Can a company refuse to pay an independent contractor for a ‘breach of contract’ even after the work was already completed?

UPDATED: Sep 30, 2022

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Can a company refuse to pay an independent contractor for a ‘breach of contract’ even after the work was already completed?

Driver for a company called NDS. I drove my own vehicle and delivered parts for NAPA. After several months of work, the company contacted me saying that I was never added to their insurance. Had I been in an accident in that time it would have been 100 on me. I left the company and as a result they told me that my contract was breached. They told me that any money that was owed to me would be forfeited. I used my own money to pay for gas and delivered the parts for 2 weeks. The company profited on my work and decided not to pay. Can they do that? Do I have a case in small claims?

Asked on March 7, 2016 under Employment Labor Law, Wisconsin


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

Yes, you should have a case: your breach of contract would obviously entitle them to no longer employ you, and if your breach cost them money (e.g. caused them to themselves breach a contract to a customer), they can likely offset that against what they owe you; however, they do need to pay you for all work you actually completed, under both contractual and "unjust enrichment" theories. (Unjust enrichment: they cannot profit from your work without paying for it.) If you were to sue them, you would have a reasonably good chance of success, unless there is some provision in a written contract between you and them stating that in the event of a breach, you forfeit your pay (if there is such a written provision or term, it is it enforceable).

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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