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Marsha411JD
Marsha411JD, Lawyer
Category: Employment Law
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Experience:  Licensed Attorney with 29 yrs. exp in Employment Law
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I joined a privately held company in 2008 with a compensation

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I joined a privately held company in 2008 with a compensation package of base salary and quarterly bonus opportunity based upon achieving various targets such as EBIT along with quarterly reviews by the owner. I received a bonus payment/review after my first quarter however the Owners proceeded to sell the company to our major supplier. I did not receive further bonus or even a performance review after the sale, however I did not raise the issue as I had concerns that this might jeopardize my position. I have continued to work there.

In late 2012 our division was merged with 2 company branches to form a fairly large "Metro" district and I was made Director of Operations ad offered a new compensation package by the corporate appointed VP/GM. At this point I also viewed comp plans being offered to other managers and raised the point of my unpaid bonus money. I was asked to calculate the amount of unpaid money which I submitted to both the VP/GM and former owner.(approximately $ 70K)

The former owner advised me that the Asset Purchase agreement that he signed eliminated existing bonus plans and that I would not have a claim with the corporation. He agreed to pay this himself beginning in January of 2013 but to date I have only received $6K. The VP/GM has agreed to assist in getting this paid by the Corp. but does not know how successful he might be. I have email exchanges with all parties detailing the comp plan and calculations of past due amounts.

My position is that if the Purchase agreement abolished bonus plans, I would have been advised in writing as this was a condition of employ when I was hired.

Assuming all information has been exchanged and the plan and calculations are valid, is my claim valid? Is there any limit on time to submit such a claim? I am contemplating retirement at the end of this year and would like to put closure on and collect monies due.
Based upon the outline above
Hello,

Thank you for the information and your questions. Before I can assist you I will need some additional information. First, I need to know what State you are employed in. Also, when the change in ownership of the company occurred did any of your other benefits, including health insurance, vacation/sick leave accrual change, or was the transition with pay, etc., seemless? Are you saying that the old company still owes you money from before the sale, or are you alleging that the new company also owes you bonus money? When was the last time you were paid this bonus money you are discussing in your question?
Customer: replied 3 years ago.

I am in New York State.


At the transition there was no change in benefits including vacation, health etc. All benefits for all staff remained the same including salary structure.


 


When we merged the three operations we went on the parent companies benefit plan in 2012 but salary structure and existing comp plans remained unchanged until end 2012 when new comp plans officially superseded existing plans. This is specifically noted in my formal job offer of September 2012


There was one quarter of the bonus plan due from the old company which was the 3rd quarter of 2008 and I consider that paid by the money paid to me by the previous owner during 2013 as noted above. The money remaining is from after the purchase in December of 2008 and is the responsibility of the purchasing group and current owners. In December of 2012 the entity formed in the 2008 purchase was officially merged into the parent.. I received 2-$3000 installments from the previous owner in March and May of 2013 from the previous owner.

Hello again Michael and thank you for that information. However, I am still unclear as to what period (the entire range) you are saying that you were not properly paid your bonus. Are you saying from 2008 all the way to 2012? If so, I am still unclear which entity you say owes you the money. I am getting three entities here from your description, is that the case?

I just am trying to get the facts straight so that I can give you information on the effect of the statute of limitations and other laws on your wage issue.
Customer: replied 3 years ago.

There are 3 entities-first is the privately owned firm (IMS) that I joined in March of 2008 as General Manager, second, the new firm (IMSE) formed after the December 2008 Asset Purchase by Neopost USA and dissolved in Dec 2012 when IMSE was merged into the Corporation (NUSA)which purchased the company . The money due from the original privately owned firm (IMS)is considered paid ($ 6000 paid by the former owner between January and May of 2013). The money owed is for the period that IMSE operated 12/08-12/12.


 


After the December 2012 merger, I was named Director of Operations of the merged group and presented with a new Compensation Plan which noted that previous Comp plans are now ended and the new agreement is in effect from that time period..


 


I informed the VP/GM of NUSA's Metro District, which now includes NYC, of the outstanding amount in 2012 when signing my new comp plan. The original owner of IMS had indicated that he would pay all but now appears to be reneging on this promise (he is an Employee of the merged firm) and I want to collect the balance from NUSA. Does this help? He is willing to present this to upper Management but I would like to know whether I still have a valid claim to this money.

Hello again Michael and thank you for that clarification, it helped. As far as the statute of limitations in NYS goes in regards XXXXX XXXXX an oral contracts, your claims for these wages under a contract theory would be valid for 6 years from the date they are due. So, you are still within the SOL.

The bigger issue for you is who the liable party is. A large part of that answer depends on the language of the transfer documents from each employing entity with the other. In other words, if there are statements in the transfer documents that say that they are transfering assets but not liabilities, then you would ultimately have to sue the actual entity that existed at the time your bonus was due. However, if the wage and bonus agreement continued through each ownership phase, then the current employing entity would be on the hook to pay this.

It is positive support of the fact that the NUSA organization would likely be the appropriate entity to sue, if they did not pay you, by what you said in the following line" "merged group and presented with a new Compensation Plan which noted that previous Comp plans are now ended and the new agreement is in effect from that time period." They acknowledge that they were bound by the previous compensation plans until the change.

Please let me know if you have any specific follow up questions. I would be glad to assist you further if I can.
Customer: replied 3 years ago.

Many thanks-I pulled my current employment offer which reads as follows:


 


"this letter replaces all previous agreements you may have had with any Neopost companies including your previous agreements with IMSE Inc ".


 


As IMSE Inc. was wholly owned by Neopost after the purchase in 2008 I would take this as supporting your last paragraph?

You're welcome, and yes, that would be supportive of what I stated about who would be liable for the bonus payment.

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