vacation and under the table payments

[wfoley]

i have worked with my current company since jan of '99. i was told this past friday that i am no longer an employee. i am now a "consultant" to the company and to bill them for my net pay. it was implied that i would not be receiving a 1099. so i would be doing the same job, just being paid under the table. my first question is are they required to pay me for the 4.5 weeks of vacation that i have accrued? the second is couldn't i still get into trouble if i didn't report my earnings even though i didn't get a 1099? i am really in a hard place now because i need the money for my bills and i don't have other work lined up. but i don't want to end up getting in trouble either.

[cbg]

I'll tackle the easy one first.

No Ohio law and no Federal law requires an employer to pay out unused vacation at termination, or, for that matter, at any other time.

As to the rest of it, I think you need to be in touch with the state DOL.

[grasmicc]

Originally Posted by wfoley

i have worked with my current company since jan of '99. i was told this past friday that i am no longer an employee. i am now a "consultant" to the company and to bill them for my net pay. it was implied that i would not be receiving a 1099. so i would be doing the same job, just being paid under the table. my first question is are they required to pay me for the 4.5 weeks of vacation that i have accrued? the second is couldn't i still get into trouble if i didn't report my earnings even though i didn't get a 1099? i am really in a hard place now because i need the money for my bills and i don't have other work lined up. but i don't want to end up getting in trouble either.

Yes, you can still get in trouble for not reporting the earnings, regardless of whether they issued a 1099. The 1099 is their responsibility, not yours.

That being said, you are significantly less likely to get CAUGHT if they don't issue a 1099.

But if you do get caught, you could end up getting charged with a couple nasty federal crimes and might do some jail time. Maybe just tell them to go ahead and file the 1099 and you'll pay the taxes?

[wfoley]

i figured as much but thank you very much for the quick replies.

[Pattymd]

First of all, if you are doing the same job with the same working conditions, you should not be an independent contractor anyway. You are an employee, just the way you were before. At least according to the IRS.

And yes, not only do you need to report the wages, even if they do not give you a 1099, but they can get in trouble from the IRS as well. Sounds like a sneaky bunch of folks who don't care whether they violates employment and IRS regulations or not. Proceed at your own risk.