I am working at a courier company in California. We'll call it "company A".
Last year, the owner of this company agreed to help another company whose business was going down. We'll call it "company B".
It was "verbally" agreed that company A would manage company B in all aspects including perform courier service, taking customers calls by using staff from both company A & B. From this, company A will pay 25% commission of company B's GROSS income to the owner of company B.
Hence, company B will recieve 75% and absorb all the cost including payroll and business expense.
The company B's customers still make check payable to company B and the manager from company B is in charge of going to the bank and spliting the 75%and 25% to each of the company accordingly.
Also the manager also work during the day at company A resposible for both company A and B.
After 9 months, Company A realized that it could no longer handle company B since the recievable and cash flow of company is bad and it's effecting company A financially.
Every month, company A would have to advance the money to pay for payroll and the recievable from company B wasn't enough to cover the cost.
So Company A has set the date that March 30 is the date to end the business relationship with company B.
My question to you is that is company A legally obligated for company B's payroll until March 30? Can the employees from company B sue company A for payroll money since they've been paid thru company A payroll for 9 months.
Can company A wait til they collect all the money from company B's customers before they start paying the remain payroll of march 30th? Also, what if after March 30th, Company B would not pay Company A the 75% as it was agreed, what would be company A's option.
It is likely that company B would take the money and run since they will not be relying on company A anymore and company B has alot of debtors and law suits pending after it.
thanks in advance for your response

