After you suffered an injury following an accident can often lead to a substantial period of time away from work and a significant loss of income.
A claim for loss of earnings forms part of a Personal injury claim for special damages which is a term for the out of pocket expenses, such as wages, salary, profits, medical costs, care etc incurred or arising as a direct result of the accident which caused the personal injury. In addition to special damages, a personal injury claim will consist of a demand for general damages which is the label given to the monetary value of pain, suffering and loss of quality of life arising from the injuries.
A claim for loss of earnings is broken down into two parts:
- past loss of earnings; and
- future loss of earnings.
Firstly, it is important to note that compensation for injuries suffered in an accident, including that part relating to loss of earnings, is treated as capital. In keeping with the rule that a claimant is only entitled to be compensated for actual loss suffered, Courts in Ireland award loss of earnings on only a net after tax and social charge basis.
When a claimant is an employee of a business, then a personal injury claim for a loss of earnings covers not only the basic wages but also any loss of overtime, bonuses, benefit(s) in kind or shift allowance. Usually they will first assess a claimant’s net average yearly income in order to calculate the average salary. In a straight forward claim the average monthly wage is multiplied by the period of absence and the resulting figure is deemed to be the value of a past loss of earnings claim.
If you wish to claim loss of earnings in a personal injury claim, it is necessary that your PIAB application makes this clear by ticking the relevant box on Form A. You should also furnish enough supporting documentation, including your past pay slips and prior year tax returns, accounts etc. You need to make sure that your claim is fully documented. It is essential that you instruct a Personal Injury lawyer, who will properly prepare and evaluate your loss of earnings claim.