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How Lost Wages Are Calculated in Injury Claims  

May 22, 2024Personal Injury

A personal injury claim in Colorado offers a chance for an injured accident victim to recover financial compensation for losses suffered in an accident. This includes the potential to recover lost wages, or income lost from the inability to work due to the injury. Properly calculating your lost wages is important if you wish to collect fair compensation for this type of loss during an injury claim.

What Are Lost Wages?

Lost wages refer to job income and other earning opportunities, such as tips or commissions, that are lost due to the inability to work because of an injury. If an injury prevents an individual from immediately returning to work, the individual may qualify for lost wage replacement for work hours missed while in recovery. 

Lost wages can also include lost earning capacity, or the estimated amount of income the victim likely would have earned in the future were it not for a long-term injury. This type of damage award is most common in cases involving catastrophic or permanent injuries and disabilities, such as traumatic brain injuries and spinal cord injuries.

How Are Lost Wages Calculated?

Lost wages are a type of economic damage that can be paid to a victim through a successful personal injury claim in Colorado. An insurance company may offer to cover full or partial lost wages as part of a settlement offered to a claimant to resolve a legal dispute. Your lost wages as an accident victim will be calculated differently depending on how you were paid prior to the accident.

Hourly Wage

Take the amount of your hourly wage and multiply it by the number of hours missed due to the injury. For example, if you made $15 an hour and missed five eight-hour shifts (40 hours total), you would multiply $15 x 40 = $600.


Take your annual salary and divide it by the number of work hours in a year (2,080), then multiply it by the number of hours missed. For example, if you earned a salary of $40,000 and missed five days of work, you would divide $40,000 / 2,080 = $19.23, then multiply $19.23 x 40 hours = $769.


If you work as an independent contractor or sole proprietor, you must claim lost income, which means the amount of earnings you would have made were it not for the injury. This requires proof of what you made on average before the accident, such as profit and loss statements or invoices.

How to Ensure You Receive a Fair Amount for Your Lost Wages

An accurate lost wage calculation must take factors into account such as typical overtime payments, sales commissions, tips and promotion opportunities in addition to average wages. In addition, you must calculate your future lost earning capacity if your doctor believes your injury will take you out of work for the foreseeable future.

It is essential for you to check a lost wage calculation to ensure it fairly and accurately represents your amount of past and future lost earnings. The best way to ensure you receive a fair settlement is by getting help from an attorney. A personal injury attorney in Denver can accurately calculate your lost wages and negotiate with an insurer for maximum compensation on your behalf.