.

"The plaintiff can still work." The defense will argue that your injuries are not as limiting as you claim. They may hire a vocational expert who identifies jobs you could theoretically perform, even if those jobs pay significantly less than your previous work.

"The plaintiff was not going to advance." Defense economists may challenge assumptions about promotions, raises, and career growth. They point to job-hopping, disciplinary issues, or industry downturns as reasons to project lower future earnings.

"Pre-existing conditions limited earning potential." If you had health issues before the accident, the defense will argue those conditions would have eventually reduced your earning capacity regardless of the accident.

"The discount rate is wrong." Small changes in the discount rate produce enormous differences in present value calculations over a 20- or 30-year projection. Defense economists typically use higher discount rates, which reduce the present value of future losses.

Special Circumstances

Homemakers and caregivers. Missouri recognizes that homemakers perform economically valuable work even though they do not receive a paycheck. Lost earning capacity for homemakers is calculated based on the market cost of the services they can no longer provide — childcare, cooking, cleaning, household management.

Young workers and students. People who were injured early in their careers or before entering the workforce present unique challenges. Their earning potential must be estimated based on education, aptitude, and career goals rather than an established earnings history.

Business owners. If an injury forces you to sell a business, reduce operations, or bring in replacement management, the lost business value may be recoverable. This requires careful documentation of how the injury affected business performance.

Protecting Your Lost Wages Claim

Keep meticulous records. Save every pay stub, document every missed day, and keep a log of work limitations caused by your injury. Contemporaneous records are far more persuasive than reconstructed estimates.

Follow medical advice. If your doctor clears you for light duty, attempt to return. If your doctor restricts your activities, follow those restrictions precisely. The defense will use any inconsistency between your medical restrictions and your actual behavior.

Do not rush back to work. Returning too early can worsen your injury and complicate your case. It can also create the impression that your injuries were minor. Follow your doctor's timeline, not your employer's pressure.

Document everything you cannot do. A journal noting activities you can no longer perform — carrying groceries, typing for extended periods, standing through a full shift — provides powerful evidence of functional limitations.

FAQ

Can I recover lost wages if I used sick leave or vacation time?

Yes. Missouri courts recognize that using sick leave or vacation time to cover an absence caused by someone else's negligence represents a real economic loss. You are entitled to recover the value of those benefits even though your paycheck was not reduced.

What if I was unemployed at the time of the accident?

Being unemployed does not eliminate a lost earning capacity claim. If you were actively seeking employment, had a work history, and your injuries now prevent you from working, you can still recover lost earning capacity based on what you would have earned.

How far into the future can lost earning capacity be calculated?

Lost earning capacity is typically calculated through your expected retirement age. For a 35-year-old, that projection might extend 30 years or more. The present value calculation accounts for the time value of money over this extended period.

Do I need to prove exact dollar amounts?

Missouri law does not require mathematical certainty. You must present sufficient evidence for a jury to make a reasonable estimate. Expert testimony, employment records, and medical evidence provide the foundation for that estimate.

Can I recover lost earning capacity for a partial disability?

Absolutely. If your injury reduces but does not eliminate your ability to work, you can recover the difference between what you would have earned and what you can now earn. A partial disability claim often involves vocational expert testimony about alternative employment options.

Your injury already cost you enough. Make sure you recover what you deserve — call OTT Law at (314) 794-6900.

This article is for informational purposes only and does not constitute legal advice. Every case is different. Contact OTT Law at (314) 794-6900 for a free consultation specific to your situation.