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  1. #1
    Join Date
    May 2013
    Posts
    6

    Default Company Says Pay Date is Start of Pay Period, Do I Give Back Money

    My question involves labor and employment law for the state of: MA

    At the end of November, it was decided that I should leave my post as co-founder a small startup (Delaware C-Corp if it matters). It was mostly a mutual decision, but I'm calling it "termination" because the CEO made the final call that it wasn't going to work out. We parted on mostly good terms. We didn't agree on a specific plan at all, and we didn't discuss what my final day of employment would be.

    On Dec 1, he offered me a severance package (in exchange for signing a separation agreement) with 1 month's pay, but he said that apparently our paychecks come at the START of each pay period. So basically, the paycheck that I just received in my back account on Dec 1st was for the NEXT 2 weeks, and the company would give me an additional 2-weeks of pay. I've never received pay stubs, but he sent me some PDF printouts from Quickbooks (our payroll service) and the "Pay Date" and "Period Beginning" fields are the same date.

    If this were a normal job, I could look back at my pay history and make sure I've received a paycheck for every period that I've worked. In this case though, there's a catch: as a co-founder, I worked for a long time with no salary. When we started receiving a salary, there was no official communication of what the start date was. And we never received pay stubs. My assumption was that paychecks corresponded to the previous pay period.

    On top of that, the separation agreement feels way too restrictive for my comfort. Release of Claims, Nondisparagement, excessive Transitional Services. I'd almost rather just not get paid, and not sign all my rights away.

    So: can the company force me to give back that money? Is it a reasonable expectation? And am I being unreasonable for feeling like it's kind of shady?

  2. #2
    Join Date
    Sep 2005
    Location
    Behind a Desk
    Posts
    98,846

    Default Re: Company Says Pay Date is Start of Pay Period, Do I Give Back Money

    We are not going to be able to tell you when your pay period begins and ends. We have no access to any corporate records.

    If you were overpaid, then you can be asked to return the money which was paid to you beyond your earnings. Whether or not that's reasonable or supportable is not something we can assess. What your employer is describing would be very odd, so I would expect a court to be skeptical of the claim that all paychecks were effectively advances on earnings rather than payment for work performed; also, the manner in which the payroll was maintained on the books and the timing of the payment of payroll taxes may suggest something different.

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