Legal Question in Employment Law in California

I work for a startup in Austin, as an employee in California, the company is registered to do business in CA. I am VP of sales & marketing. My contract is commission payable on revenue generation, one month after revenue generated. I have not been paid commission - ever - since my start date of 1 July 2009. Overdue now, per COO, is $109K. I asked CEO several times about it but was a "team player" as we all sucked it up during startup. The company now is on the verge of Ch11, the CEO is in prison(federal; unrelated - child porn), new investors are about to come in - they are our primary customer and don't want to go Ch7 due to ownership issues and a state (not CA) emerging technology loan; but want to keep the company going (technology, IP). I've been told I'll be "right-sized" out of the company - laid off. Probably at month-end. (They won't need sales for 12 months as they restructure.) My understanding is that contracted, unpaid salary & commissions all become due when I leave, whether voluntary or involuntary. Recommendations?


Asked on 8/15/14, 9:23 am

1 Answer from Attorneys
Terry A. Nelson Nelson & Lawless

I am amazed you have let this go so long without taking action, unless you agreed tp a 'deferral' of income, or worse, a 'waiver' of income during start up. If you did, oh well, risks taken sometimes come back to haunt.

To pursue this, you will need to file a lawsuit and prove what you claim through paperwork, witnesses, etc. Filing suit will make your claim one that can not be ignored in the takeover/sale. Even if the company goes BK, you are a 'priority' creditor and will make a claim in the BK court. If you are serious about trying to collect this, feel free to contact me for the legal help and representation you need.

Read more
Answered on 8/15/14, 9:45 am


Related Questions & Answers

More Labor and Employment Law questions and answers in California