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Ely
Ely, Counselor at Law
Category: Employment Law
Satisfied Customers: 99978
Experience:  Years of experience in running a medium sized law firm.
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I have an ex employee/subcontractor ( person I used temporarily

Customer Question

I have an ex employee/subcontractor ( person I used temporarily one Summer) who reported me to the labor board. The labor board stated I did not have the ability to name him a sub-contractor and fined me 250.00 for not keeping records of employees even though I disputed he was an employee. The company they named in the complaint is under revenue suspension by the state and I have re-incorporated myself since then. They are sending me certified letters now because I refuse to pay the fine. Furthermore I have told them time and time again they reported the situation under a company that is not operating. The subcontractor was paid on an account with an entirely different name. What should I do? Can I tell them that I am not paying it.
Submitted: 1 year ago.
Category: Employment Law
Expert:  Ely replied 1 year ago.
Hello and welcome to JustAnswer. Please note: (A) This is general information and is not legal advice. No specific course of action is proposed herein, and no attorney-client relationship or privilege is formed by speaking to an expert on this site. By continuing, you confirm that you understand and agree to these terms; and (B) the site allows experts not participate in phone calls and I may or may not be able to participate in this feature. I am sorry to hear about this situation. So, you had company ABC, which is the one that was fined. You then simply opened another company - XYZ - and began the same work just under a different corporation. Is this what happened, essentially? And now, the Board is sending demand letters to XYZ. Correct? This is not an answer, but an information request. I need this information to answer your question. Please reply, so I can answer your question. Thank you in advance.
Customer: replied 1 year ago.
yes
Customer: replied 1 year ago.
Yes that is correct
Expert:  Ely replied 1 year ago.
Thank you. I am afraid you may not like my answer. While there is a presumption of limited liability, this may be pierced. This is called piercing the corporate veil. See HERE. Please read over the factors listed carefully. The Board is likely going to argue that someone in your situation is simply using XYZ as a shell, and that XYZ is really an extension of ABC, and/or you.There are two ways to deal with this. First, this is to appeal the decision of the Board to its final administrative level, and then appeal to the Court via a mandamus writ, asking the Court to decide. Another is to do nothing and if the Board takes action to freeze, order a freeze, etc, this may be appealed the decision of the Board to its final administrative level, and then appealed to the Court via a mandamus writ, asking the Court to decide.The Court will essentially then be deciding whether or not XYZ is the same company under a different name.Please note: If I tell you simply what you wish to hear, this would be unfair to you. I want to be honest with you and sometimes this means providing information that is not optimal. Negative ratings are reserved for experts who are rude or for erroneous information. Please rate me on the quality of my information; do not punish me for my honesty.I hope this helps and clarifies. Gentle Reminder: Use the SEND or REPLY button to keep chatting, or please RATE when finished. You may always ask follow ups at no charge after rating. Kindly rate my answer as one of TOP THREE FACES/STARS and then SUBMIT, as this is how I get credit for my time with you. Rating my answer the bottom two faces/stars or failing to submit the rating does not give me credit and reflects poorly on me, even if my answer is correct. I work very hard to formulate an informative and honest answer for you; please reciprocate my good faith.
Customer: replied 1 year ago.
The court is not involved yet...it is still in the labor board's hands. If the company is under a revenue suspension how can they do anything to a different company operating under a different name? There are no assets or bank accounts under the company in which they filed the complaint.
Customer: replied 1 year ago.
the company is also not operating under the company's name they filed the complaint with. I have also since moved and they do not have a correct address.
Expert:  Ely replied 1 year ago.
The court is not involved yet...it is still in the labor board's hands.My answer stands as is, however. The Board presumes XYZ is the same as ABC, possibly.If the company is under a revenue suspension how can they do anything to a different company operating under a different name?Yes. They can try to order revenue suspension for XYZ, arguing it is the same company. If so, one would have to appeal this decision in Court, arguing that it is not the same company as ABC.There are no assets or bank accounts under the company in which they filed the complaint. the company is also not operating under the company's name they filed the complaint with. I have also since moved and they do not have a correct address. This would be some of the factors one would argue to the Court if it comes to this, to argue that XYZ should not be involved in any issues with ABC. Gentle Reminder: Please, use REPLY or SEND button to keep chatting, or RATE POSITIVELY and SUBMIT your rating when we are finished. You may always ask follow ups at no charge after rating.
Customer: replied 1 year ago.
Right now they are threatening me to get me to pay it and I think I have passed the time allowed to dispute the claim that the sub-contractor is an employee. They stated they would go to the attorney general's office.They asked five questions to assume he was an employee...they based it on the fact I instructed them what to do on the jobs hired to do them. What if I told them I wasn't paying it. They also wanted to know my revenue and I said it didn't have anything to do with this and no I wasn't going to tell them the revenue. If they issued a revenue suspension to this new company. How in the world could they even enforce it?
Customer: replied 1 year ago.
These fines are based on record keeping of an employee. I dispute he is an employee and never kept these records.
Expert:  Ely replied 1 year ago.
"If they issued a revenue suspension to this new company. How in the world could they even enforce it?"The Board has statutory powers to enforce a suspension. If the company does not abide by it, they or the AG at their behest can go to court and get an ORDER stopping the company from acting. If the company disregards ***** ***** the owners may be held in contempt, and/or law enforcement may be used to aid in shutting ongoing company work.Needless to say, they can enforce the order.Gentle Reminder: Please, use REPLY or SEND button to keep chatting, or RATE POSITIVELY and SUBMIT your rating when we are finished. You may always ask follow ups at no charge after rating.
Customer: replied 1 year ago.
In my opinion they are wasting my time and theirs as I have already stated they have filed it with the wrong company twice now. I have also stated to them there are no assets and bank accounts under the name in which they filed the complaint. Do you think they will continue to pursue it? Going back to the question about an employee and record keeping that was not supplied to them as he wasn't an employee in my mind but a sub-contractor. He also told a vehicle last year without my authorization and charged my visa card without my authorization filling up the vehicle with it with gas. Put a dent in the vehicle as well. This is why he filed the complaint because I never paid him the last paycheck
Expert:  Ely replied 1 year ago.
"Do you think they will continue to pursue it?"Honestly - probably yes."Going back to the question about an employee and record keeping that was not supplied to them as he wasn't an employee in my mind but a sub-contractor. He also told a vehicle last year without my authorization and charged my visa card without my authorization filling up the vehicle with it with gas. Put a dent in the vehicle as well. This is why he filed the complaint because I never paid him the last paycheck"I understand that. However, it seems that the Board has already RULED on that. The above is a moot point, as that decision has already been finalized. The proper action at that time would have been to continue the appeal process and possibly a writ of mandamus to the Court. By not doing this, the decision has finalized. It is now arguably too late to reverse it. The conversation becomes only about enforcement.Gentle Reminder: Please, use REPLY or SEND button to keep chatting, or RATE POSITIVELY and SUBMIT your rating when we are finished. You may always ask follow ups at no charge after rating.
Customer: replied 1 year ago.
So what would or could I do now?
Expert:  Ely replied 1 year ago.
Frankly, I may consider simply paying the $250. In the grand scheme of things, it is not that much. If it is the principle, I would consider possibly appealing the matter to the Court via writ of mandamus, but (a) there are timing issues and (b) this may not be practical as doing so may cost thousands up front and no guarantee of a win.Gentle Reminder: Please, use REPLY or SEND button to keep chatting, or RATE POSITIVELY and SUBMIT your rating when we are finished. You may always ask follow ups at no charge after rating.

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