Mr. GilaB used to work at a small hedge fund that used MF Global as their prime broker. In the wake of the MF Global debacle, when for weeks all of their money was frozen, the secretary was laid off, and everybody else furloughed for the month of November. A month later, the few who received regular paychecks, rather than a percentage of their profits, got laid off as well. (They’re the company described in the last few paragraphs of this New York Times article, from the beginning of the crash.) Mr. GilaB was one of these. Months later, he’s working elsewhere, the fund has gotten much of its money back, and is at least partially up and running again, but Mr GilaB (and the secretary Sandra L., quoted in the article) have never gotten their pay for October and the first week of November that they worked. He’s politely asked the owner of the hedge fund several times, and said owner, let’s call him Jeff, has either dodged the question, or essentially told him to get in line with other creditors. Jeff has lost many millions of his own money in this, but has also made a very fancy family celebration recently (probably at least $75K), and still sends his children to their $40K-a-year-each prep school. Jeff’s been careful to respond only via phone, never email.
My understanding is that wages must be paid on time unless the business goes bankrupt, which this one hasn’t. Also, wages take precedence over other debts, meaning that Mr. GilaB is, in fact, at the head of the line of creditors. Mr. GilaB is reluctant to antagonize someone who was, in many ways, a good boss and mentor, and also doesn’t want to get a reputation in the finance world as a litigious guy. Anybody know what the law is? My guess is that it’s time for Mr. GilaB to talk to the relevant government officials, as I’d think this is a crime of some sort, or at least a violation, but I’m not sure who to talk to. Or is it a civil matter?
I’m not a lawyer, but here is a list of state final paycheck/payday law. Scroll down to NY. In NY whether the employee quits or is fired, it is the same, the next scheduled payday. Barring any legal surprises, he is not only holding out he is breaking the law.
You can send him a certified letter/return receipt requested of your desire for him to comply with the law immediately or an attorney will be consulted and also the state labor board or whatever agency handles employment matters will also be contacted.
Check with your state Labor Dept. I bet they’d be glad to go to bat for your husband, or at the very least give you chapter and verse re: what he is owed and under what section of law. If you end up needing a referral for a NY labor attorney, PM me; my stepmom is one - she’s not in private practice, but I bet she could recommend someone.
This is where your union comes in, oh right hedge fund. Sorry no sympathy from me but yes in Aus we have a fair work ombudsman who would sort this out lickety split. Bloody government interference can be a good thing sometimes.
But you are right wages come before other debtors unless he was employed as a contractor.
If employment is terminated, the employer shall pay the wages not
later than the regular pay day for the pay period during which the
termination occurred, as established in accordance with the provisions
of this section. If requested by the employee, such wages shall be paid
by mail.
Looks like it’s a misdemeanor in NY with a fine up to $20,000, and up to 1 year in prison. Employer may also be subject to a civil penalty of $500 per occurrence. And your husband may be entitled to damages up to 100% of the wages due.
For what it’s worth, we are not wealthy, although thankfully we can afford what we need, plus a few luxuries like occasional nice restaurant meals and annual-ish backpacker-type vacations. This came at the tail end of a long period of unemployment for me that stressed our household finances, although now that we’re both working, everything is going much better, and these withheld wages won’t make or break us. Not everybody in the hedge fund world is making millions of dollars annually.
Sure, but there’s no need to feel apologetic (which is how this comes across, sorry if I misread you) about wanting to be paid for your work. The business has essentially taken your husband’s time and effort, and he is entitled to be paid. Whether or not you’re able to pay your bills and eat is kinda beside the point.
The law exists to protect everyone, not just those who ‘need’ it.
Thanks. It’s just that everybody hears ‘hedge fund’ and assumes that we eat off gold plates, drive an Aston Martin, etc. I’ve probably grown defensive after years of it.
Section 190.7 of the New York State Labor Law excludes from wage payment coverage those persons in an administrative, executive or
professional capacity whose earnings exceed $900 gross per week
My question about that (which I saw also) is, does that mean that the state won’t pay your back wages, or that the state won’t help you recover them? I certainly don’t expect the state to pay us for Jeff’s bad behavior, but it’d be nice to bring in the authorities.
The State won’t pay your husband’s wages but the courts may force the employer to pay them.
As for Section 190.7, the limitation is only designed to exclude executives from certain requirements of Article 6 such as frequency of wage payments. So even executives are considered to be employees unless expressly excluded by the statute.
See this case: No. 86: Pachter v Bernard Hodes Group, Inc.
The case you cited has nothing to do with the OP’s problem. Wage payment coverage doesn’t mean what you think it means. If you weekly wages exceed $900, NYSDOL will not assist you with collecting the wages due to you. You have to handle it yourself in civil court.
See? Right at the top of the NYS “Claim for Unpaid Wages” form.
I had unpaid wages in New York quite a while ago. At the time the limit was much lower, as in $400 , and their response was sorry, your salary is over the limit. File in small claims.
NYS does not pay back wages to people. What they can and will do, if you make less than $900 per week, is go after the employer for your unpaid wages. Most employers end up paying because of the sheer hassle and penalties involved.
I don’t know how much $$$ is involved in your matter, but it is usually worth it to hire an attorney. I hired someone, and ended up with more $$$ than I was due, plus legal fees. This was around 1988 or so, and I had a $700 wage claim.
Come to think of it, I had an unpaid wage claim back in 1981 or 1982 that NYS did help me with. It was for around $240. It took about four or five weeks, but they did get the employer to pay. I was slightly shorted, maybe $10 or so, but I did get paid.
I had an unpaid final cheque from an employer once, and the first step was to send them a registered letter saying (to paraphrase): “This is the first step of legal proceedings to get my damned money, jerk. Pay it or I see you in court.” It worked for me - my former employer gave me my money right away, and acted all butthurt, like there was no need for me to start proceedings against him - he was going to pay me all along (yeah, whatever). That would be my first step here - try the registered letter (possibly one written by a lawyer), and see how far that gets you. Once you start the paper trail of him not paying what he owes, he might suddenly cough it up. If that doesn’t work, it’s definitely time for limited lawyer involvement (you don’t want to spend more than you’ll take in).
Anschuldigs - Mr. GilaB is a trader. He was something of a jack-of-all trades at JeffCo, but he primarily figures out how to buy and sell things better, e.g. I need to buy a lot of this thing that people at my fund want me to buy without driving the price of it up too much, or letting anybody else figure out what we’re doing.
His weekly gross wages did exceed $900, so I suppose we’re on our own.
Is a registered letter so much better than email with regard to a paper trail? After months of him emailing his boss, and his boss trying to call him back, Mr. GilaB finally insisted on a written reply today, and got one. Jeff acknowledged that the amount owed was approximately correct, implied he was planning on paying up in the next few months without actually saying so, and said they should talk after he gets back from his vacation (leaving tomorrow, coming home ‘the first week of April.’) If it’s just a matter of a lawyer letter via registered mail, we have enough lawyer friends with legal letterhead that it ought not to be a big deal to get one.
That said, I think we’re getting to attorney-hiring time. This is someone who’s delayed and made excuses about paying Mr. GilaB all along (a raise wasn’t possible just now because of yadda yadda; he couldn’t give him a bonus this year (in finance, a large portion of your annual salary is generally bonus) because of blah blah blah external factor), always promising that good times were just around the corner and that Mr. GilaB would get his bonus/raise/whatever soon. He liked the working environment and learned a ton, but it was getting to be time to move on soon anyway. Mr. GilaB is now worried that Jeff is going to rename his company at some point soon during the relaunching, and empty out the legal entity that owes the money, so I think we need to move quickly.
I think I’m this angry because this is just so petty. The guy is absolutely in the wrong and must know it, and has the money. We’re talking about $6K, not millions of dollars.
