4 ms·

I've dealt with late payroll before and the fear, uncertainty, and stress really sucked. I was even considering offering the company a 50% haircut on the wages

by desdiv 10y ago

I've dealt with late payroll before and the fear, uncertainty, and stress really sucked. I was even considering offering the company a 50% haircut on the wages that I rightfully earned already just so the stress would go away. Is there any bank or payroll company that offers a wage escrow service? As in, the company pays X months of wages in advance into a per-employee escrow account that's FDIC insured, and the employee can log in at any time to verify its balance.

pyre 10y ago
When Target declared bankruptcy and pulled out of Canada, they setup a trust (or something) to give all employees 4 months of wages. They all got 4 months of wages, but some stores closed sooner than others, so some people ended up working for 4 months while others ended up basically getting paid to do nothing. You might look into what Target used to set this up.
- desdiv 10y ago
  Good for them. Sounds like they had to setup a trust: >“Therefore, in what we believe is an unprecedented move, Target Corp. is voluntarily seeking to establish a trust that we will fund with C$70 million. Those funds are designed to provide nearly all Target Canada employees with a minimum of 16 weeks of wages and benefits coverage during the wind-down period.” http://www.huffingtonpost.ca/2015/01/27/target-canada-severance_n_6556442.html http://www.huffingtonpost.ca/2015/01/27/target-canada-severa...
  - pyre 10y ago
    From what I understand, at the point they declared bankruptcy they (Target Canada) didn't have enough money to meet payroll obligations, and the trust was seeded from Target's US operation. It Target Canada had just been standalone chain (i.e. no Target USA), then this probably wouldn't have been possible.
- triplesec 10y ago
  Great brand management and value culture by Target there. They are fortunate to have deep pockets to be able to do this, of course
kondro 10y ago
I think it would surprise you to know the number of companies that lack the cashflow to be able to do this.
toomanybeersies 10y ago
A lot of companies would really struggle to put more than one or two pay cycles of pay in escrow. I'd imagine less so for tech startups, since in their early life most of their money comes in big chunks of funding, but for a lot of smaller businesses that are self profitable (restaurants come to mind), they can't afford to keep wages in escrow, because that's money they'd have to borrow.
gaius 10y ago
The State of California takes a VERY dim view of employers who can't/don't make payroll. There should theoretically be no need for escrow; the prospect of going to jail should give management sufficient incentives. I wonder if this isn't well known tho' from the number of startup stories on here about late/withheld wages.
kingofspain 10y ago
It's a good thing you didn't go for the 50% haircut. I did that once many years ago & it backfired horribly. I got around 40% in the end - dragged out over 8 months - and the MD used my 'willingness' to take the haircut as a sign that I knew that I didn't deserve the full amount and hadn't really earned it. He's still merrily scamming away all these years later I hear as well.

by desdiv 10y ago

pyre 10y ago

When Target declared bankruptcy and pulled out of Canada, they setup a trust (or something) to give all employees 4 months of wages. They all got 4 months of wages, but some stores closed sooner than others, so some people ended up working for 4 months while others ended up basically getting paid to do nothing. You might look into what Target used to set this up.

desdiv 10y ago
Good for them. Sounds like they had to setup a trust: >“Therefore, in what we believe is an unprecedented move, Target Corp. is voluntarily seeking to establish a trust that we will fund with C$70 million. Those funds are designed to provide nearly all Target Canada employees with a minimum of 16 weeks of wages and benefits coverage during the wind-down period.” http://www.huffingtonpost.ca/2015/01/27/target-canada-severance_n_6556442.html http://www.huffingtonpost.ca/2015/01/27/target-canada-severa...
- pyre 10y ago
  From what I understand, at the point they declared bankruptcy they (Target Canada) didn't have enough money to meet payroll obligations, and the trust was seeded from Target's US operation. It Target Canada had just been standalone chain (i.e. no Target USA), then this probably wouldn't have been possible.
triplesec 10y ago
Great brand management and value culture by Target there. They are fortunate to have deep pockets to be able to do this, of course

kondro 10y ago

I think it would surprise you to know the number of companies that lack the cashflow to be able to do this.

toomanybeersies 10y ago

A lot of companies would really struggle to put more than one or two pay cycles of pay in escrow. I'd imagine less so for tech startups, since in their early life most of their money comes in big chunks of funding, but for a lot of smaller businesses that are self profitable (restaurants come to mind), they can't afford to keep wages in escrow, because that's money they'd have to borrow.

gaius 10y ago

The State of California takes a VERY dim view of employers who can't/don't make payroll. There should theoretically be no need for escrow; the prospect of going to jail should give management sufficient incentives. I wonder if this isn't well known tho' from the number of startup stories on here about late/withheld wages.

kingofspain 10y ago

It's a good thing you didn't go for the 50% haircut. I did that once many years ago & it backfired horribly. I got around 40% in the end - dragged out over 8 months - and the MD used my 'willingness' to take the haircut as a sign that I knew that I didn't deserve the full amount and hadn't really earned it. He's still merrily scamming away all these years later I hear as well.