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Debra, Lawyer
Category: Canada Law
Satisfied Customers: 99959
Experience:  Lawyer
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Two gentleman incorporated a company to manage a resturaunt

Customer Question

Two gentleman incorporated a company to manage a resturaunt using my trade name . in the 51 days they handled all the money from the till and where responsible for paying the staff they brought in a total of 70,000 in revenue . they refuse to tell us where they have spent the money and account for the reason they can not pay the staff. They did say they paid themselves dividends of about 10,000 for 16 days of that revenue. I used a management contract that stipulates they need to pay staff at all times and they need to account for all the funds . I will gladly refund any funds I owe to them but my question is this.
Dividends are paid after staff correct? and they are behind in GST and employee remittances
Submitted: 2 years ago.
Category: Canada Law
Expert:  Debra replied 2 years ago.
Are you saying that there are staff who have not been paid what they have earned?
Customer: replied 2 years ago.
Expert:  Debra replied 2 years ago.
It's not about taking dividends. This money is owed even if the corporation is insolvent. If the staff are not paid then can complain to the Employment Standards Branch who will get them their unpaid wages for free. And the directors of a corporation are personally liable for unpaid wages as well as for GST and employee remittances.

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