Proving lost earnings requires more than showing that you were injured and your income fell. The evidence should explain what you would probably have earned without the injury, what you actually received, why the difference arose and how each figure was calculated. Employees, self-employed people and company owners need different records, and a bank balance alone rarely answers every question.
This guide concerns earnings evidence in personal injury claims in England and Wales. Its practical asset is an earnings evidence log that links each period of claimed loss to payroll, business and medical information. The examples are invented arithmetic illustrations, not predictions of recoverable compensation or individual tax advice.
Alexander James Solicitors considers enquiries on private-fee terms agreed in writing and does not offer legal aid. If earnings are a significant part of your claim, explain your working arrangement, the absence or reduced-work period and the records available. Ask for a defined assessment before assuming the firm will calculate losses, contact an employer or instruct an accountant.
Start with the comparison the evidence must support
Identify the position without the injury
The starting question is what would probably have happened if the injury had not occurred. For a person with a stable salary, the comparison may be relatively straightforward. For someone with fluctuating overtime, seasonal work, a new contract or an expanding business, the expected earnings need a reasoned explanation supported by records.
Avoid choosing the highest recent month simply because it produces the largest loss. Ask whether that month was representative or included an unusual bonus, unusually long hours or a payment for earlier work. Equally, a low month caused by a temporary interruption may understate normal earnings. The period used should be appropriate to the working pattern and explained transparently.
A useful baseline note states the employment or business model, ordinary hours, pay components and known changes expected before the accident. Preserve the documents supporting a planned pay rise or new contract. An opportunity discussed informally is different from a signed agreement, but both can be described accurately for assessment.
Identify what actually happened after injury
Record absence, reduced hours, modified duties, sick pay, a phased return and any later deterioration or recovery. Link dates to fit notes, employer records and the actual pay received. If the injury affected your ability to work only partly, explain the duties you could still perform and any assistance used.
Do not assume that every reduction after the accident was caused by the injury. Redundancy, seasonal demand, business closure or an unrelated illness may also matter. Tell the adviser about those events. An honest account allows the calculation to isolate the injury-related effect rather than presenting a misleading before-and-after difference.
Separate the financial calculation from medical support
Payroll may prove that income fell, but it does not alone establish why you could not work. Medical evidence may support a restriction, but it does not establish the amount of a commission payment or business profit. The strongest file connects both sides: the reason for reduced capacity and the financial consequence.
Practice Direction 16 provides for a schedule of claimed past and future losses in relevant personal injury proceedings. Your working log helps prepare that formal account. It should be clear enough that an adviser can trace a figure to its source and identify assumptions or missing evidence.
Employee records: establish the pay pattern
Gather a coherent payroll period
Collect payslips covering a suitable period before the injury and the period of claimed loss. Include annual summaries and employment terms where relevant. The appropriate baseline depends on your pattern, so ask the solicitor what range is needed rather than sending one convenient payslip and assuming it represents the year.
The government's payslip guidance explains the distinction between pay before and after deductions and information shown on payslips. For a claim, preserve the complete document. A screenshot of the net amount may omit overtime, sick-pay codes or deductions that explain why two months differ.
If the payroll format changes, obtain a short explanation from the employer. A new code or salary-sacrifice arrangement can make a simple comparison misleading. Keep the original records and any payroll clarification together so that the calculation can be checked later without reconstructing the query.
Distinguish salary, overtime and variable pay
Record basic salary separately from overtime, shift allowances, commission, bonuses and other components. Ask what evidence supports the expectation of each variable element. Historical payments, rotas, sales records or scheme terms may be relevant. A discretionary payment should not be presented as guaranteed without a basis.
If overtime was regularly available before injury, preserve the pattern and any evidence of what colleagues or the business did during your absence where lawfully available. Do not obtain colleagues' private payroll records without authority. The adviser can consider an appropriate employer confirmation or other evidence without indiscriminate collection of third-party data.
Commission may be paid after the work generating it. Identify the earning period as well as the payment date. A payment received during absence may relate to pre-injury work, while a later shortfall may reflect the period when you could not generate sales. The timing needs explanation rather than automatic allocation to the month it reached the bank.
Explain deductions and net loss
A personal earnings loss should not be calculated by treating gross pay as though it were the amount normally available to spend. Tax, National Insurance and other deductions can affect the appropriate comparison. The actual treatment needs advice, particularly where variable pay, pension arrangements or unusual deductions are involved.
Do not attempt to correct payroll by using a guessed tax rate. Provide the records and identify the issue. If a payslip includes a one-off repayment or correction, ask payroll for an explanation. A precise financial schedule depends on understanding those entries, not simply subtracting one headline figure from another.
Sick pay and other payments: record before adjusting
Identify the source and terms of sick pay
Keep the employment contract, sick-pay policy, payroll entries and correspondence about entitlement. Distinguish statutory payments from contractual arrangements and any discretionary support. Ask whether there is a repayment obligation linked to recovery of damages and provide the wording for legal assessment.
Do not assume that receiving sick pay means there is no claim for any earnings-related loss. It may cover only part of normal income or end before return to work. Equally, do not claim the full normal wage for a period in which substantial pay continued without explaining that receipt. The calculation must deal accurately with what was paid and its legal treatment.
Track when pay changes
Create a timeline showing normal pay, reduced pay, any later reduction and the return-to-work arrangement. Record the date the employer says a change takes effect and check the actual payslip. Payroll periods can lag behind absence dates, so a month's bank receipt may not correspond neatly to that month's work.
If a household shortfall is urgent, tell the solicitor before a known reduction occurs. That may help identify a need for advice about interim support, but it does not guarantee a payment. A supported timeline is more useful than waiting until the account is overdrawn and assuming final settlement can be accelerated immediately.
Insurance, benefits and employer advances need separate entries
Record relevant payments with the payer, date, purpose and terms. Their treatment can differ, so neither ignore them nor subtract all of them indiscriminately. Give the adviser policy documents and letters rather than relying on the description in a bank statement.
A payment described as a loan, wage advance or insurance benefit may have consequences different from ordinary salary. If repayment is requested, preserve the request and obtain advice on its effect. The earnings log should show the facts clearly so the legal calculation can be made correctly.
Reduced hours and a phased return
Record the actual arrangement, not just the return date
A return to work can involve shorter shifts, fewer days, lighter duties or assistance. Keep the agreed plan, review notes and actual hours worked. A record saying “returned on 1 September” may conceal a continuing income shortfall or a temporary arrangement that could not be sustained.
Explain whether reduced hours were medically advised, proposed by the employer or chosen for another reason. Preserve relevant clinical and occupational information. The adviser needs to connect the continuing loss with the injury rather than assume any part-time work after an accident is automatically recoverable.
Include unsuccessful attempts honestly
If you attempted normal duties but had to reduce them again, record the dates, tasks, symptoms and communications. Do not describe the attempt as though it never occurred because it complicates the timeline. It may provide useful evidence about capacity, but the account needs to be accurate and supported.
Likewise, record improvements and successful increases in hours. A claim should reflect the real recovery path. The article on returning to work during an injury claim addresses planning and evidence in more detail. The earnings calculation should follow the actual arrangement rather than an outdated estimate of absence.
Separate workplace adjustments from wage replacement
An employer may maintain salary while colleagues absorb tasks or the claimant works more slowly. That may mean there is little immediate net earnings loss, while other questions about future capacity or assistance remain. Explain the arrangement without inventing a salary loss that did not occur.
Conversely, a worker may perform the same nominal role with fewer paid hours. The job title then hides the financial effect. Use hours, pay and duties together. A clear description helps prevent either overstating loss or overlooking a genuine shortfall.
Variable-hours, agency and multiple-job work
A zero-hours contract does not make evidence impossible
Where hours vary, the task is to show the pattern and likely work available, not to assume a guaranteed wage that the contract did not provide. Preserve shift offers, accepted rotas, platform records and past payments. Explain cancellations and any normal seasonal variation.
The dedicated guide for injury on a zero-hours contract addresses that working arrangement. For the earnings log, distinguish shifts already booked from possible future work and record the basis for each estimate. A realistic probability supported by a pattern is different from claiming every available shift as certain income.
Agency work needs both placement and payment records
Identify the agency, end client, placement dates, usual hours and payment arrangements. A placement may end for reasons unrelated to injury, or a further placement may have been expected but not confirmed. Provide the messages and contracts so the adviser can assess the position rather than relying on an assumed continuous assignment.
If the agency offered alternative work, record the duties, hours, location and your response. Explain any medical or practical reason it was unsuitable. Do not omit the offer because you fear it weakens the claim. Its significance depends on the actual circumstances and should be assessed with the rest of the evidence.
Keep separate schedules for separate jobs
If you had more than one job, record each income stream independently before combining appropriate losses. The injury may affect one role more than another. Continuing office work does not necessarily show ability to perform a physically demanding second job, but the distinction needs a clear account of duties and medical limitations.
Avoid using total bank deposits without identifying their source. Reimbursements, transfers between your accounts and income from unrelated activities can distort the total. A separate schedule for each role makes the calculation easier to test and reduces accidental double counting.
Self-employed losses: turnover is not the same as income lost
Describe how the business earns money
Begin with a short explanation of services, customers, pricing, seasonal patterns and your personal role. Identify which work could continue without you and which depended on your labour or decisions. The financial records become more meaningful when the adviser understands the business model.
A fall in turnover can be relevant, but it is not automatically the same as lost profit or personal income. Some costs may have been saved, work may have been postponed, or a substitute may have completed jobs at a cost. The calculation needs to identify the actual economic consequence attributable to injury.
Preserve accounts and the records behind them
Gather tax returns, accounts, invoices, booking records, bank statements and expense information for an appropriate period. An annual total may obscure a seasonal business or a short but significant interruption. Monthly or job-level records can help explain the pattern where available.
Do not alter historical accounts to align them with the claim. If there is an error or an undeclared issue, tell the legal and accounting advisers so it can be addressed properly. A litigation schedule should not become a vehicle for inventing income or concealing inconsistent records.
Separate cancelled, postponed and replaced work
For each affected job, record whether it was cancelled entirely, completed later, transferred to another provider or completed by paid assistance. These outcomes create different financial questions. Claiming the whole invoice for postponed work that was later completed can overstate the loss if the later receipt is ignored.
Replacement labour may preserve turnover while reducing profit. Keep the agreement, invoice and payment record, and explain what work the replacement performed. If the replacement also completed unrelated work, separate it. The adviser can then assess the reasonable injury-related expenditure without treating every business payment during recovery as a claim item.
Company owners need advice on who suffered the loss
A limited company is distinct from its owner. Salary, dividends, company profit and personal drawings cannot simply be combined into one personal earnings claim. Explain the structure and provide accounts and remuneration records. The correct claimant, recoverable loss and treatment of business consequences may require specialist legal and accounting analysis.
Do not assume that money remaining inside the company is identical to money you personally lost, or that a drop in dividends automatically proves the accident caused it. The relationship needs evidence. A clear explanation of your role and remuneration is the starting point for advice, not a substitute for it.
Practical asset: earnings evidence log
Use one row for each distinct period
Split the timeline when pay, hours, duties or capacity changes. The log below is a collection tool; the solicitor or accountant should assess the final calculation and legal treatment. Use document references so each figure can be checked.
| Field | What to enter | Supporting material |
|---|---|---|
| Period | Start and end dates | Absence, rota or business chronology |
| Working position | No work, reduced hours, adjusted duties or normal work | Employer plan, diary or job records |
| Expected earnings | Supported estimate without injury | Baseline payslips, contract, bookings or accounts |
| Actual receipts | Pay and relevant income actually received | Payslips, statements and remittance records |
| Other payments | Sick pay, insurance, advances or benefits for assessment | Terms, policy or correspondence |
| Injury connection | Why capacity or work changed | Medical evidence and workplace records |
| Saved or added costs | Relevant business adjustments or replacement labour | Invoices and accounts |
| Uncertainty | Missing record or disputed assumption | Gap note and request history |
| Review status | Provisional, checked or updated | Adviser or accountant's explanation |
Do not total the expected and actual columns blindly if they use different bases. A gross expected wage cannot be compared directly with a net bank receipt without appropriate treatment. Likewise, turnover should not be compared with personal drawings. Label the basis of each number before calculations are performed.
Add a source note for each assumption
A source note explains why the baseline is appropriate. “Average of representative monthly net pay before injury, excluding an identified one-off repayment” is more useful than “usual earnings”. For a business, explain whether the comparison uses the same season in earlier years and what changed independently of injury.
Where a figure is estimated, identify the method and limitation. A pending employer confirmation should be marked pending. The file should not acquire false certainty merely because a spreadsheet displays two decimal places. The adviser needs to know what is established and what remains an assumption.
Keep revisions visible
When a new payslip or account changes the calculation, update the relevant period and preserve the earlier version. Note the reason for the change. This helps explain why a schedule supplied during early negotiations differs from the later final schedule.
Avoid maintaining several competing spreadsheets without a clear master version. Ask who is responsible for the formal schedule and how you should supply updates. Your own log can support it, but an uncoordinated recalculation sent directly to the insurer can create confusion about the amount claimed.
Worked examples: different records answer different questions
A salaried employee with partial pay
Assume, purely for illustration, that a worker would have received £2,000 net in a representative month and received £1,250 during an injury-related absence. The initial difference is £750. The adviser still needs to verify the baseline, the reason for absence and the nature of the £1,250, including any relevant repayment or adjustment terms.
If the £2,000 included an unusual payment that would not have recurred, the comparison needs correction. If payroll later reimburses £200 relating to the same period, the log needs updating. The arithmetic is simple; the evidence determines whether the numbers and treatment are appropriate.
A self-employed contractor using replacement labour
A hypothetical contractor keeps a £4,000 job by paying another worker £1,200 to perform the physical tasks during recovery. The entire £4,000 invoice is not automatically lost income because the business still received it. The relevant question may involve the additional cost, any saved expenses and the contractor's remaining contribution.
The file should contain the customer invoice, replacement-worker agreement, payment record and explanation of the task. If the replacement also undertook an unrelated project, separate that cost. The example illustrates why a turnover-only calculation can miss the real loss or substantially overstate it.
A seasonal worker injured before a busy period
A worker's recent low-season pay understates the income usually earned during the forthcoming busy months. Historical rotas and payments from comparable periods, together with confirmed bookings, may help assess the expected work. The claimant should also disclose any reason demand would have changed this year, such as an employer reducing operations.
The adviser should not automatically use either the lowest recent month or the highest historical month. The evidence must support a realistic counterfactual. A range may initially be necessary until employer or business records clarify the position.
Future earnings: the evidence task extends beyond a multiplication
Define the work limitation and likely duration
A future earnings claim needs an assessment of the effect of injury on work, not simply an assumption that current absence lasts until retirement. Medical prognosis, actual duties, possible adjustments, skills and employment circumstances can all matter. Ask which evidence is needed to support the proposed future scenario.
If you hope to change career, explain the plan and its basis. A pre-injury training course or accepted offer differs from an ambition first considered during litigation. Both may be relevant to personal planning, but they should not be presented as equally certain earnings trajectories.
Understand the assumptions behind a future-loss calculation
The Ogden tables published by the Government Actuary's Department are a recognised actuarial resource for assessing future losses. Their use requires appropriate factual and legal assumptions. Multiplying one year's shortfall by the number of years to retirement is not automatically an adequate valuation method.
Ask the adviser to explain the earnings basis, period, contingencies and any specialist input. You should understand the key assumptions even if you do not reproduce the calculation. If the assumed job or return date does not reflect your circumstances, provide the evidence showing why.
A current full salary does not answer every future question
Some employers maintain pay through a supportive arrangement that may be temporary. Others provide a role with fewer progression opportunities. Whether this supports a future claim requires evidence and careful analysis; it is not established simply by expressing concern about job security.
Keep the arrangement and review correspondence, and explain what is known rather than predicting dismissal or reduced promotion as certain. The adviser can assess the realistic risks and the evidence needed. Avoid turning understandable anxiety into an unsupported financial forecast.
Common evidence problems and how to address them
Cash income or incomplete records
Tell the adviser honestly how income was received and recorded. Gather legitimate records such as invoices, bookings, receipts and tax information. Do not create backdated documents or describe reconstructed estimates as contemporaneous accounts. If tax compliance or record accuracy is an issue, obtain appropriate advice rather than concealing it.
Incomplete records do not justify abandoning accuracy. A clear explanation of the gap and available alternatives gives the adviser a basis to assess proof and risk. The claim should not be built on a total that cannot be reconciled with the business or employment history.
An employer will not provide a letter
Preserve the request and response, and tell the solicitor what is missing. Payslips, rotas, contracts, messages or other lawful records may help. The representative can consider an appropriate further request or procedural route. Do not pressure colleagues to sign a statement outside their knowledge or access payroll without authority.
A factual employer letter should explain the records and arrangements rather than simply state that the claimant deserves compensation. Ask for the information needed: absence dates, usual hours, pay changes or the terms of a phased return. A precise request is easier to answer and more useful as evidence.
Family care and earnings must not be merged
A relative may take time off work to help you. Record that separately from your own earnings loss and provide the facts for advice on the appropriate claim. Do not simply add the relative's full salary loss to your schedule without legal assessment.
The guide on recording unpaid care from a relative explains the care-evidence task. Keeping assistance and earnings in separate sections helps avoid claiming the same practical consequence twice under different headings.
Frequently asked questions
1. Are payslips enough to prove my lost earnings?
Payslips are important, but they may not answer every question about the baseline, variable pay, absence or injury connection. Provide employment terms, absence dates and relevant medical evidence as well. If entries are unclear, obtain payroll clarification. The adviser needs to understand what you would probably have earned, what you actually received and why the difference arose.
2. Should I calculate the claim using gross or net salary?
Do not assume gross salary equals the recoverable personal loss. Tax, National Insurance and other adjustments may affect the calculation. Supply complete payroll records and ask the adviser to explain the basis used. Avoid applying a guessed tax percentage or comparing a gross expected figure with a net bank payment without appropriate treatment and clear labelling.
3. Can regular overtime be included?
It may be relevant if the evidence supports that it would probably have been available and worked. Preserve the historical pattern, rotas and any appropriate employer confirmation. Distinguish regular overtime from a one-off exceptional period. The adviser should assess the likelihood and amount rather than treating every possible extra shift as guaranteed earnings lost because of injury.
4. Does receiving sick pay mean I have no earnings claim?
Not necessarily. Sick pay may cover only part of normal income, end during recovery or carry terms requiring assessment. Provide the policy, payslips and correspondence. The calculation should account for what was received and its legal treatment. Do not claim a full wage loss while omitting sick pay, but do not assume every payment automatically eliminates every earnings-related issue.
5. What if my employer says sick pay must be repaid from compensation?
Give the solicitor the exact contractual wording and repayment request. The obligation and its effect need assessment rather than assumption. Record the amount and period concerned, and do not agree an unexplained deduction without advice. A clear account of the employer's position allows the earnings schedule and eventual settlement accounting to address the issue consistently.
6. Can I claim after returning on reduced hours?
A continuing shortfall may be relevant if it is supported and attributable to the injury. Keep the phased-return plan, actual hours, pay records and medical information. Returning to work is not a single all-or-nothing event. The calculation should reflect the changing arrangement and any later improvement, rather than continuing to claim full absence after some earnings resume.
7. How do I prove earnings on a zero-hours contract?
Preserve shift offers, accepted rotas, historical payments and evidence of the normal pattern. Distinguish booked work from uncertain future opportunities. The absence of guaranteed hours does not make all evidence irrelevant, but it means the expected earnings need a reasoned basis. Explain seasonal changes and other factors so the assessment does not assume every available shift would have been worked.
8. Is my business turnover the amount I have lost?
Not automatically. Turnover differs from profit and personal income, and some costs may have been saved or work completed later. Replacement labour may preserve revenue while creating an additional expense. Provide accounts and job-level records with an explanation of how the business operates. The adviser or accountant can then assess the actual injury-related financial consequence.
9. What if customers postponed work rather than cancelling it?
Record the original booking, postponement and later completion or payment. The timing and any additional cost matter. Claiming the full invoice as permanently lost while ignoring later receipt can overstate the loss. There may still be a genuine consequence, but it needs to be identified accurately rather than treating every delayed job as though it disappeared entirely.
10. Can replacement-worker costs support my claim?
They may be relevant where reasonably connected with the injury, but preserve the agreement, invoice, payment and description of work. Separate unrelated tasks and account for any costs saved. The fact that someone was paid during your recovery does not establish that the whole payment is recoverable. A clear explanation lets the adviser assess the appropriate treatment.
11. How should I deal with more than one job?
Prepare a separate timeline and calculation for each role before combining appropriate losses. Describe the duties because the injury may affect jobs differently. Identify each income source in bank records and avoid counting transfers or reimbursements as earnings. The adviser should be able to trace the expected and actual income for each role without relying on an unexplained overall total.
12. Can I include a bonus I expected to receive?
Provide the scheme terms, historical payments and evidence supporting the expectation. A guaranteed contractual payment differs from a discretionary award or an uncertain target. Explain the earning period and any non-injury factors affecting entitlement. The adviser can assess probability and value, but the schedule should not present an anticipated bonus as certain merely because you hoped to receive it.
13. What if my salary continued but colleagues covered my work?
Explain the arrangement accurately. Continuing salary may mean no immediate net wage shortfall for that period, while other evidence about capacity or future arrangements may still matter. Do not invent a loss equal to colleagues' effort. Provide the employer's plan and any review terms so the adviser can assess the actual financial and evidential consequences.
14. Should I include money received from insurance or benefits?
Record relevant receipts separately with their source, purpose and terms for legal assessment. Different payments may have different treatment, so do not ignore them or deduct all of them indiscriminately. Give the adviser the policy or correspondence. A complete record helps avoid double counting and allows the formal schedule to explain appropriate adjustments transparently.
15. What if some of my income was paid in cash?
Explain how it was earned and recorded, and gather legitimate supporting material such as invoices, bookings, receipts and tax records. Do not create backdated evidence. If the records or tax position raise concerns, obtain appropriate advice. The assessment should reflect the true history and evidential limitations rather than an unsupported total reconstructed solely for the claim.
16. Can my relative's lost wages be added to mine?
Do not automatically combine them. A relative's time off to provide assistance raises a different issue from your own earnings loss and needs legal assessment. Record the care tasks, time, payer and employment effect separately. Keeping those facts distinct helps the adviser determine the appropriate claim and prevents the same assistance being counted under multiple headings.
17. How often should I update the earnings log?
Update it when a new pay period, work arrangement or relevant payment changes the position. Keep a clear version date and note the reason for revisions. Ask who maintains the formal schedule and how updates should be supplied. A current log is useful; several conflicting spreadsheets sent to different parties can make the claim harder to assess.
18. Is future earnings loss just annual loss multiplied by years left to work?
No simple multiplication necessarily captures the correct assessment. Future capacity, earnings assumptions, duration, contingencies and actuarial treatment may all matter. Ask the adviser to explain the factual basis and any specialist calculation. A current shortfall should not automatically be projected unchanged until retirement, especially where recovery, adjustments or alternative work remain uncertain.
19. What if my employer refuses to confirm the loss?
Keep the request and response and tell the solicitor exactly what information is missing. Other lawful records may help, and an appropriate further request or procedural step can be considered. Do not obtain private payroll information through unauthorised access. A focused request for dates, hours and pay changes is generally more useful than asking the employer to endorse the whole claim.
20. What should I send AJ Solicitors for an earnings-loss assessment?
Provide your employment or business structure, injury-related work timeline, baseline records, actual receipts, sick-pay or insurance terms and the main uncertainty. Include known deadlines and any existing schedule. The firm can consider a private-fee assessment within agreed scope. Confirm whether the work includes calculations, employer contact or accounting input before assuming those tasks have been accepted.
Build a calculation another person can check
A dependable earnings claim links each period, assumption and amount to evidence. Start with the work you would probably have done, show what actually happened and explain the injury's role in the difference. Preserve the records behind summaries and keep changes visible.
For advice, use the personal injury claims enquiry page to explain your working arrangement and the task you need assessed. Agree the scope and fees in writing. A focused earnings evidence log helps the adviser identify the real loss and the records needed to support it without relying on an inflated or incomplete headline figure.
