Can an employer withhold wages, if I refuse to sign a contractor agreement?

After being laid off, I worked for my former employer as an independent contractor. As an independent contractor, I provided consulting services to a customer of my former employer. The contract was for 45 days but prevented me from engaging with the customer for 1 year. I did not sign the contract. The work was extended for for an additional 80 days. The employer was paying me bi-monthly but will no longer pay me until I sign the agreement.

2 answers  |  asked Jan 11, 2010 1:41 PM [EST]  |  applies to Pennsylvania

Answers (2)

Harold Goldner
If you're an independent contractor, and the person for whom you are performing services requires a signed contract, you need to sign the contract.

That having been said, there could be all kinds of 'gotcha's' in that contract (such as non-compete or confidentiality provisions outlined by Chris Ezold above) --- so your best move is to get that document they want you to sign and take it to a lawyer.

posted by Harold Goldner  |  Jan 11, 2010 1:59 PM [EST]
Christopher Ezold
Before I respond to your inquiry, I must state that we have not spoken, I have not reviewed the relevant documents and facts, and I do not represent you. Therefore, my discussion below is not a legal opinion, but is informational only. Finally, my discussion applies only to issues to which Pennsylvania or Federal law apply, unless otherwise specified.

That being said, your employer must pay you for work performed, but does not have to continue to employ you if you don't want to sign a noncompetition or nonsolicitation agreement. If your employer doesn't pay you, then you have a right to (a) your wages, (b) a 25% penalty, and (c) attorneys' fees.

You have a bit of a complicated situation. Your employer can refuse to contiue to employ you without your signature on a noncompetition or nonsolicitation agreement - but must pay all back wages. A general requirement of restrictive covenants like a noncompetition agreement is that it be related to employment OR the sale of a business. Since you are classified as an independent contractor, the restrictive covenant may not bind you at all, regardless of whether you sign it. However, you may be an employee - just being called an 'independent contractor' does not determine whether you really are one.

If you don't have real control over your employment, and can't essentially make a profit (as opposed to wages), then you may be an 'employee' - that is, you may have a right to unemployment, worker's compensation, and your employer would have to pay 1/2 of your FICA/FUTA taxes (resulting in a lower tax burden for you unless you take significant business expense deductions). I can't tell if you truly are an employee or independent contractor from the facts in your question.

If you would like to discuss this matter further, please feel free to contact me at the below address(es) or number.

/Christopher E. Ezold/
Nancy O'Mara Ezold, P.C.
One Belmont Avenue,
Suite 501
Bala Cynwyd, PA 19004
(610) 660-5585

posted by Christopher Ezold  |  Jan 11, 2010 1:57 PM [EST]

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