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Employer won't pay...
Chesterton
Registered User regular
Registered User regular
So... I work for a small business, and we have yet to release any product, so we're running on investments for the past year or two. Last pay period, my boss simply didn't pay me. He acted fairly unprofessionally, and didn't tell me that he wasn't depositing the paycheck until I came back from vacation two weeks later.
He says the company is out of investments and that he made the hard choice of simply postponing my pay until he can round up some more money, which he hopes to do within a month. Meanwhile, I won't be paid. However, he promised to pay me and told me he expects me to keep working.
He's always been fair before, but this strikes me as remarkably screwy. I am apprehensive about working on the mere promise of pay for at least another month before seeing any of it.
Now, of course I am not going to stay with the company long-term - I was already planning on leaving at the end of the summer. Some people I know are telling me to get the hell out, and quit immediately. But...I really need the money I'd earn in the last half of the summer, assuming I ever get paid. And there's no way I can get another job just for the next month and a half.
I guess in the end it comes down to whether I trust him, on a personal level, that I'm going to get paid. I am inclined to do so. But some others are telling me that there are larger things at stake, and that it is foolish in principle to work without pay.
He says the company is out of investments and that he made the hard choice of simply postponing my pay until he can round up some more money, which he hopes to do within a month. Meanwhile, I won't be paid. However, he promised to pay me and told me he expects me to keep working.
He's always been fair before, but this strikes me as remarkably screwy. I am apprehensive about working on the mere promise of pay for at least another month before seeing any of it.
Now, of course I am not going to stay with the company long-term - I was already planning on leaving at the end of the summer. Some people I know are telling me to get the hell out, and quit immediately. But...I really need the money I'd earn in the last half of the summer, assuming I ever get paid. And there's no way I can get another job just for the next month and a half.
I guess in the end it comes down to whether I trust him, on a personal level, that I'm going to get paid. I am inclined to do so. But some others are telling me that there are larger things at stake, and that it is foolish in principle to work without pay.
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If it's one of the first two, you can always sue him for back pay. If it's the latter (and it sounds like it is, given that he's talking about investors), I'd get the hell out if you don't think he's going to pay you.
Yeah, you need the money, but if you're not going to get paid anyway, it's the difference between having the rest of the summer to goof off or whatever and not get paid, or wasting it working at a job where you won't get paid.
Though, you should give him a chance to pay you before you quit.
As far as this being an issue of you trusting him on a personal level.. unless you two were previously friends, "personal levels" should never interfere with work. Now if it was just a misunderstanding and the company set up an exact date at which time they were going to pay you for your work, that would be one thing. But this sounds much more shady. If he's just saying that they need to allocate funds, then he could easily just be like "JK! It's been a month and we still have no cash!" At which point you would be S.O.L. Sounds like you need more good information and committment from him about it.
I have a friend just talk to me last night about his job pulling the same thing. They're a startup and they came in to his office yesterday and said "So, we don't have enough money to pay you until 3 weeks from now...by the way have you closed any deals?" He's planning on getting out right now because this is the third or fourth time they've done this to him.
I had a different friend at my martial arts school get SCREWED by a company. It was a computer software company and he was a programmer. Basically they told him that they couldn't pay him for four months, but they'd pay him for six months worth of work at the end of that period. Well, the day came around, they gave everyone a paycheck that was about 1/4 of what it should have been and said "Cash it tomorrow morning." Well, he didn't hear that part so he went and cashed it that night. The next morning everyone else's check bounced. They were apparently hoping that everyone would go in to their banks at about the same time and everyone's check would bounce. That way they'd still have a little money to work with and they wouldn't have to pay their employees.
Moral of the story is that if you are working you should be receiving pay. If you are not then you need to get the money that is owed to you and get out.
LLC...but can't I still sue them for the money, as long as the company doesn't go under completely? I have a contract, and all...
The problem is, I won't even know if he's going to be able to make good on his promise for another month.
The personal thing comes in because I have worked with him for the past 3 years, we know eachother fairly well, and for me to just quit would be the equivalent of telling him that I think he's lying about his intent to pay me. It's not as if someone high in the company chain of command is screwing with me... He's the owner and CEO and I was his first employee. One line of sound reasoning seems to be that if I believe him when he says he's going to pay me, I should stay, otherwise, leave. Yet another line of equally sound reasoning says that one should never work without pay.... and I'm not sure which to follow.
No, what I mean is you tell him "I don't really feel comfortable working for no pay, so unless you can finagle a paycheck for me, I'm afraid I'm going to have to quit." If he comes up with the paycheck, no reason to quit.
Yeah, that's a rough position to be in. Personally, having heard stories like this one before, on both ends of the spectrum (people both regretting and not regretting working without pay for awhile), I think I can say I've heard three times as many stories about people regretting it as I have about people not regretting it. Personally, I wouldn't trust him, but then again, I don't trust anyone. Not being able to pay employees is usually a sign that a business is in trouble, and if a business is in trouble and asking you to work for no pay, odds are by the time it goes down, there isn't going to be any money there to pay you from.
Businesses aren't personal relationships, they are business. They don't pay you out of the goodness of their heart and you aren't working for them out of charity. You're both doing it because it earns you more money than not doing so would. When that stops being the case for one side or the other, they end it.
If a company doesn't have the money to pay its employees now it's pretty unlikely that in 2-3 months it's going to have the money to pay the employees for their current work plus 1-2 months of back work. I say get the hell out.
I worked for a company in a similar position as you, they ran out of vestment. I talked to the guys (it was co owned) and asked him for a small part of ownership in exchange for continued worked. The company turned around and I made a decent wad of money from it. The downside of course would of been if they didn't turn it around, then I would of been out of all that labor. It's risk, but that is one option you can put out there on the table if you're willing to take that.
If not, then cut and run; go get yourself a sessional job for rest of the summer.
Oh wow, such a hard choice. Doesn't anyone else find this kinda weird that hes basically saying "oh yes, i made the hard decision to keep my money instead of paying you." Is he doing this to anyone one else or to you in the past? What does he expect you to do till he gets around to paying you, live in the woods and hunt small animals for food?
Get out now and if you want to be nice about it, give him a little time to see if he comes up with the money before you sue him for back pay.
of course this is invalidated if you feel the product that will eventually be available is going to be a big moneyspinner and you could be onto something good by staying and showing company loyalty etc.
Well, if what he told me was true, it was either me or our office building rent. And he claimed to have taken no money home himself for the past 3 months.
People do work for no pay when they feel that the company has a chance of paying them, and that the company is worth the sacrifice. It's not too uncommon for this to happen to start-up businesses. The employees believe in the company, so will take the gamble that the company is just on the verge of expanding and it is worth it.
If this company isn't something you believe in, look for another job while employed there. It's a shady practice and is not somewhere you should be. Don't just quit, or then you won't have that pay at all.
unless you signed some sort of contract saying there is no guarantee of pay, then i'm pretty sure withholding compensation is illegal in most states. check your state's labor laws.
if he "expects" you to keep working, then you should tell him you "expect" a paycheck. confront him about it or quit now because when they do it once, it'll happen again and again if he sees you're okay with it. his business issues are not your problem, your problem is the money you arent getting for the work you've obviously done.
a very big sign of a badly crippled business is when it begins denying employees pay, or when you start recieving paychecks that bounce.
think about it: if he can't compensate you for one week, how will he be able to for the next, in addition to what he already owes you?
You could be wasting your time if you stay and don't get paid, but sitting on your butt all day will make the same amount of money.
If you get paid before you find another job and things turn around then great! However if they can't pay you now there is ZERO guarantee that they will pay you later. Looking and finding another job will keep the money rolling in for you.
Despite knowing him on a personal level and trusting his integrity, you need to do what is financially best for you, that is after all why you work.
Tell him you do not feel comfortable working without pay. If he doesn't ante up, tell him you're quitting without 2 weeks notice.
Considering that you were going to quit (soonish) either way, this makes the most sense.
Don't do it. Especially if you were going to quit anyway. Just take a month off early and enjoy that time doing whatever you want, or find something else.
Don't throw a month (or more) away because you feel guilty or feel like you owe him something. He owes you, and has not come through. You have a responsibility to yourself to not stay in such a situation.
http://www.nlrb.gov/Workplace_Rights/employees_or_employers_not_covered_by_nlra.aspx
Figure out which one of the organizations covers you. Visit that organization's website and see about filing a claim. Or, if you are an independent contractor then it sounds like he has breached the contract by not paying for work received. In any case it is illegal to hold pay for work performed. In some cases additional pay accrues for every period that the pay is withheld. His whole story sounds like a lot of BS to me, but I don't know the guy. The question you have to ask yourself is, how are you going to feel in a month when he tells you that he couldn't round up any extra funds and that either a) he has to let you go, unpaid, or b) you will have to continue working without pay for another month.
So, you are right, it comes down to how much you trust the guy. And it is also very foolish to work without pay. If you were going to quit anyway, I would do it now. I would also file a claim for back pay at least to establish that you aren't quitting under normal circumstances. You may be able to collect unemployment for the rest of the summer.