“My Employer Didn’t Pay Me, Now What?”

I often get calls from prospective clients who have not been paid by their employer for a period of time, sometimes as long as a few months. In some instances, the issue stems from the employer being a start-up company, and in other situations it can involve a medium to large company experiencing cash flow issues.

B.C. Employment Standards Branch

I advise these prospective clients to call the B.C. Employment Standards Branch (ESB) with respect to an unpaid wages complaint. Alternatively, the complaint can be made on the ESB website here. The ESB will assign an investigator to the complaint who can make an order against the company to pay the unpaid wages. Once an order is made by the investigator, the employee can enforce the order. Here, up to 2 months of unpaid wages can be enforced against the personal assets of the directors and officers of the employer, pursuant to section 96(1) of the B.C. Employment Standards Act. Notably, this personal liability of directors and officer is not present if the employee were to bring the unpaid wages claim within a lawsuit through the courts.

ask for salary

Pay for employee’s time.  Source: bigstockphoto.com

Constructive Dismissal

In addition to an unpaid wages complaint, the employee who has not been paid in exchange for services would also have a claim for constructive dismissal under common law. Here, the law provides that an employer who fails to pay wages is deemed to have “repudiated” the employment agreement for not paying wages, thus entitling the employee to treat the employment relationship as coming to an end, and having the legal right to sue for severance as if he or she had been terminated.

Time to Seek Professional Help

Unlike an unpaid wages complaint through the ESB without the assistance of counsel, it would be recommended to seek counsel with respect to a constructive dismissal claim. Before commencing a constructive dismissal claim through the courts, it’s important for an employee to assess the employer’s ability to pay any court award that the employee might receive after a successful (and potentially expensive) lawsuit. Remember, you cannot draw blood from a stone. If an employer cannot even pay wages, it is important to assess the financial status of the company and whether it is worth to pursue a lawsuit to obtain a court judgment that the company might not have the resources to pay.