I think I am being blackmailed.
I own a business in the state of Florida and recently had to fire an incompetent employee. The employee got paid both hourly and a percentage of sales as commission. The firing was indeed justified, and this is not the matter being contested. A couple weeks after the firing, I get a letter from this person saying they think they are owed $1500 for a number of reasons including mysterious commission sales, gas and vehicle costs, etc. I do no have a problem with this part, and am more than happy to sit down with the ex-employee and figure out if there was an unfairness. I keep ALL sales very well documented.
However, after explaining this in a response to her/him, the ex-employee responded in a second letter, demanding an arbitrary, unfounded, and undocumented amount sum of $1000 *or else* he/she will report me to a number of state and federal agencies for cutting some corners with my business, including not paying payroll tax or documenting the employee. It is true, I have not paid this tax because of very large grey area in Florida law with commission sales. I thought I could technically claim him/her as a independent contractor. But even if this is not the case, and I have to pay the owed money, isn't this still extortion? The payroll tax has nothing to do with him/her or his/her "owed" commission. She was fired and therefore does not qualify for unemployment.
So in short, is it blackmail if an ex-employee demands an arbitrary amount of money (that they feel they are owed) *or else* they will blow the whistle on my shaky business practice of not paying payroll tax? They are unwilling to negotiate the amount of money that is supposedly owed. He/she is basically demanding shut-up money.
I am leaving as much detail out of this as possible in order to maintain security of this matter, just let me know if there is any other vital information that is needed and I will be happy to provide it.