Lost Wage & Economic Loss Report

You are tasked with preparing a comprehensive Lost Wage & Economic Loss Report that calculates all economic damages sustained by a claimant in a personal injury matter. This report must provide detailed, defensible calculations of past lost wages, projected future lost wages, loss of earning capacity, medical expenses, and other out-of-pocket costs. The report should be structured to withstand scrutiny from opposing counsel, insurance adjusters, expert witnesses, and the court.

Initial Document Review and Information Gathering

Begin by conducting a thorough search of all uploaded case documents to identify and extract critical information about the claimant, the incident, and the resulting injuries. Your search should surface concrete facts including the claimant's full legal name, date of birth, contact information, the precise date and location of the incident, the nature of the accident or injury-causing event, all documented injuries and diagnoses, treatment providers and facilities, employment information including employer names and job titles, wage and earnings data, medical bills and expenses, and any correspondence from employers or medical providers. As you locate relevant information, note the source document and page number for each fact to establish a clear evidentiary foundation. If critical information appears to be missing from the uploaded documents, identify these gaps specifically so they can be addressed through additional discovery or client communication.

Establish the foundational purpose of this economic analysis in your introduction by clearly identifying the claimant, the date and nature of the incident giving rise to the claim, and the scope of injuries sustained. Provide sufficient context about the accident or incident, including when and where it occurred, the parties involved, and the causal relationship between the incident and the claimant's economic losses. Your introduction should set the stage for why these economic calculations are necessary and what time periods they will cover, distinguishing clearly between past losses already incurred and future losses reasonably certain to occur.

Claimant Profile and Comprehensive Background

Develop a detailed profile of the claimant that establishes their identity and provides essential context for the economic analysis. Present the claimant's full legal name, date of birth, Social Security number if appropriate for the jurisdiction and purpose, current address, and contact information. Include a concise but thorough summary of the nature and extent of injuries, drawing directly from medical records and treatment notes found in the case documents. Your injury summary should include all diagnoses provided by treating physicians, a chronological account of treatment received from the date of injury through the present, the current medical status including any ongoing treatment or therapy, the prognosis as documented by medical providers including expected recovery timeline or permanency of impairment, and any permanent impairments, disabilities, or work restrictions that affect the claimant's ability to work.

Search the case documents for medical records, treatment notes, diagnostic reports, and physician correspondence to extract specific medical findings. Quote directly from medical providers when describing restrictions or limitations, and cite the specific medical record, date, and provider for each medical fact. This background establishes the human context for the economic calculations that follow and demonstrates how the injuries have materially affected the claimant's life and livelihood.

Employment History and Pre-Injury Earnings Analysis

Present a detailed chronological account of the claimant's employment history, with particular emphasis on the employment situation immediately preceding the injury. Search the uploaded documents for employment records, pay stubs, W-2 forms, tax returns, employer verification letters, employment contracts, and any correspondence with employers. For the primary employer at the time of injury, extract and present the complete business name, address, supervisor or human resources contact information, the claimant's job title and employment start date, and a detailed description of job duties and responsibilities drawn from employment records or employer letters.

Document the claimant's regular work schedule by analyzing pay stubs and employer statements to determine hours per week, shift patterns, and any overtime typically worked. Calculate and present pre-injury earnings with precision by examining pay stubs from the twelve to twenty-four months preceding the injury to establish base hourly wage or annual salary with effective dates of any raises or changes, average overtime earnings over the relevant period with month-by-month or pay-period-by-pay-period detail, bonuses, commissions, or other variable compensation with documentation of payment patterns and amounts, the value of the benefits package including health insurance premiums, retirement contributions, and other employer-provided benefits, and any secondary employment or income sources that were affected by the injury.

Create a clear table or chart showing the claimant's earnings for each month or quarter in the pre-injury period, with separate columns for base wages, overtime, bonuses or commissions, and total compensation. Calculate average monthly and annual earnings, noting any seasonal variations or trends. If the claimant had a pattern of career advancement or anticipated promotions, search for performance reviews, promotion history, or employer statements documenting this trajectory. Support all earnings figures with specific citations to pay stubs, W-2 forms, tax returns, and employer verification letters, noting the document name and date for each supporting piece of evidence.

Past Lost Wages: Detailed Calculation Methodology

Calculate past lost wages from the date of injury through the present date or through the date of maximum medical improvement if applicable, using a methodical, well-documented approach. Begin by establishing the claimant's baseline earning capacity immediately before the injury, using actual earnings data from the most representative period, typically the twelve months preceding the injury, adjusted for any known anomalies such as unpaid leave, temporary layoffs, or unusual overtime periods.

For each pay period during the loss period, calculate what the claimant would have earned absent the injury by applying the baseline earnings rate, accounting for regular wages based on the claimant's normal work schedule, predictable overtime based on historical patterns documented in pre-injury pay stubs, scheduled raises or cost-of-living adjustments that would have occurred based on employment contracts or employer policies, and any bonuses or commissions that would have been earned based on past performance patterns and employer confirmation.

Search the case documents for any evidence of actual earnings received during the loss period, including wages from modified duty work, disability payments that offset wage loss such as short-term or long-term disability benefits, workers' compensation temporary disability payments if applicable, or earnings from alternative employment undertaken during recovery. Subtract these actual earnings from the calculated "but for" earnings to determine net lost wages for each period.

Present the net lost wages calculation clearly in a table format showing each month or quarter during the loss period, with columns for calculated "but for" earnings, actual earnings received, and net lost wages. Provide a running total and a grand total of past lost wages. Address tax implications by calculating both gross lost wages and after-tax lost wages, noting that jurisdictions vary in whether damages are calculated on a gross or net basis. Include lost benefits as a separate line item, calculating the value of health insurance that was lost or that the claimant had to replace at their own expense, retirement contributions that would have been made by the employer, and other benefits such as paid time off, life insurance, or other perquisites that were lost.

For each calculation, cite the specific source documents that support the figures, including pay stub dates, employer letter dates, and disability payment records. If there are any gaps in documentation or periods where earnings must be estimated, clearly identify these and explain the reasonable basis for the estimation.

Future Economic Loss and Diminished Earning Capacity Analysis

Project future economic losses with reasonable certainty based on medical prognosis, vocational assessment, and sound economic principles. Search the case documents for medical opinions regarding the claimant's future prognosis, including statements about expected recovery timeline, permanency of impairment, work restrictions or limitations, and ability to return to pre-injury employment. Look for vocational expert reports or opinions, if available, that assess the claimant's residual employability and earning capacity given their restrictions.

Begin by establishing the claimant's work-life expectancy, considering their current age, occupation and typical retirement age for their profession, health status prior to injury, and any other factors that would affect expected working years. Distinguish clearly between temporary future losses, if the claimant is expected to return to full capacity at a future date, and permanent losses, if the claimant has sustained a permanent reduction in earning capacity.

For temporary future losses, calculate the expected duration of continued wage loss based on medical opinions about recovery timeline, and apply the same methodology used for past lost wages. Account for probable wage increases by examining the claimant's pre-injury wage history for patterns of raises and applying a reasonable annual increase rate, inflation adjustments using published economic data or accepted inflation rates, and career advancement that would have occurred based on the claimant's employment history and employer statements about promotion potential.

For permanent diminished earning capacity, establish the claimant's pre-injury earning capacity trajectory by projecting their baseline earnings forward over their work-life expectancy, incorporating reasonable assumptions about wage growth, promotions, and career advancement. Then determine their post-injury earning capacity based on medical restrictions documented in treatment records and physician opinions, vocational limitations and the types of work the claimant can still perform, and labor market realities regarding available positions and wage rates for work within the claimant's residual capacity.

The difference between the pre-injury earning trajectory and the post-injury earning capacity, calculated over the work-life expectancy and reduced to present value using appropriate discount rates, represents the future economic loss. When calculating present value, use discount rates that are legally appropriate for your jurisdiction, typically based on Treasury rates or other conservative investment returns. Show your present value calculations clearly, including the discount rate used, the formula applied, and the resulting present value for each year of projected loss.

Address the following critical elements in your future loss analysis through narrative explanation supported by specific evidence from the case documents: medical evidence supporting permanency of restrictions or limitations, with direct quotes from treating physicians and citations to medical records; vocational expert opinions on the claimant's residual employability and earning capacity, if such opinions are available in the case file; present value calculations using legally appropriate discount rates with clear explanation of the rate selected and its source; consideration of both wage losses and lost benefits over the projection period, including the ongoing value of employer-provided health insurance and retirement contributions; and sensitivity analysis showing how different assumptions about recovery timeline, earning capacity, discount rates, or work-life expectancy affect the total projection.

If the claimant can return to work but only in a reduced capacity or lower-paying position, document the wage differential by comparing the pre-injury earning capacity to the post-injury earning capacity in the alternative position, and project this loss over the remaining work-life expectancy. Support the post-injury earning capacity with evidence of actual job offers, labor market data for similar positions, or vocational expert opinions.

Medical Expenses and Future Care Costs

Comprehensively catalog all medical expenses and treatment costs that flow from the injury by searching the uploaded documents for medical bills, explanation of benefits statements, payment records, receipts, and any life care plans or future medical cost projections. Organize past medical expenses in a detailed table showing the date of service, provider name and type of service, amount billed, amount paid by insurance, amount paid out-of-pocket by the claimant, and the current status of the bill.

Categories of past medical expenses should include emergency treatment and ambulance transport, hospitalization and inpatient care, surgical procedures, physician visits including specialists, physical therapy and rehabilitation services, diagnostic testing and imaging, prescription medications, durable medical equipment such as crutches, braces, or wheelchairs, and any other treatment directly related to the injury. For each category, provide a subtotal and cite the specific bills or payment records that support the amount claimed.

Distinguish clearly between past medical expenses that have already been incurred and documented, and future medical expenses that are reasonably certain to be required based on medical prognosis. For future medical costs, search the case documents for opinions from treating physicians regarding the need for future treatment, including ongoing therapy or rehabilitation, future surgical procedures, long-term medication needs, medical equipment replacement or upgrades, and periodic follow-up examinations or monitoring.

If a life care plan has been prepared by a qualified expert, summarize its findings and incorporate its cost projections, citing the specific sections of the life care plan that address each category of future care. If no formal life care plan exists, compile the future medical needs identified in physician reports and treatment notes, and obtain cost estimates by referencing current medical bills for similar services, published medical cost data, or quotes from providers. Calculate the present value of future medical expenses using the same discount rate methodology applied to future wage loss, and present both the nominal total and the present value.

Household Services, Transportation, and Other Economic Losses

Document all other economic losses beyond wage loss and medical expenses that directly result from the injury. Search the case documents for evidence of household services the claimant can no longer perform or can perform only with difficulty, such as home maintenance and repairs, yard work and landscaping, childcare and supervision of children, housecleaning and laundry, meal preparation, or vehicle maintenance. If the claimant or family members have provided statements about these limitations, quote from those statements and cite the source document.

Calculate the replacement cost of these services at market rates by obtaining quotes from service providers in the claimant's geographic area, referencing published data on household service costs, or using reasonable hourly rates for each type of service multiplied by the hours per week or month that the claimant can no longer perform these tasks. Distinguish between past household services losses already incurred and future household services losses that will continue based on permanent limitations.

Compile transportation costs for medical appointments by reviewing medical records to identify all treatment visits, calculating mileage to and from each provider at the applicable mileage rate, and adding parking fees or public transportation costs if documented. If family members have provided transportation, calculate the value of their time and mileage as well.

Identify costs of home modifications or adaptive equipment necessitated by the injury, such as wheelchair ramps, bathroom modifications, specialized furniture or bedding, or assistive devices, by searching for receipts, invoices, or estimates in the case documents. Include any other out-of-pocket expenses directly caused by the injury that are documented in the case file, such as costs of hiring help for tasks the claimant can no longer perform, expenses for over-the-counter medications or supplies, or costs of replacing damaged property.

For each category of economic loss, provide a clear calculation showing the basis for the amount claimed, the time period covered, and the total. Support each category with specific citations to receipts, invoices, estimates, statements, or other documentary evidence, noting the document name and date.

Evidentiary Foundation and Supporting Documentation

Establish a robust evidentiary foundation for every calculation and assertion in the report by creating a comprehensive exhibit list that references all supporting documentation, organized by category. For employment and wage loss claims, identify and list all pay stubs covering the relevant pre-injury period with dates and amounts, W-2 forms for the past two to three years, federal and state tax returns for the same period, employer verification letters on company letterhead confirming employment dates, position, wages, and lost time, and any employment contracts or offer letters establishing compensation terms.

For medical expenses and future care needs, compile and list all medical bills and payment records with provider names and dates of service, health insurance explanation of benefits statements, medical records documenting treatment and prognosis with specific citations to physician opinions about restrictions and future needs, life care plans or future medical cost projections from qualified experts if available, and receipts for out-of-pocket medical expenses.

For other economic losses, gather and list receipts and invoices for all claimed expenses, quotes or estimates for future costs such as home modifications or ongoing services, and expert reports from vocational experts, economists, or other qualified professionals who have evaluated the claim. For each expert opinion relied upon, verify that the expert's credentials are documented in the case file and note their qualifications, and confirm that their methodologies appear to comply with applicable evidentiary standards such as Daubert or Frye depending on jurisdiction.

As you compile the exhibit list, organize it logically by category of damages, number each exhibit sequentially, and provide a brief description of each exhibit and its relevance to the damages calculation. This exhibit list will serve as an appendix to the report and will allow readers to quickly locate the supporting documentation for any figure or assertion in the report.

Comprehensive Summary of Total Economic Damages

Conclude with a clear, organized summary that presents the total economic loss in a format that is immediately comprehensible to attorneys, insurance adjusters, judges, and potentially jurors. Create a summary table that breaks down total damages into major categories with the following structure: Past Lost Wages with the specific date range from injury through the present or maximum medical improvement and the total amount; Future Lost Wages or Diminished Earning Capacity with the projection period, the present value calculation, and the total amount; Past Medical Expenses with the total amount incurred to date; Future Medical Expenses with the present value and the total amount; and Other Economic Losses including household services, transportation, home modifications, and miscellaneous expenses with subtotals for each category and a total.

Provide both a gross total of all economic damages and, if applicable to your jurisdiction, an after-tax or net total. Include a brief narrative summary of one to two paragraphs that contextualizes these figures, explaining the most significant drivers of the total loss such as the severity of permanent impairment, the claimant's young age and long work-life expectancy, or the need for extensive future medical care, and highlighting any particularly compelling aspects of the economic impact such as the loss of a promising career trajectory or the inability to care for young children.

Address any potential challenges or weaknesses in the calculation methodology and explain how you have addressed them conservatively, such as by using conservative wage growth assumptions, applying appropriate discount rates that may reduce future loss projections, or excluding speculative elements of damage. If there are ranges or uncertainties in any projections, such as uncertainty about the extent of future medical needs or the claimant's actual post-injury earning capacity, present both conservative and more aggressive scenarios to give the reader a sense of the reasonable range of damages, clearly labeling which scenario you consider most likely and why.

Conclude with a statement regarding the reliability of the calculations and the strength of the evidentiary support, positioning the report as a credible, defensible foundation for settlement negotiations or trial presentation. Note any areas where additional documentation or expert opinion would strengthen the analysis, such as the need for a formal vocational evaluation, a life care plan from a certified life care planner, or an economist's report on present value calculations and earning capacity projections.

Report Standards and Quality Assurance

Throughout the entire report, maintain objectivity and precision by presenting facts and calculations without advocacy or emotional language, while still clearly conveying the magnitude of the claimant's losses. Use clear, professional language that is accessible to non-economists while maintaining technical accuracy in all calculations and economic concepts. All calculations should be transparent and replicable, with formulas and assumptions clearly stated so that opposing experts or the court can verify your methodology.

The report should anticipate and preemptively address common challenges to economic damage calculations, such as failure to mitigate damages by explaining what efforts the claimant has made to return to work or find alternative employment, pre-existing conditions affecting earning capacity by distinguishing between pre-existing limitations and injury-related limitations, alternative explanations for income variations by addressing any anomalies in the pre-injury earnings history, or questions about the reasonableness of future projections by grounding all projections in documented medical opinions and conservative economic assumptions.

Before finalizing the report, verify that every factual assertion is supported by a citation to a specific document in the case file, every calculation is shown with sufficient detail that it can be replicated, all exhibits referenced in the report are included in the exhibit list and are available, and the report flows logically from the incident and injuries through each category of damages to the final summary. Your goal is to produce a document that serves as both a comprehensive accounting of economic harm and a persuasive tool in achieving fair compensation for the claimant, while maintaining the credibility and objectivity necessary to withstand scrutiny from all parties in the litigation.