My payroll (paycheck) was reversed for days I already worked, is that legal?

[mosullivan]

I am an independent contractor in the state of FL who is paid a monthly salary of 80k per year and 3333.33 every 2 weeks.

I worked for an ERISA Consulting firm for 2 years as full time employee. On 12/14, I gave my notice that I was leaving the company. I worked through the payroll period (11/30 - 12/11) which was deposited to my account on 12/15/09. When I handed them my notice I offered to stay on to help out during any transition (to help any new employee) On the day I left, 12/14, I was told that they would contact me if they needed me. This morning (12/21) when I woke up and checked my bank account, I noticed that the funds for my previous payroll ($3333.33) were reversed and taken back out of my account. This was for days that I already worked (11/30/09 -12/11/09) before giving my notice. When I called and asked my employer why he did this, he told me it was "standard protocol" to withhold the last check, in order to do a final compliance check and that he may have me sign something to confirm I wasn't doing anything out of compliance. I am very suspect because #1 There are no compliance matters or issues and I don't think they are allowed to withhold my already paid compensation for some "compliance matter"

My belief is that he wants to have me sign a non-solicitation agreement to not contact his clients before paying my funds back. I don't think I should have to sign anything.

They are supposed to contact me within the next 1-2 days with this form to sign and I'd like to know the best way to handle. The couple people I asked about this matter told me that my prior employer's actions border on fraud and that I should demand payment and not have to sign anything.

I would like to know my rights and how I should proceed if he does not pay me back the money that he took back out of my account. Also, how long is the process (in general) and does it cost a lot to file a small claims lawsuit? Should I contact the DOL?

Thank you very much for reading this and I appreciate any insight on the matter.

 

[truthbtold]

I think that you may not have had this problem if you had given proper notice. With the standard "two-weeks notice", I think everything would have been worked out prior to your final paycheck. Since you didn't give proper notice, this became your final paycheck. It may actually BE standard protocol.

It's too soon to panic and to consider options. They may pay you very soon. As far as the document to sign, you have the right to review it or to have an attorney review it before you sign. So, that's the next step. Receive the document, and if you want to discuss the contents before signing, feel free to get advice here.

 

[mosullivan]

Hi Truthbtold,

Thank you for your reply. Regarding my giving notice. I did give a notice. In my letter of resignation, I wrote the following:

"Thank you for the opportunities you have provided me during my time with the company. If I can be of any assistance during this transition, please let me know and I will make myself available."

In the securities or brokerage industry, when you give notice typically "that's it" When I handed one of the partners that notice and told them that I was more than happy to assist in any way that too said that they would contact me if there was anything else that they needed. What is ironic is that 1 week after my giving notice, I received no call from them asking for assistance. Then, when I noticed my check was reversed on Monday, one of the partners said that I didn't give them enough time to prepare for my departure. Again, this is fishy given the fact that I offered and received no call from them. They also took my key the same day I left.

I agree that it's too early to panic. However, I also believe that what they did was wrong legally and what my real question is:

-Can they legally require me to sign some document like a non-solicitation or non-compete or any compliance statement before releasing my pay for hours worked? Any compliance matter, at least it seems, should be a completely separate matter, correct?

Lastly, there was no warning to me that they were going to reverse the last check and again they didn't acknowledge or request my assistance for help to train anyone else.

I'd appreciate thoughts on this and what my best course is if they don't pay me and/or require me to sign any form to receive that last check. (eg. filing a complaint with the department of labor or a lawsuit)

Thanks again, Mike

 

[Patricia_Young]

See an attorney who can review your contract/agreement in full and determine what, if any, recourse you may have. As an independent contractor, wage payment laws (even if Florida had any) don't apply to you.

You did meet the criteria to be treated as an IC, right?

 

[mosullivan]

Well, I just got off the phone with the DOL about an hour ago. They were very helpful. They told me that I was in fact entitled to the wages for the hours I worked and they can't reverse my funds. They also asked why I was listed as an Independent Contractor when I was really working for them like an employee. This is an issue with the DOL b'c she told me that the way they had me set up (salaried, 40 hour work week, using their company equipment) the last 2 years I was really an employee and not "technically" an Independent Contractor. I think they had me as an Independent Contractor to avoid paying my share of Social Security and Medicare taxes, for which I was currently liable for as an Independent Contractor.

The representative from the DOL is going to be calling them personally today and inquiring about my situation. She's supposed to be getting back to me today or tomorrow. I didn't want to "file a complaint" because I just wanted to give notice and leave peacefully. But remember, they (former employer) went into my account (1 week after I gave notice) and reversed a deposit for hours I had already worked those days. When I woke up yesterday, I had over $3k taken back out of my account with no phone call or explanation from my prior employer.

It seems they may have caused an even bigger problem for themselves because now the DOL is looking into why they had me as an Independent Contractor. Note: This place even 1099's their interns. Strange...

I am glad I am no longer there...any thoughts?

Thanks for reading...