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How to sue your employer and win

unposto.wordpress.com

58 pointstallyh0022 comments

Just wanted to give a bit of feedback on the attorney situation (I am not a lawyer - my wife is an employment and labor attorney).

Lawyers working on a contingency basis on what is likely a fairly small matter are going to put as little time into it as they can. You'd be surprised (or maybe not) how little there is in a case like this, a few letters and memos that they likely bust out in their free time. Unless your damages are significant expect a few hiccups in the road.

Also your state bar is usually a good resource to start when looking for attorneys (here's CA's). Also with the glut of attorneys out there (my wife, sister, cousin and the best man at my wedding are all attorneys) are usually great places to start when looking for recommendations. For example I had a friend with a small business who was dealing with a lawsuit who went to my wife's firm for help (through my wife) they were too expensive but were more then willing to recommend a smaller firm - and the smaller firm was more then happy to help (and kicked ass).

http://www.calbar.ca.gov/state/calbar/calbar_generic.jsp?cid...

The opportunity cost of pursuing this is huge. Cut your losses at 100 hours and spend your time looking for new clients.

Spend $5 and buy a used copy of "The Check is Not In the Mail" http://www.amazon.com/Check-Not-Mail-Without-Customers/dp/09... it will give you a number of suggestions for how to structure an engagement to avoid some of the problems you faced here.

The real warning sign on this was the inability of the company to set a date for a partial payment, telling you to "be patient" instead.

> The opportunity cost of pursuing this is huge. Cut your losses at 100 hours and spend your time looking for new clients.

The strategy of cutting losses and not retaliating might seem rational and it is - in the same sense as overgrazing in the tragedy of the commons is. If everybody chooses this strategy, then it becomes rational to screw anyone for 99 hours pay (and switch to another sucker.)

He can go public and warn folks if after three written interactions they acknowledge that he delivered the work but refuse to pay or give a timeline for payment. Has the same effect as spending a lot more time on a client that will never be a reference.

Also, read the book, there are a number of things you can do to manage your "credit policy." Essentially you are loaning the customer N hours of work: if you look at it that way you may engage differently.

Finally, life is short and getting screwed out of 100 billable hours is not the worst thing that will happen to you even in a two or three year period.

Thanks, I will check out that book.

I definitely wasted a lot of time and emotion on this. But it felt quite good when they actually paid :)

If I did end up in a similar situation again, regardless of what precautions I took, I think I could at least attempt to pull the same thing off with very little time/effort, having the knowledge of the process that I do now.

Btw, once I realized they weren't paying anytime soon, I of course did go ahead and find another gig (which actually paid).

I feel sorry for OP. It really sucks to be waiting on the receiving end of an invoice with no hope in sight of getting your hard-earned money. It really sucks to be in that position.

I don't know the specifics of this case, but I have encountered some of the same red flags that the author found. I worked as a remote contractor for a company, was interviewed over Skype by the CTO, had most of my interaction with the technical manager over Skype. I worked mostly by myself outside the scope of the other developers. Best of all, the codebase was mostly written by offshored developers.

This all sounds like a recipe for disaster, but instead it was an amazing experience. The tech manager was incredibly competent and great at managing umpteen developers in 4 countries. The codebase was reasonable to work with and I was able to move really quickly to get things done.

Maybe I got lucky, or maybe these red flags don't have any bearing. I only have anecdotes, so I don't know the answer.

I agree, the 'red flags' I mentioned probably have very little predictive value.

While many people hiring contractors won't go for this- it's a good cause to ask for 50% upfront and for the remainder payment to be held in escrow. It doesn't hurt to ask at least. Of course it is hard to tell what your total number of billed hours will be, but always ask for 50% deposit of whatever your estimate of the job is.

Note that if you're an employee instead of a contractor like in this case, your state very possibly has a unit that hounds companies that don't pay your final paycheck(s).

I and a number of coworkers had to do this in Virginia when a couple of investors (worth $600 million between them) revealed they were devils rather than angels. The process was pain free compared to the "sue them" route tallyho00 had to follow (the state employee(s) we dealt with were experienced and had heard it all before), and in theory it was backed up by their (in)action being an misdemeanor.

Kudos to tallh00 for cutting them off promptly and pursuing them, we need a more feedback like that in the system.

The OP seems to be confused about his relationship with the company he sued. He uses the phrase: "if you want to sue your company" and "my company" to refer to his customer. They were not his employer, it was in no way his company - they were a customer who hired him in bad faith when they had no money to pay him.

http://unposto.wordpress.com/2010/01/08/how-to-sue-your-empl...

I'm really hoping that my own experience isn't going to be this bad. I'm owed close to $20k from a client who's so far failed to pay, and I'm working on taking them to arbitration (as per the contract) while looking for other work. Luckily, I brought it up to my startup's lawyer and he offered to take it on, so at least that part will be simple. I'm really hoping that arbitration will be as quick as I've been told it is, but as OP found out, nothing is ever that easy.

I feel for anyone in a similar position; it always sucks to be out a decent chunk of money, waiting for some third party to decide you really do deserve it. I don't know about anyone else, but I'm getting my money in escrow from now on...

So far, I've had a policy of never being owed more than I could collect in small claims court.

Two reasons: If it doesn't happen, I have two options a) drop it, it's only $3000 here, or b) Take them to court w/o a lawyer, and very small court costs.

Is this moderately viable?

If you charge a reasonable rate, not really, unless you always ask for payment before you complete work. Let's say you charge 100$/hr. That means you are going to demand payment before you complete a full week of work. Say you charge $50/hr. Now you are demanding payment (in hand/check cashed) before two full weeks of work. Good luck finding a company/client who will pay you on that schedule.

Yeah, most of my consulting is really low-quantity in the hours arena, as it's not my main income stream. Anything more than a week f/t I'm really careful with.

I meant more viable from a legal standpoint I think.

What's odd to me is that the OP sued them, won, is offended by what they did... But won't reveal any of the company names, or executive names.

That seems like it would be the most effective way to keep them from doing this again.

OP here...

Trust me, I thought about doing this. I even thought of this as a strategy to get paid before I ended up suing them. But considering this wasn't a huge amount of money, I figured the potential damage to my reputation by making the situation a public affair could end up costing me a lot more in the future.

> I figured the potential damage to my reputation by making the situation a public affair could end up costing me a lot more in the future.

Hmmm... What exactly would the damage to your reputation be? Hey, let's not hire this guy, he might sue if we screw him!

how about, "hrm... here are two almost equivalent candidates, oh wait that one sued his last company and ruined their rep"

or... what if the HR department of some big company doesn't hire people who have sued their employers?

I'm just making things up but I have a feeling there is some potential situation where it would cost me.

Also what do I gain from it? Vengeance is one, not really a good reason. Helping out the probably not so huge number of other people who might get conned by them in the future is the other.

That reason is pretty decent, but weighed against the personal cost to me, not so much. Also you need to factor in if these future employees would even find my warning. I did a little SEO testing with this already and it wouldn't be that easy to create something easily discoverable.

While I'm loath to quote xkcd, http://xkcd.com/137/

For people like text: Essentially not doing something because someone, somewhere, who might at some point give you money might be offended is a bad idea.

You need to weigh both sides, if there was something great on the other side, then I would agree with you. In this case, I don't gain all that much for going public with it.

If the HR department of some company doesn't hire people who sue employers for an extreme example of non-payment, would you really want to work for such a company? Wouldn't this only hurt your chances with companies that have serious problems paying their contractors?

Not only did you explain your side of the story very reasonably, you did... win the suit. It's not some he said/she said deal, a court of law ruled you had been wronged.

If you want a gain: companies that don't pay their employees will self-select themselves out of trying to get free work from you.

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