How do I get my money owed by company I worked for.

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How do I get my money owed by company I worked for.

Worked for short period at a job. Was laid off and next week business closed. My check was suppose to be mailed out 06/11/09 but have not receievd it. Phone calls went unanswered so went to place of business to ask for check. Owner said he has no money to pay any one but trying to get it and can not give me a time frame. I advised I need my money and I don’t work for free and his response was to take legal actions. I know he has some money because he is currently trying to run a different business.

Asked on June 17, 2009 under Employment Labor Law, Texas

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

It sounds like you know the answer--sue. If the owner of a business refuses to pay for work done, whether by an employee, a freelancer, a vendor or independent contractor, etc., the remedy is to sue him or her. However, just having the legal right to sue doesn't mean you'll be able to collect--if there's no money, there's no collection.

 

The issue is not necessarily whether the owner has money, though--was the business that hired you a corporation ("Inc.") or a limited liability company ("LLC"). If so, the business is a separate legally entity from the owner and he's not generally responsible for its debts, especially to workers, except under certain limited circumstances. (You'd have to prove that no matter what the legal fiction, in fact the business owner treated the business as an extension of his own personal finances.)

You can and should contact your state's labor department--they might be able to exert pressure on the business, though it's doubtful, if the owner has simply closed shop and walked away. As wrong as it is, you may not have any remedies or recourse, since it sounds like it will be hard to find assets to actually sue against--and even if you do, the cost of the lawsuit may eat up anything you win, or even put you into the red (especially if you don't end up winning). I don't know what you earn per hour or week, but if you only worked a week or so as it sounds, it's hard to imagine a lawsuit is cost effective.

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

It sounds like you know the answer--sue. If the owner of a business refuses to pay for work done, whether by an employee, a freelancer, a vendor or independent contractor, etc., the remedy is to sue him or her. However, just having the legal right to sue doesn't mean you'll be able to collect--if there's no money, there's no collection.

The issue is not necessarily whether the owner has money, though--was the business that hired you a corporation ("Inc.") or a limited liability company ("LLC"). If so, the business is a separate legally entity from the owner and he's not generally responsible for its debts, especially to workers, except under certain limited circumstances. (You'd have to prove that no matter what the legal fiction, in fact the business owner treated the business as an extension of his own personal finances.)

You can and should contact your state's labor department--they might be able to exert pressure on the business, though it's doubtful, if the owner has simply closed shop and walked away. As wrong as it is, you may not have any remedies or recourse, since it sounds like it will be hard to find assets to actually sue against--and even if you do, the cost of the lawsuit may eat up anything you win, or even put you into the red (especially if you don't end up winning). I don't know what you earn per hour or week, but if you only worked a week or so as it sounds, it's hard to imagine a lawsuit is cost effective.


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