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Employee Misclassification, Wages withheld for "Pay-if-Paid", Unlicensed Agents signing contracts and supervising work

LouisianaCollectionsConstruction ContractLicensesNotice of Intent to LienPay When PaidPayment DisputesRight to LienSchedule of Values

I was currently hired by a General Contractor as a project estimator, roofing sales person and project manager. At the time of being hired, the GC offered me a 12% commission on all work jobs sold and contracts signed and a "daily rate" of about $200 for any work done on the production side of things, i.e. meeting subcontracted laborers at work site at beginning of job, collecting payment, putting out fires, etc. Since starting at the beginning of December, I've done about $350,000 worth of revenue, and really like my job. I was trained for 2-3 weeks on my GC's method of work from interacting with customers, writing estimates, pitching jobs, and performing inspections and I also signed a non-compete contract to not work with any other companies and the week I started two other estimators were fired for advertising their services on their personal facebook pages without giving proper significance to the GC's company. (Since starting, all of the jobs I've sold on behalf of the GC's company, all of his subcontractors and employees are 1099'd) When researching his GC license, the is status is set as "in bad standing for unpaid fees" and he is listed as a managing member for the license but it is for an individual that has not worked with company for years. Now that you have some context: Do I have any legal exposure for signing contracts and running jobs with with potential customers as an independent contractor for my company if I am unlicensed myself? Can the owner of my company legally not pay me unless he is paid when he is forcing me not to work with any other contractors, remain "on call" from 7am-7pm 6 days a week? Recently, I have been having trouble getting our subcontracted laborers finish some work at a property, I have already worked at this property for a total of 45 hours and have yet to be paid for it, I believe the sub has been absent and ignoring my calls because he has been yet to be paid as well. The homeowner is dissatisfied with some of the work quality and wants additional work and repairs done at no charge, putting me in the middle of situation, unpaid without any leverage to collect. I feel like our working relationship indicative of one as a traditional employee rather than an independent contractor so if anyone could give me clarification on that it would be great as well. I was told by a friend in the industry that he believes any contract I sign on the companies behalf as an unlicensed agent or representative is legally null and void or that I can technically be sued for not having insurance or a license when our contracts are reflect that I, the signing party am a GC with the state, rather than the GC who owns the company. Please let me know what my options are to get paid, if my status as an employee is misclassified, if I have any legal exposure for signing these contracts, if the contracts I sign are legally binding, what options I have to create leverage to get paid for unpaid wages, and do I have any rights to collect payment for exclusivity and being forced to be on call for 72 hours a week?

2 replies

Feb 22, 2022

You probably have legal exposure for selling contracts if you know that your company is not licensed. Further, those contracts are absolute nullities and the homeowners may not end up actually paying, so functionally it is a very bad idea. You may be considered an employee instead of a subcontractor based on your description above. There is a "control test" about how much your employer controls what you do rather than a true independent contractor who works as much and in whatever manner he wishes. Also, I don't know that you can have a non-compete with a 1099 independent contractor, so that clause is likely either invalid or you are an employee or both. 

Your likely remedy is a FLSA claim or a breach of contract claim or some combination of both. Understand that this all pretty general advice without reviewing the entire situation I cannot guarentee accuracy.  

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Feb 22, 2022
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