Ask opposing economists specific, well-crafted questions to expose weaknesses in their reports and testimony. Here are five key questions to ask at deposition, and what you may learn from their answers.
1. Do your calculations take periods of unemployment into account?
Future earnings should usually be reduced by a projected unemployment rate. Work life expectancy considers time in the labor force, which includes periods of unemployment. For example, if the average unemployment rate for someone of the plaintiff’s age, gender, education and ethnicity is 5%, failure to adjust for unemployment inflates the future lost earnings by 5%.
2. Are there gaps in the plaintiff’s work history? If so, can you explain the gap? How did you factor it in to the lost earnings you projected?
The economist should know the reason for any gaps in the plaintiff’s work history. Gaps may be due to past injuries, periods of incarceration, or repeated terminations. If an injured party has no consistent history of holding a full-time job, it may be unreasonable to project they would have changed absent the injury. Of course, the situation is different for individuals who have not completed formal education or who left the labor force to care for children who are now grown.
3. Are projected wage growth rates and fringe benefits based on the plaintiff’s specific jobs, or on national averages?
The Bureau of Labor Statistics (“BLS”) and the Census Bureau publish occupation-specific wage statistics that economists can use to compute wage growth rates for over 500 occupations. The BLS also publishes the National Compensation Survey, which shows fringe benefits by industry. If the plaintiff has worked for companies with less or no fringe benefits, using national averages inflates economic damages.
4. Have federal and state income taxes been subtracted from past and future earnings? What factors did you consider in calculating past and future income taxes?
Deductions for income taxes in each year should be based on the plaintiff’s actual situation, including household income, marital status, number of dependents, and itemized deductions. Using an average income tax deduction for an earning range is less accurate. A spouse’s earnings may increase the marginal tax rate on the plaintiff’s earnings. Deductions will decrease as children age and cease being dependent.
5. Did you deduct Social Security and Medicare taxes from future earnings?
Workers pay 7.65% of wages for Social Security and Medicare taxes. This amount should always be subtracted form future earnings calculations. Failing to do so inflates future earnings.
RPC provides a full array of economic damages services in personal injury cases for both plaintiff and defense attorneys. Our team includes economists, life care planners, a vocational expert, physicians and neuropsychologists. Our experts work together to create cohesive reports, while avoiding duplication of work and providing cost savings to attorneys.
RPC’s team includes Dr. Brian Piper and Dr. Ron Luke, both of whom have been accepted as expert witnesses in personal injury cases.