What does "loss of earning capacity" refer to?

Loss of earning capacity refers to the potential income an individual is unable to earn as a result of a work-related injury or illness. This concept is particularly important in the context of workers' compensation, as it assesses the extent to which an employee's ability to earn income has been affected by their condition. The focus is on the difference between what the employee could have earned had the injury not occurred and what they are capable of earning after the injury.

This definition captures the essence of the financial impact that work-related injuries or illnesses can have on a person's career trajectory, job opportunities, and overall income potential. This distinction is crucial for determining compensation benefits, as it allows for a clearer understanding of the economic losses faced by the employee due to their reduced earning ability.