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Ask HN: Startup stopped paying my salary

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Re: Ask HN: Startup stopped paying my salary

#51

Post by bugsy »

I would advise you follow the wage claim route with the state since you were an employee. If you were a contractor you'd have to sue in small claims court, you'd undoubtedly win a judgement, and then it would be up to you to enforce the judgement by getting a lien on the company's property or such. With the wage claim you'll still probably not get anything, but it might prevent him from running more scams in the future unless he settles up.

I strongly advise you emotionally disconnect from them. It sounds like you like them and don't want to cause troubles for them, and they like it that way. You may find they are not the nice sweet people you thought they were as soon as you require them to pay you the money that they owe you. They are not doing you a favor paying your wages, that is money you earned. They are not your friends, they are thieves who stole your hard earned money from you. Don't allow the fact that they did this while smiling and patting you on the back to distract you from your goal - to get paid what you are rightfully and legally owed.

Re: Ask HN: Startup stopped paying my salary

#53

Post by mkramlich »

mgkimsal wrote: post #13

I was in their shoes once, and it was a horrible experience. I had paychecks bouncing at the end, some tempers flaring, and overall was about as miserable as could be. I'd suggested that people start looking for other jobs - there was no turnaround in sight. This was just a group of 5 of us - not some huge office, so we were closer (physically, if nothing else) than some other larger orgs that have gone through this.…

I've been approached a few times by a company whose business model looked suspiciously like what you described. In fact, eerily similar. I don't want to name them here publicly because I'm not 100% sure that's what they were doing. But I felt strongly enough about it I walked away from them and ignore all email from them since.

Re: Ask HN: Startup stopped paying my salary

#54

Post by nimblegorilla »

0x5a177 wrote: post #12
staunch wrote: post #6

Two issues from my point of view: 1) You're owed the money legally. No question about it. You can probably even get it. California takes a very hard line on unpaid wages. 2) In the grand scheme of the situation do you feel good about fighting them over the unpaid wages? #1 is easy. You file a claim. You have a decent chance of getting your money. #2 is harder and it's impossible to know from the outside. I think it's…

I don't feel good about fighting them over the money. This may sound weird, but I do want the company to succeed. However, I might feel worse if they flat out got away with it. There are several of us employees who are owed back salary and it was very unprofessional and un-courteous for them to keep us on the hook the way they did. I think it would be a weak move to avoid it completely, but maybe not weak to at least…

Do you think you were paid a "fair" salary to begin with? If you worked somewhere for 40 months and didn't get paid for 2 of those months then it's like you were paid 5% less than the agreed salary (I realize this isn't totally accurate in that the last 2 months you were probably paid more than the first 2 months). If they took you out for nice lunches and sent you to conferences then maybe they also overpaid you by 5% compared to other jobs?

I've lost out on a month's earnings before and it really sucks, but if you had a good relationship with them and learned a lot then maybe it isn't so bad.

Definitely keep up the pressure and hopefully you'll get some of the money you are owed.

Re: Ask HN: Startup stopped paying my salary

#55

Post by 0x5a177 »

philwelch wrote: post #47
tptacek wrote: post #4

You're not going to get the money back. 'grellas may hop on and set me straight on that, but what I expect will happen in the best case is that by pursuing a wage claim you start the machinery that finally puts your employer into bankruptcy, whereupon you become a creditor, lining up with all the rest of the creditors who aren't going to get paid either. Don't let my belief here imply that you shouldn't do anything;…

"whereupon you become a creditor, lining up with all the rest of the creditors who aren't going to get paid either" I was under the impression that employees owed wages are paid before other creditors, which means OP would have a better chance of getting something .

I've heard that through the grapevine, and other commenters have concurred, but I've never confirmed it.

Update: according to 11 USC Section 507, wages fall in 3rd place. I am not a lawyer so I may be reading this all wrong, but it goes "administrative expenses", "unsecured claims", then wages up to $4000 (about half of what I'm owed) and earned within 90 days of the bankruptcy filing. It's been about a year since I quit the company, and the wage claim through the labor board has a 3-year statute of limitations. I wonder what would happen if I filed a wage claim on a bankrupt company...

(http://www.lawdog.com/bkrcy/bkmd3.htm#726.)

Re: Ask HN: Startup stopped paying my salary

#56

Post by 0x5a177 »

benatkin wrote: post #50
j_baker wrote: post #41

"It was my first job as a developer, and when my boss left I got promoted to "CTO" and got to hire my own small team. This is one of the main reasons I haven't really "gone after them". I don't really want to screw them over, I just want my money." Did you deserve the job of CTO? If so, then you also deserved the paycheck. If not, then be happy with the fact that you got a cushy job that will look good on your resume…

Another thing about being CTO: are any other employees that have been shafted mad at him ? In most companies that have the title, CTO is a leadership position.

Yes, the other employees that have beef are taking it up with the CEO. I wasn't a real "CTO" as you one might think. But as far as that small company was concerned, I was responsible technology direction, although I didn't have my own budget for hiring.

Re: Ask HN: Startup stopped paying my salary

#57

Post by 0x5a177 »

amirmc wrote: post #38
trizk wrote: post #23

I am going to have to go against the grain on this one. Yes you are owed money that is rightfully yours. But you wanted to be part of a startup with all the associated glory and rewards. That means you also assumed some risk and realized you might have to be flexible based on the circumstances handed to the startup. Remember, Amazon almost went under. The founders are not jerks. They spent what they had on you and tr…

"But you wanted to be part of a startup with all the associated glory and rewards. That means you also assumed some risk..." I disagree with that. This person is an employee not a founder. Therefore the risk they assume should be different. At worst, it should be that of losing their job at short notice. The flexibility you also refer to should not extend to working for long periods with no idea when you'll get paid.…

You could say that I assumed the general risk of dealing with people, but amirmc is correct that I did not assume any formal business risk. I.e., I did not receive stock options or any other compensation that is normally given to risk-bearing stakeholders.

Re: Ask HN: Startup stopped paying my salary

#58

Post by 0x5a177 »

j_baker wrote: post #42
MediaSquirrel wrote: post #37

Well, they owe you SOMETHING, either cash or if they don't have it, equity. Demand what is yours. First off, you have a right to know the state of the company's finances. If they say they don't have the money, tell them to prove it and show you their bank account balance. Second, you can be aggressive without getting personal, as long as everyone stays honest. If they're lying to you, then they're douchebags and it i…

"Well, they owe you SOMETHING, either cash or if they don't have it, equity." Who would want equity in a failing company? If I were the OP and they offered me equity, I'd be insulted.

You are correct, sir. Equity in this company would be worthless to me, just a token of their appreciation.

Re: Ask HN: Startup stopped paying my salary

#59

Post by bobf »

benatkin wrote: post #49
lionhearted wrote: post #16

Earlier quoted context omitted.

> You're not going to get the money back. Indeed, that's my read too, but he shouldn't just shrug his shoulders and give up. An option: Call them up, tell them you're short on cash and really need the money, and offer to take 1/4th of the salary you're owed if they can pay you shortly and it'd be a huge favor to you and you'd appreciate it. This removes the small chance of getting the full amount, but it gives the ve…

Why would they give him 1/4th the salary? Could he sign away his right to demand the full salary, or would any such agreement be unenforceable if he decided to come after them later? I'd support the legal system allowing him to sign an agreement accepting a lower amount and making that final, but I wonder if it works like the minimum wage, where workers can't sign away their right to be paid at least the minimum wage…

(IANAL, but my business law professor was...) Contract law says that if you say you'll take X paid "shortly" instead of the full amount Y in a situation like the OP describes, it does not prohibit you from collecting the remaining amount later. Even if you sign a contract that agrees to settle the debt, that contract isn't valid because the employer is not providing any consideration in that instance.

Having said that, I was in a similar situation and basically just gave up ever seeing the money for the same reasons others have already given.

Re: Ask HN: Startup stopped paying my salary

#60

Post by mgkimsal »

mkramlich wrote: post #53
mgkimsal wrote: post #13

I was in their shoes once, and it was a horrible experience. I had paychecks bouncing at the end, some tempers flaring, and overall was about as miserable as could be. I'd suggested that people start looking for other jobs - there was no turnaround in sight. This was just a group of 5 of us - not some huge office, so we were closer (physically, if nothing else) than some other larger orgs that have gone through this.…

I've been approached a few times by a company whose business model looked suspiciously like what you described. In fact, eerily similar. I don't want to name them here publicly because I'm not 100% sure that's what they were doing. But I felt strongly enough about it I walked away from them and ignore all email from them since.

fwiw, i wasn't approached - i'd simply answered an ad on craigslist.
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