Contractor is owed $, or is he?

[infocus]

What is the name of your state? CA

We are an employer who hired a contractor who performed negligenty and damaged our business and injured our clients.

He would submit contractor timesheets and we would pay him for those. Awhile back we gave him an "advancement on commissions owed" which did not link to any timesheet. We put a note in the check that it was a bonus.

We owe him for his final timesheet, but we feel that he has injured us to such an extent that we want to use the bonus check and apply it to what he is owed. If we do that, he would actually owe us.

Is this legal and can he do anything to fight this? Remember this is not an employee. Also, is there anything we can do, such as file in small claims court?

 

[eerelations]

As you've admitted, this person is not an employee, and is therefore not covered by employment law.

If this person was an employee then no, it would probably not be legal to apply his bonus pay to cover his final pay. However, since he's not an employee, whether or not you can do this depends on the verbiage of your contract with him. In the absence of verbiage on this issue, then you may want to consider not paying him for his final hours worked and wait for him to file a claim against you in small claims court. And let the judge decide.

 

[infocus]

Good answer! We also have a contractor's agreement that he signed. It further states:

"Any dispute or complain originating from our company or our clients against contractor will need to be resolved in full before we issue payment. If resolution is not satisfatory to us or client, we reserve the right to withhold pay or deduct pay at our sole and complete disgression."

We can certainly prove that he did enough damage to withhold pay. But that is a separate issue from the main one, which is we gave him an advancement and want to now apply that to any monies owed.