My employer isn't paying me, what do I do?

January 23, 2007 11:17 PM

My employer isn't making payroll regularly. What's my best recovery strategy? My bank account needs

I've been working for a small software company since 1 November of last year (W2, full time, remote office). I knew when I took the job that they had problems, but I managed to delude myself into ignoring the scope and extent of those problems for various reasons.

Now I find myself in the following situation: I've actually received checks for two out of the past five (soon to be six) pay periods, work from home on my own equipment, and have not been reimbursed for ~$400 in business travel expenses. The financial situation isn't dire thanks to my wife's income and plenty of savings, but it's not great either. Assuming that I haven't quit yet but will no later than August (to go back to grad school, otherwise I'd already be gone), what's my best strategy for getting what they owe me in a reasonable amount of time? They're in Texas, I'm in Colorado. I'm not sure if it's Texas or Colorado law that applies to my situation.

It's likely that the company will remain in business after I leave, at least for a few months or a year, as apparently this has been normal practice for them for years. As such there's the chance that I could recover the money in a friendly way, but according to my reading of the Texas Payday law, the statute of limitations on official complaints to the Workforce Commission is 180 days. I think Colorado would give me either two or three years to file a complaint, depending on the reading of the law. Suggestions? (Other than "talk to a lawyer" - I'll do that soon enough, but I'm doing what research I can and exploring options beforehand to help with the lawyer shopping). Recommendations for Texas or Colorado employment lawyers would also be welcome...

posted by hackwolf to work & money (12 comments total)

Once you begin legal action to recover, your chance of remaining employed with the company fall dramatically. However, you're basically in the position of a man at a bad restaurant, complaining of both the lousy food, and small portions.

If you're a W-2 employee in Colorado of a Texas corporation, your Colorado Labor Department might try to help, but what they might be able to recover for you from a Texas corporation, that should have, but might not have filed to do business in Colorado as a foriegn corporation (definition #2 of link), might be pretty limited.

"The Division of Labor will assist in the recovery of earned compensation. However, the Division of Labor does not have the legal authority to order the payment of wages. Click here for important information on filing complaints and the Division’s authority. "

Colorado isn't much of a worker's paradise. Quit immediately, and move on. Cynical as it may seem, companies hire workers in other states at least partly because they are easier to screw in such scenarios, and because it can prevent them from getting big enough in their home states to fall under certian provisions of their home state labor laws, that are based on numbers of employees.
posted by paulsc at 12:18 AM on January 24, 2007

What have they said when you've spoken to them about this? What's their excuse? What's their plan? You have confronted them about this, haven't you?

They have stolen from you. It is theft. Paulsc's restaurant example isn't fitting; you have provided them with a service, and they haven't paid their bill. The advice to quit is probably pertinent, though. If they're fucking you over this much, what have you got to lose; it ain't going to get better. Don't give up on this. They've stolen a large amount of money from you.
posted by Jimbob at 4:09 AM on January 24, 2007

I haven't quit yet but will no later than August

No, quit today. You are never going to get paid for the work you are doing right now, let alone the next seven months. I come from a big blue collar family in a declining industrial part of the country. We have all worked lots of terrible jobs for shaky companies that eventually go under. The folk wisdom in our family is that once a company fails to make payroll, you bail right away.
posted by LarryC at 6:36 AM on January 24, 2007

Obviously you need to confront them about this, ideally the day before some piece of work absolutely, positively must be in hand.

Small businesses routinely defer payment to Peter to pay Paul. Some bills can be deferred and some can't. I imagine their ISP and phone bill gets paid, you just need to get out of the "pay when we can" category and into "pay when they ask" category.

I wouldn't pick a fight with them (since your legal recourse is complex), but I wouldn't cut them any slack.

Spoken as someone who runs a small software company: Deferring payment to vendors is one thing, but only a jerk does that to actual employees.

Oh, and if they don't pay right away, quit the day before that critical work must be in. If they call you back, get the whole sum in a cashier's check, hand over the critical work, and never look back.
posted by mrbugsentry at 6:45 AM on January 24, 2007

Talk to them. Tell them you need the money immediately. Get them current. Quit. Don't look back. Don't feel bad. They know they've stiffed you. They will continue to stiff you as long as you let them.
posted by onhazier at 8:19 AM on January 24, 2007

Hold the software hostage until they pay the back wages in a cashier's check, money order, or cash.

Boobytrap server-side code; refuse to send local code. You are in the position of power in this situation.
posted by Netzapper at 8:21 AM on January 24, 2007 [1 favorite]

Would you stay at this job at 1/3 pay? That is exactly what you're doing.

Very likely to become less than 1/3. People who are abusive like this tend to push until it breaks.

Quit today, this minute. And consult a lawyer. Though I doubt if you'll ever see the money. getting judgments across state lines isn't easy and may not be worth what the lawyer will cost you. However you might be able to scare them into paying by having the lawyer write a threatening letter and sending it registered post.

Hold delivery of your work, but do not booby trap it or put in back doors. That is bad mojo and can be criminally actionable.
posted by Ookseer at 9:08 AM on January 24, 2007

Agree with people above - they need your work. The next time they need it urgently, tell them they have to pay you what they owe you, now if not sooner. Your comfortable financial situation is irrelevant, and they don't need to know about it. They owe you for work done.
posted by altolinguistic at 9:39 AM on January 24, 2007

Boobytrap server-side code; refuse to send local code. You are in the position of power in this situation.

Committing a crime which allows your employer to sic the might of the criminal justice system on you would be the best way to lose your position of power, and really stupid.
posted by grouse at 10:42 AM on January 24, 2007

altolinguistic: tell them they have to pay you what they owe you, now if not sooner.

Nthing the "talk to a lawyer, but in the mean time wait till just before a big project is due and withhold the work you did, without sabotaging it, to get all back pay owed- then quit". But I just had to respond to altolinguistic's comment; if they had the kind of mastery over time and space to pay him sooner than now, I don't suppose they'd be troubled by little things like making payroll to begin with.

I'm also kind of surprised your wife let you continue this through 6 pay periods, if I'm reading correctly.
posted by hincandenza at 11:46 AM on January 24, 2007

You're going to keep working for them for free until August? Why would you do that? If you want to do volunteer work there are probably lots of local organizations...
posted by yohko at 12:59 PM on January 24, 2007

My suggestion is to get out of this situation now. When a company stops making payroll, that's a huge red flag that they'll go under at any time now.

If I were you, I'd tender a resignation as soon as possible.

I know it's a concern that the owners might bad-mouth you to future employers, but in today's climate of hypersenstivity to litigation, most companies will only confirm your employment with that company and the dates thereof.

If you find out down the line that your employers are telling lies about you and your work to potential employers, you might have a case for libel or slander.

Simply put, get out now, and see if you can find something else to do until grad school. Life is too short to do work that you're not getting paid for.
posted by reenum at 10:10 AM on January 25, 2007