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Can I take this subsidiary and/or parent company to small claims court?

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Lnichol

Junior Member
(State: New York)

Earlier this year I worked at a video and social media content production company as a full-time in office freelancer. In February the executives gave the entire company only 24 hours notice that the company was "closing it's doors" and thereby laying-off all 100-ish employees and freelancers. Since then, none of the freelancers have been paid their last paycheck (for 2 weeks of pay), despite submitting invoices while the company was still open and while being told we would be paid. We continued to keep in contact with the company's accounting email over the next month or so, and the company has liquidated it's assets.

Since then the company announced it has been acquired as a subsidiary to a parent company. They re-opened using the same name, the same website, the same social media fronts, and both parent and subsidiary have publicly released articles announcing the acquisition. After having our emails ignored for about a week, I finally got hold of the subsidiary's accounting email once again, who only claimed that the subsidiary company closed it's doors on February 28th, liquidated it's assets and can no longer pay any debts, all this despite the company's continuous activity. The company even recently re-hired around 25 employees from before their closure (so they clearly have a source of money, from the parent company I assume).

Do I have a case in small claim's court (and how can I take action if they have relocated, will not provide an address or number, and ignore emails)? Also, if possible/necessary, would I be able to pierce the corporate veil and hold the parent company accountable?
 
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HRZ

Senior Member
IT is rather a unclear if you were a bona fide independent contractor or an employee...the default position is you are an employee unless the facts line up that you were a true IC ...the company can call you whatever they want ...but the law and facts is what counts.

IF you were an employee...file a wage clam with the appropriate NY agency ...let them sort it out . Failure to pay employees can be a big deal....

IF you were a true IC which is so far yet uncertain....NYC passed a law sometime last year to protect " freelancers " ..I know Zero about how it works ....google and go.
 

HRZ

Senior Member
If you were a true freelancer but not in NYC ..then the NYC law doesn't help...sorry I didn't see where in NY you are..
 

adjusterjack

Senior Member
Do I have a case in small claim's court (and how can I take action if they have relocated, will not provide an address or number, and ignore emails)? Also, if possible/necessary, would I be able to pierce the corporate veil and hold the parent company accountable?
It's possible that the parent company purchased the assets without the liabilities.

How much money is involved?
 

Lnichol

Junior Member
IT is rather a unclear if you were a bona fide independent contractor or an employee...the default position is you are an employee unless the facts line up that you were a true IC ...the company can call you whatever they want ...but the law and facts is what counts.

IF you were an employee...file a wage clam with the appropriate NY agency ...let them sort it out . Failure to pay employees can be a big deal....

IF you were a true IC which is so far yet uncertain....NYC passed a law sometime last year to protect " freelancers " ..I know Zero about how it works ....google and go.
It was unclear the way they presented it. But going by paperwork that I was given, I was a freelancer, not staff. No benefits, and had to invoice. I'm confident I wasn't an actual employee.
 

Lnichol

Junior Member
It's possible that the parent company purchased the assets without the liabilities.

How much money is involved?
That's what I thought too, but I wasn't sure if that was possible. It's really not a lot (since they paid pretty poorly). But the thing is, depending on what we choose to do, it's not only my paycheck. I am in contact with 4 others in the same situation with them. All together our sum would be around $4500-$5000. Personally, they owe me only around $1K.
 

HRZ

Senior Member
What their paperwork says is NOT determinative...its what NY and Federal law say it is ...and if they control where you work, when you work, set your pay, prevent you from doing similar work elsewhere, supply space or tools of trade ..the odds strongly favor that you were an employee ...at least do more homework . IRS S-8 form may be useful . IF there are several of you that I n common boat...the numbers add up.

Misclassification of workers is not rare ...

Just me, Id be inclined to file a NY wage claim soon ....plus sort out if the new freelance law in NY might apply...and file that way too ....
 

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