Motor vehicle accident claims span the full range of economic loss, and the need for an economist scales with the injury. A short absence from work with a documented return can be presented from the pay records. Once the person cannot return to the prior occupation, needs future surgery or treatment, or has lost the ability to do household work, the loss becomes a projection over a worklife and requires growth and present value assumptions that counsel should not be left to argue without an expert. The first step is to establish the work timeline: date of injury, date of any return, and the level of earnings on return.
Checklist
Establish the dates the person left work and returned, and whether the return was at full or reduced earnings
Gather tax returns, W-2s or 1099s, and pay stubs for the years before the crash and every period since
Identify fringe benefits lost during the absence or reduced on return
Determine whether future treatment has been projected by a treating provider or in a life care plan
Document the household work the person did before the crash and cannot do now
Questions to ask the economist
How do you decide whether a return to work at reduced earnings represents a permanent loss?
What records do you need to distinguish a bounded past loss from a future loss?
How do you treat overtime, seasonal work, or a second job in the earnings base?
Can you provide a preliminary range for settlement discussions before the full report?
Timeline
One to two weeks to a preliminary view from the earnings records and the work timeline. The full report follows the retention and records phases.
Required documents
Tax returns and W-2s or 1099s for the years before and after the crash
Pay stubs or employer statements showing the absence and any return to work
Benefit plan summaries
Medical opinions on work restrictions, if any have been written
Common pitfalls
Presenting the claim from pay records alone when the person's return to work is at reduced hours and the gap will continue
Overlooking self-employment or gig income that does not appear on a W-2
Leaving household services out of a claim for a person who did most of the unpaid work in the home
The injured person is back at work. Is there still an economic loss?
Possibly. If the return is at lower pay, fewer hours, or in a job with less growth or fewer benefits, the gap between the prior path and the current path continues over the remaining worklife. The economist measures that gap; a return to work does not end the claim by itself.
What drives the cost of the economic analysis in a motor vehicle case?
The number of components in scope and the condition of the records. A past-loss calculation from pay stubs and employer attendance records is a short engagement; a projection of future earnings, fringe benefits, household services, and a life care plan is a full report with sensitivity tables. Counsel can scope the engagement to the injury and expand it if the medical picture changes.
Does the economist need the police report or the medical records?
Not to start. The economist works from the earnings and benefit records, the employer's account of the absence and any return, and the medical or work-capacity opinions that describe what the person can do now. Liability documents are not part of the economic analysis, and treatment records matter only where they bear on work restrictions or on a future care projection.
References
U.S. Bureau of Labor Statistics. (n.d.). Current Population Survey (CPS). U.S. Department of Labor. bls.gov
U.S. Bureau of Labor Statistics. (n.d.). Employer Costs for Employee Compensation (ECEC). U.S. Department of Labor. bls.gov
U.S. Bureau of Labor Statistics. (n.d.). American Time Use Survey (ATUS). U.S. Department of Labor. bls.gov