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Comment by tptacek | Hacker News Reader

You're not going to get the money back. 'grellas may hop on and set me straight on that, but what I expect will happen in the best case is that by pursuing a wage claim you start the machinery that finally puts your employer into bankruptcy, whereupon you become a creditor, lining up with all the rest of the creditors who aren't going to get paid either.

Don't let my belief here imply that you shouldn't do anything; all three of your options are valid. However, in each of them, before you (a) get emotional, (b) burn any potential bridges (even treacherous, slippery ones), or (c) contemplate investing serious time or any money in this process, keep in mind that your outlook on this probably isn't good.

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> You're not going to get the money back.

Indeed, that's my read too, but he shouldn't just shrug his shoulders and give up.

An option: Call them up, tell them you're short on cash and really need the money, and offer to take 1/4th of the salary you're owed if they can pay you shortly and it'd be a huge favor to you and you'd appreciate it.

This removes the small chance of getting the full amount, but it gives the very-important closure and gets the pay off the top idea on your mind - http://www.paulgraham.com/top.html

The cost to thinking about bullshit like this isn't considered enough. Offer to take two weeks pay and sign away the rest. Then be very, very grateful about it, thank them and say it's a big favor to you and you're rooting for them. You lose the small chance of getting full pay, but you get something and can move on with your life and devote your mental energy to other things.

Edit: The other nice thing about this route is that after going through that process, you're no longer a creditor to them and can call them up more freely without them tensing up and feeling the pressure. Depending on how valuable the contact/reference is for you, that could be better than going more hostile. If you did want to go hostile, small claims court might be a better bet than the wage board, depending on what the cap is in California. Small claims doesn't require a lawyer and is pretty straightforward to navigate on your own.

Why would they give him 1/4th the salary? Could he sign away his right to demand the full salary, or would any such agreement be unenforceable if he decided to come after them later?

I'd support the legal system allowing him to sign an agreement accepting a lower amount and making that final, but I wonder if it works like the minimum wage, where workers can't sign away their right to be paid at least the minimum wage.

(IANAL, but my business law professor was...) Contract law says that if you say you'll take X paid "shortly" instead of the full amount Y in a situation like the OP describes, it does not prohibit you from collecting the remaining amount later. Even if you sign a contract that agrees to settle the debt, that contract isn't valid because the employer is not providing any consideration in that instance.

Having said that, I was in a similar situation and basically just gave up ever seeing the money for the same reasons others have already given.

Thanks for your input tptacek. When I spoke with one of the VP's he also said that there wasn't much I could do to go after the money. But I thought he might be trying to prevent me from doing anything against the company.

What you described about kicking off the bankruptcy process is pretty much how I pictured it. They have implicitly made me an interest-free lender.

One of the hard lessons of life here for me is that I am really hesitant to trust any people in business now. I now understand why unions exist.

"whereupon you become a creditor, lining up with all the rest of the creditors who aren't going to get paid either"

I was under the impression that employees owed wages are paid before other creditors, which means OP would have a better chance of getting something.

I've heard that through the grapevine, and other commenters have concurred, but I've never confirmed it.

Update: according to 11 USC Section 507, wages fall in 3rd place. I am not a lawyer so I may be reading this all wrong, but it goes "administrative expenses", "unsecured claims", then wages up to $4000 (about half of what I'm owed) and earned within 90 days of the bankruptcy filing. It's been about a year since I quit the company, and the wage claim through the labor board has a 3-year statute of limitations. I wonder what would happen if I filed a wage claim on a bankrupt company...

(http://www.lawdog.com/bkrcy/bkmd3.htm#726.)

It's worth noting that if you do resort to pushing the company into bankruptcy, at best you'll get nothing, and at worst you'll make things even more difficult for the founders than they already are.

That is my fear in pushing too hard. I actually do want the company to succeed, but I just don't have the wherewithal to give the company this free loan.

Except, you're very likely not going to get the money, so I hope the "don't have the wherewithal to give the company this free loan" is an exaggeration. You should cut your losses. This is a sunk cost for you. Use your creativity to work on furthering your ambitions and career from here. Live for the future, not the past.

Make it their fear - they are still in business, so somebody is getting paid.

Call them up and tell them straight out that they have a week to get the money otherwise you go after them in court, which will throw the company into banckruptcy.

"they are still in business, so somebody is getting paid."

It's actually possible that no one is getting paid and equity and commitment are driving the ones that are left.

I doubt - that, they would have to pay for rent, utilities, internet, etc.

Getting paid isn't just workers, but is also the other businesses.

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