Posted by
penarth
19 yrs ago
I recently was working in the US for a large company. Upon finishing my employment I was made to sign a confidentiality agreement in return for a set amount of money. However, I did not receive the sum written in the contract as they witheld 25% of it for social security payment for the past six months. As the wording in the agreement states the employer agrees to pay employee X amount of money at the time this agreement is fully signed. From my understanding as I did not receive X amount of money this agreement is invalid. I would like to konw if my understanding is correct? There was no mention in the agreement about witholding taxes or socila security paymnets.
Thanks for your advice
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Nothing is that easy..if it were accountants would be lawyers!!!
The starting point is the exact working of the agreement.......WHERE the contract was entered into, WHERE the employment was rendered and WHAT LAW the contract is subject to,,,,,,,,,then these facts would be considered against the back ground of cases than have been decided in the courts in the jurisdiction of the contract for similar matters with your case facts in mind
Our initial view WITHOUT any of the above (not then very helpful)) is that the contract would be enforceable due to the presumption that a contract is subject to BOTH parties complying with the law (in this case the potential withhold tax).
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Mmmm "associates" is generally correct in this case, but the case is considerably simpler than what "associates" suggests:
I am just wondering, if you were working in the US and signed an employment contract for say $100 000, would you expect to be paid the full $100 000 (Gross salary), or would you expect your tax to be witheld and the company to pay you your nett salary? Similarly, it appears to me that this payment is a form of income and should be taxed accordingly and in the jurisdiction that it was paid (the US).
P.S. accountants ARE lawyers these days, "associates" - look at all the large accounting firms...
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Thank you both for your comments they are really appreciated. I was liable for my state and federal taxes and this was never witheld on a monthly basis. My employer never witheld my social security benefits which he should of throughout the year and therfore kept them from my final settlement. The wording in the contract states " Employer agrees to pay to employee as severance pay the sum of XXXX at the time this is fully signed, which sum represents X months of Employee's salary."
The amount quoted was not paid to me as my social securtiy benefits for the year were witheld from the final sum. I am therefore wondering if this agreement is valid? Thanks again
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