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I had worked as an employee for an organization. I had signed standard paperwork before starting, including an employment agreement that had their name on it. I latter found out that the organization was not registered as a business or an non-profit. It may have been that it was not it's own legal entity and they were more of a department of a parent company. I was told that if I had to bring legal action against them it would have been a problem to prove that I served the correct address because a corporate directory search (amongst other types of searches) returned nothing. I'm not sure how true this is, I know there's different rules for service depending on what type of organization is being sued (e.g. "how to serve...").

When is an organization its own legal entity that can be sued and held accountable? Even if an organization wasn't its own legal entity, would you still be able to sue the individual who said you would get paid for doing the work?

Usually an employer-employee relationship is obvious and only involves the two parties. Sometimes it's not. For example what if the answer to the following questions do not match up? Does one take precedence?

  1. What is the employers name according to the written employment agreement?
  2. What is the name of the organization issuing payment?
  3. Who is telling you what work to do and how to do it? Are they working for the same organization?
  4. What branding and names are on the work equipment? This could range from email domain from work email, to what sign is posted on the door of the office.

As a simple example I did short term work for Mega Corp. A staffing agency connected me with the work. I noticed payments were actually coming from the staffing agency as opposed to Mega Corp. I asked about it and they said it was to simplify administrative processes and paper work. Had I had an issue getting paid would I take legal action against Mega Corp or the staffing agency?

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  • Though I added Canada, BC as a tag, I'm curious how it works elsewhere too. Nov 23, 2023 at 2:47
  • It seems that the question may be "if you sign a contract purporting to be with a company that doesn't actually exist, and yet there is some unknown party honoring the purported company's obligations under the agreement, is there a contract with the unknown party?" Is that in fact what you're asking?
    – phoog
    Nov 23, 2023 at 8:55
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    I would also note that the question "legally speaking who is the employer" may have -- and probably does have -- different answers for different purposes. For example, the party that the government holds liable for payroll tax obligations could conceivably be different from the party that is liable for occupational safety compliance.
    – phoog
    Nov 23, 2023 at 12:35
  • @phoog "Is that in fact what you're asking?" maybe...I think a related question is when does an organization officially exist, at least in the sense that you can sue it? Nov 26, 2023 at 8:51
  • @phoog if you see fit, please upvote this question so it gets more attention Nov 26, 2023 at 8:53

2 Answers 2

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I am not sure why you have four different points there, maybe because other countries handle it differently.

Whoever is listed in your contract as the employer, is the employer.

I know, underwhelmingly simple for a country this much in love with laws and paperwork.

If you are the employee of an employer, as long as you get your money as stated in the contract, and in accordance with all other laws (no later than X, minimum wage, must be EUR, etc) I have not yet met a law that said which account it has to come from.

There is only a single entity that can tell you what to do: that is the entity you have a contract with. That entity can have a spokesperson if it is not a natural person and those can delegate this authority to proxies. In other words your company can tell you who your boss is. The only final authority on this, again, is the entity you have a contract with. If they tell you to paint Mr. Does bathroom and during that time follow Mr. Does directions on color, then that is fine. It doesn't make Mr. Doe your employer.

Branding on the work equipment, again, is the sole domain of your employer. If you work for a subcontractor of DHL, you will ride a DHL branded truck. But you work for the entity on your contract, not for DHL.


That said, some notable exceptions:

Germany tries to get a hold on fake self-employment. That is self-employment that is only filled out because when self-employed most protective labor laws don't apply to you and the company can exploit you more readily.

So many of the above things would come into play to differentiate between real self-employment (lets say you are a painter and paint a different kitchen every week, making a living) from fake self-employment (you are a butcher and work in a single company's meat packing plant, but they pay you below minimum wage because officially, you are a self-employed butcher that just happens to take job after job for less than cost-of-living at the same plant).

Also, telephone registry and email address are often taken as means to prove that someone was actually employed at a specific company and was in fact not a temp or contractor.

But if you are in fact employee of another employer, then this doesn't really concern you. You are covered by labor laws and that is all that matters.


To answer your specific question:

Had I had an issue getting paid would I take legal action against Mega Corp or the staffing agency?

Whoever signed the contract stating they owe you money for work.

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  • "Whoever is listed in your contract as the employer, is the employer...There is only a single entity that can tell you what to do: that is the entity you have a contract with": but the purported entity seems not to exist. The four questions are not "different points" but show a hypothetical situation where facts that normally align do not align. For example, you've signed a contract that purports to be with "Alice's Antiques," but your payment comes from an account in the name "Bob's Books," while your tasks are directed by a person called "Carol," and the office is branded "DaveCorp."
    – phoog
    Nov 23, 2023 at 8:50
  • @phoog So? Why do you care what account you are paid from? Why are you taking any directions from "Carol", if not directed by "Alice" to do so? Why do you care if the office is branded "DaveCorp", as long as Alice directed you to work there and Alice is paying you for it?
    – nvoigt
    Nov 23, 2023 at 9:14
  • It might not be ovbvious, but in Germany, a written contract is mandatory. So the scenario where you may or may not have multiple just implied or verbally made conflicting agreements just doesn't happen. You have signed a contract twice, one for you and one for your employer. The other signing party is your employer, period.
    – nvoigt
    Nov 23, 2023 at 9:29
  • And what if no actual company exists with the name on the contract? I mean obviously that would be irregular and perhaps the contract is void, but if so there ought to be a line of reasoning leading to the conclusion that the contract is void -- or that some actually extant party is bound by it. If the contract is void, what impact does that have on any work done by or wages paid to the purported employee?
    – phoog
    Nov 23, 2023 at 12:32
  • @phoog: "And what if no actual company exists with the name on the contract?". That is arguably a separate question :-). According to my (limited) understanding, that would a) probably be fraud (you set up a contract listing a company that does not exist), and b) the person who wrote the contract and/or convinced someone to sign would be considered the "other party" - so whoever did this would be personally liable for your salary.
    – sleske
    Nov 23, 2023 at 12:38
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In many circumstances, it is possible to have more than one employer. For example, in an employee leasing arrangement, both the agency with the contractual relationship with the person that handles payroll and the entity that directs the employee, are employers for some purposes.

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