Earning Capacity Assessment: A Defensible Methodology
How a forensic vocational evaluation establishes pre- and post-event earning capacity in a way that withstands scrutiny.
Vocational · 11 min read
Abstract
Earning capacity is a measure of what an individual is able to earn in the open labor market given education, training, work history, and any functional limitations. It is distinct from actual earnings at a point in time and from a government or insurer disability determination. This paper sets out a transparent, replicable methodology for assessing earning capacity before and after an injury or event, and explains how each step is documented so the resulting opinion can be examined and tested by opposing counsel.
Key takeaways
Earning capacity reflects ability to earn, not the wage a person happens to receive at a given moment.
A defensible evaluation separates the pre-event capacity baseline from the post-event capacity and explains every assumption between them.
Transferable skills analysis and labor market data anchor the opinion to observable facts rather than conclusory judgment.
Documentation of records reviewed, methods applied, and limitations acknowledged is what makes the opinion testable.