Posted on 03/14/2016 10:21:55 PM PDT by cornfedcowboy
Here is my dilemma. My brother Jimmy worked for a small tech and robotics integrator for two years. His employer notified him in one day that it would be his last. Jimmy lives in U.S. and his employer lives in French Canada. The next 24hrs the bank trustee shut all things down and has recently put the up for sale. Meanwhile I have a very nice computer they own but have yet to mention they would like it returned. also, the still owe Jimmy $15,00 The question: It has information on my laptop that they already have on the main computer in the office.Does he download all pertinent information to a driver and send them back the office? Jimmy wants to keep the computer because it has plenty of family photos and information.
I dont think I agree with you on that. An employee has better standing in a bankruptcy than an unsecured 1099 creditor. Generally the pecking order is secured creditors, employees and the the rest divide it up. Normally an employer knowing they are going to reorganize will have packed away as much in the payroll account as they think they can get away with. Does not sound like the situation in this case. Happy to be corrected if I am wrong in any of this.
Ideally, yes.
You are correct. Kingu has it correct. Very correct.
You are assuming it is possible to return. There may not be any practical way of returning the item if you don’t know who the liquidator is. It is not unlikely that the office space as well as the furniture was rented and there may not be much to sell. I imagine that the primary value would be in software created and there should be multiple copies
Also, if it is a computer that is over about 18 months old it has very little value. They may not want it.
I’d try to return the files. I’d send an email to someone as a CMA strategy and tell them I had the files and the laptop but if they wanted it back they’d need to tell me who to give it too and provide a receipt for proof I’d returned it.
If they didn’t reply I consider myself to have done due diligence and not worry about it.
How did an employee get to be owed $15k? Sounds more like a contractor.
Owed wages are a completely separate transaction, depending on the verbal or printed hiring policies unilaterally entered into by the employer at the time of hiring, and as modified thereafter. Allowing back wages to accumulate is merely a risky undertaking by both parties, both subjected to loss at the point of baskruptcy. Probably, documented loss of owed wages can be claimed as deductions on the employees federal and state income taxes, not as income, but as tangible losses against any other income sources. See a tax lawyer on that.
Any property in the possession of the employee is due back to the employer immediately, and is a separate matter from the owed wages.
Keeping the property without immediate return after notification to do so could be seen as theft, maybe not just as petty larceny, depending on the value of the asset. If it were an auto, that could be grand larceny. The actual street value will be far less than the book value that will be the amount owed the company if it is not returned. No computer is worth this possible tangle with the law on it. Using company property, even the employees time to make a telephone call for personal purposes, is something no employer would countenance and is a form of theft by the employee.
(Speaking not as a lawyer or Personnel manager, but having been on both sides of the issue for many years, as an experienced opinion. Offered only as sound advice.)
It sounds like this poor guy was burned by a shutdown. Until he is paid in full for back wages, he can and should hold on to any and every “company” asset he controls. ALL his personal information and data should be removed from the “company” computers and they should be set aside, though.
These are his ONLY tools to force compensation for his work.
Dude is gonna get screwed, but at least he will likely keep his data. For whatever that’s worth.
Dang, it looks like I am once again on the wrong side of the legal community that populates this board.
I guess common decency and pair play are LONG gone from the public sphere.
In case you didn’t understand me, I am NOT a lawyer, nor do I play one on TV. additionally, I have NEVER stayed in a Holiday Inn, so evidently my thoughts mean less than nothing. Hooray!
Thank you for the info!
LOL, even if your snark was completely off topic ;)
Copy all the personal info off to a USB. Then don’t delete the info. Use a program that deletes AND overwrites the info. You should overwrite it at least 32 times.
Also overwite the slack space if the program allows it.
Learning here. Who is first in line?
This is a machine assigned to your brother that you have in your possession? Technically, this is receiving disputed property, or could be construed as such.
What I would do in this case is to take the personal information off the computer and give it to your brother who is responsible for it. If I were HIM and being owed wages, I’d write back whoever sent me the request to return the machine and tell them to mail a shipping carton and a prepaid shipping label with which to return the computer. Or he can inform them if they wish to come pick it up, give them an address and a reasonable time frame to do that.
He isn’t under any obligation to pay for the cost to return it himself, particularly if money is due him. In any case, you are an extra step in the process that does not need to be there.
Ask them when they’re going to come get their equipment, then wait. Keep it in good working order. They gave no notice, made no arrangements. No obligation to go out of your way.
If they want the PC, they’ll ask for it.
The PC is like a used pencil. They could care less, in my opinion. The PC is virtualy worthless after a few years. It becomes junk.
Laws regarding payment of employee wages owed normally falls under the jurisdiction of the US state where he worked (which could be different from where he lives) with overriding applicable Federal DOL regulations (whether a state or Federal DOL reg is followed, generally depends on what is the most advantageous to the employee, an example being where a state minimum wage is higher than the Federal). Under normal circumstances and employer may not withhold the payment of wages contingent upon return of company property however the company (or the trustee) has undisputed rights to the property and could sue if not returned.
When you say “Jimmy lives in U.S. and his employer lives in French Canada”, what is relevant is where the work was performed – was that work performed where Jimmy lives or another state or in Canada? Was this a US company and his boss (the person he reported to) just happens to live in Canada? But again where his boss “lives”, aside from a matter of convenience in returning any company property if it needs to be returned to him rather than the trustee, is irrelevant with respect to employment laws.
It is also not clear from your post whether Jimmy is an employee (W-2) or an independent contractor (1099) as that makes a difference, especially in a bankruptcy case. Although I would also mention that far too many companies incorrectly categorize employees as 1099 contractors in order to not pay payroll taxes (FICA), unemployment taxes and other benefits but that is a whole other long and involved topic.
Also you say it is Chapter 11 but Chapter 11 is a re-org and not a liquidation as is a Chapter 7. It could also make a difference if the company is located in Canada, as Canadian bankruptcy laws would most likely apply, although I am not sure, don’t know about Canadian business bankruptcy and that could be much more complicated. If there is a US trustee involved and a selloff of company assets, then it sounds more like US Chapter 7 (See this – Question 26 - Employer insolvency)
http://us.practicallaw.com/1-503-3486?source=relatedcontent
Depending on the type of bankruptcy filed, the rules regarding employment issues may be different. Furthermore, if the debtor has unionised units, the employer will have additional concerns in the bankruptcy proceeding. In certain instances, the Bankruptcy Code favours employees by placing some employee claims high on the priority list in relation to other creditors. In other ways, the Bankruptcy Code can mean the loss of security through cancellation of contracts and collective bargaining agreements. When an individual or entity files a petition for bankruptcy, the bankruptcy court imposes an automatic stay, halting all debt collection activities from the time of the bankruptcy filing and continuing for the duration of the bankruptcy. Under the Bankruptcy Code, a creditor includes any person who has a claim against the debtor that arose at the time of, or before, the debtor filed its bankruptcy petition. A claimant in a pending employment lawsuit is considered a creditor of the defendant employer and subject to the automatic stay. Once the stay is imposed, all litigation efforts by that claimant must cease, and the claimant will need to file a proof of claim with the bankruptcy court in order to maintain the claim against the employer. The Bankruptcy Code excepts from the automatic stay any action or proceeding by a governmental unit to enforce the government's police and regulatory powers, including the enforcement of a judgment other than a money judgment.
Because it is rarely possible for a debtor in bankruptcy to pay all creditors in full, Congress has prioritised distributions to creditors, including past and present employees. Employee wages and benefits are considered unsecured debt and paid according to the priority schedule set out in the US Code.
It is also unclear why (or if) you have a laptop belonging to the company your brother worked for or why it has any of your (or his) personal information, photos, etc., on it. Was your brother a contractor to the company and you an employee of or a subcontractor to your brother? In any case, no matter who is in possession of it, the laptop along with any company owned peripheral equipment (charger, mouse, etc.), and any company information, programs, even in most cases work related intellectual property, etc., (after removing any personal information which word to the wise – never put personal info on a work owned computer) it needs to be returned and your brother is responsible for making arrangements for that. He should contact the trustee to find out how those arrangements should be made. I would think, unless or even if he is a vendor/contractor, it would not be unreasonable for him to request reimbursement for the shipping costs or as someone else suggested, a prepaid shipping container.
He should also contact the trustee and inquire as to how to file a claim for the unpaid wages (or unpaid contractor invoices).
Good luck.
“Jimmy should download his personal photos and info, and assume the computer and work info is property of the company.”
I’d say that’s the best, too. (Worked in the P.C. hell called Human Resources for years.)
Treat the computer as company property and wait until some agent notifies you of what to do with it - doing something illegal because they did something unethical only opens you up to more headaches and heartaches - there might still be a chance he gets some of what they owe him if you don’t jump the gun wit self-righteous indignation (”they wuz wrong so screw them - I’ll flail back because they deserve it”).
The re-sale value or age of the laptop is irrelevant. It along with any company information, programs, etc. contained on it, belongs to the employer or in a bankruptcy to the trustee. It is their call, not his or his brother’s as to whether it should be returned or not. They could very well not want to be bothered with collecting if it has no liquidation value, but that is for them to decide. If the laptop has confidential, sensitive or proprietary information on it, they may want it returned as a matter of security so as they can ensure its secure destruction or the hard drive wiped clean.
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