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OT - Well I fell for the Rent to own scheme machine shop style

kpotter

Diamond
Joined
Apr 30, 2001
Location
tucson arizona usa
The same thing happened to a guy who came to my shop today looking for a job. He was told that he would get 20 % equity in the shop once it was up and running and making a profit. He worked for 5 years and got dick. I know the shop and I know they lost 5 people this week because they didnt honor the promise. I wouldnt go into business with anyone it is too hard.
 

alonzo83

Stainless
Joined
Mar 20, 2013
Location
Missouri
I had a out of control boss before. I am sorry, they don't give very good recommendations.

Hope you can find a boss more interested in your results 2-4 weeks after hire than with being interested what you have had to deal with in the past.

Regards
 

PDW

Diamond
Joined
Jul 24, 2006
Location
Australia (Hobart)
I went through this 15+ years ago. Cost me 3 months & $30K in unpaid invoices. At that point I walked. I don't believe in promises. I used the software I'd developed in another project that did pay. Still a lesson I only needed to learn once.

Claiming back pay is the best thing to do now. If there's nothing in writing saying the OP is a part owner and salaried employee, just how was he getting paid? Could be very fertile ground for claiming lost wages there. But - better have a good record of hours worked etc.

Upside is the same as the one I had. If there's no enforceable contract in place, you are free to do whatever you please with the knowledge that you have, including embarking on a business opportunity of your own, targeting all those people that you know need services, and exactly what services they need.

Good luck with it, it's an expensive lesson but you're not Robinson Crusoe here....

PDW
 

ewlsey

Diamond
Joined
Jul 14, 2009
Location
Peoria, IL
You didn't learn anything from Orange County Choppers?

Kid works for the old man. Gets a share of the company. Old man fires him. Old man tries to undervalue the kid's shares. Kid refuses to sell his shares back to the old man.

Only the lawyers make out in a deal like this.


Personally, I have seen this happen a few times, and been offered the deal myself. No thanks. If you want to be a company owner, start your own company. Don't wait from someone to give it to you.


I saw it happen at a foundry in town. All the key employees were promised a stake in the company. These guys had 20+ years in, and still no ownership. The owner hires a new general manager from outside to run the place. That didn't go over well.

The employees jumped ship to another foundry that actually gave them an ownership stake.

Now the kicker. All those guys swore the old foundry "couldn't make it without us". Self delusion.


Buy some machines. Put the old boss through hell. You burned the bridge anyway.
 

david n

Diamond
Joined
Apr 13, 2007
Location
Pillager, MN
Take the customer list and run with it. Lathe and mill. Work 72 hrs a week for yourself. If you can't swing a shop on your own, play salesman and "sell" those customers to another shop.
 

Clive Hugh

Cast Iron
Joined
May 13, 2007
Location
Bunbury Western Australia
I worked for a real dick once.......not the same as your situation.....however......after finally having enough of his emotional bull shit, telling everyone they sucked and how stupid we all were......constant screaming and tantrums I quit.....God that felt good. I had gotten to the point of having dreams about killing him, and would wake up smiling and happy RED FLAG lol.....any how...the next thing I did was after establishing myself as competent at the new shop I went to HR and asked if we were looking for any good machinist'. retribution #1 I was told absolutely yes. I called 3 of my buddies from the old place and long story less long......all 3 got hired. 3 of the 4 of us have been there for 20+ years now......retribution #2.....I have since worked my way into a position where I occasionally get consulted with some of the work we "job out" I have had the distinct privilege to explain to 3 different engineers why they should not award the contract to my former employer even though he was the most competitive bid. We job out quite a bit of work in our area.....he....will never win one bid so long as I have any influence. I only wish he knew why.......I later found out there are other guys at my current employer who also weathered the storm.

I read once "revenge is a dish best served cold" enjoy it.
 

Trboatworks

Diamond
Joined
Oct 23, 2010
Location
Maryland- USA
I did the same sort of thing but provided the rope, tree and even tied the noose myself.

I worked for the nicest guy in the world who had a small company and was trying to make it while struggling with a young family.

I ran all the jobs and managed the crews for him for about ten years.
If he couldn't make payroll I told him to get pay the guys first and we would make good in good time.

Its funny how things can go- I worried about getting the jobs done and worked like a dog.
A real working fool- pay or not.

In the end I was moving on and just wrote it all off.
Probably not too much cash say 40- 60k or so over those years of missed pay.

No regrets but these days I try to make sure I am mostly getting paid for work.
It mostly works out that way LOL.
 

adama

Diamond
Joined
Dec 28, 2004
Location
uk
You done well not to hit him, i know i would have done, its the one thing my past has taught me, there comes a point were snapping is far better than holding the rage + stress in, comes a point you have to let it out. There comes a point that you have to stand up for your self, it may not go well, but you have to decide what it means to constantly get trodden on. IMHO your story crossed that threshold, he would have been on the floor when i left that office after a lot less than 3 hours.

As to what to do, you were clearly high up and have the skills, IMHO if you want to really grow a pair, set-up and do what you were but for yourself, you clearly know how if you were a key part in that 50%+ annual growth rate. But to do that you have to stop being a victim and become a bit more of the ass hole (key is only to be the ass hole a little bit!). After my previous - last employer openly screwed every member of the company out of there bonuses by blowing that years profit setting up the polish show room (like 1.5 million on a small office space) i honestly had no quarms about dealing and working directly for the customers doing exactly the same as i was for them. You were promised a 10+ % stake, so go after that much of the work :-)

As a emplyee you buy my loyalty, screw me over though and i will return the favour, be loyal look after me, and i will happily do anything and be loyal in return.

As the above posts state, this kinda bait and switch is common in the small business game, you need to try and always be foreseeing te next move. Above all make contacts every were you go. A big part of my self employment income is very much work i still get through my contacts, good contacts don't need previous employers references, they already know you! They know what you can do and if your reliable.
 

KB3AHE

Stainless
Joined
Jul 17, 2012
Location
Baltimore, Md.
I think most of us have fallen into a pit like this at one time or another. I'm no exception.

I had worked for the same family owned company for 25 years. I was basically the backbone of the company and wore many hats. Estimator, project manager, fabricator when needed, forklift mechanic, electrician, and...........$2mil/year salesman! ! ! I had always been underpaid but the family environment, bennys, and the fact that it paid my bills with a little left over kept me there. It was a nice place to work. The owner and his wife had promised and assured me (verbally) that as long as the company exists and I want to work, I will always have a job there. after 25 years we were more like family. They had even had me sign papers that I would take over as an officer of the company in the event of his demise!

Enter the villain........... As the owner is getting up in age, he hired a new guy to take over as GM. (No, this is not sour grapes because it wasn't me.)
The new GM and me did not agree on a lot of issues, to the point of a few shouting matches. But at that time the owner had made me somewhat untouchable, because he knew I always looked out for his best interest. (and never got paid for it) Also hiring a GM left me free to do the other things I did best. (like sell jobs) Well................ some time elapsed and my liver disease turned into liver cancer. When I let them know of my diagnosis, the new GM siezed the opportunity and shitcanned me. The owner couldn't face me but he reluctantly went along with it. This was all verbal in a closed door meeting (ambush if you will). The new GM actually told me that they were terminating me because I have cancer.

After all of the years and all of the 50-60 hour weeks I put in and never got paid for the overtime (salaried employee) I was left standing there with my dick in my hand! It was not a good feeling. Previously the owner had promised me a stake in the company when he finally retired. But, you know what.............. promises arent worth the air they come out on. They stuck it so far up my ass that I'm still finding pieces of it.

The moral of the story is: Get everything in writing or get ready to get fucked! ! !

Frank
 

Heavey Metal

Banned
Joined
May 10, 2011
Location
Texas
When a man is angry he is ate up with fear.

Fear he is going to loose his pussey, his money, or his status in society.

All 3 of these are reality after a divorce.

What you need to do is stand up on your hind legs and get a hold of the recieveables explaneing to mr angry that wifey wont get half of your share.

If you want to stay in business you will learn that an angry man is the easiest to gain on (they cant think strait when mad)
 

motion guru

Diamond
Joined
Dec 8, 2003
Location
Yacolt, WA
I have a partner now who owns 1/3 of the company. He quit a $100k/year job to join me in a rented garage working salary at $30k / year and all the OT he could muster. 2 years in, I doubled his salary and made good on a 10% stake and I started taking a living wage so I could move out of my in-law's house. A few years later, increased him to 25% and then again a few more years down the road we bought a building together with another employee.

In my mind, it is clearly an issue of being obsessed with power or money or control (or some combination of the three) that would cause someone to make empty promises like that. As a business owner, if what you have is what anchors you . . . then your business really owns you and you will commit all manner of wrong to others to preserve your (power, money, control) . . .
 

Philabuster

Diamond
Joined
Jul 12, 2006
Location
Tempe, AZ
When I started I was taking over the programming dept as they still didn't have a full time programmer and so I came from another shop after 2 1/2 years there. I was pretty excited as I have always dreamed of having my own shop and this oportunity looked like a good start to that path as like I said I was promissed a piece of the pie, having it be always up to discussion on different numbers from 10% of the bussiness. So with this promise and 2 other ''partners'' with one at 10% and another one at 20% of the shares, I felt like a happy camper to have found such a great deal.

As a few others have asked, what exactly did you do or purchase in order to get promised a piece of the 'pie'? What did the other owners do or purchase and get on paper?

I see you put in a shitload of free time as a salaried employee and ran stuff as a general manager, but I did not see you purchasing machines or other assets. Yes, you got screwed by chasing the plastic carrot. Lots of people here have fallen for that bullshit as you have read.

I did see you handled the confrontation very well by repeating the same phrase over and over again in a calm manner: "Go home." That tells me a lot about you and it will also tell your future employer you can stay calm under MAJOR pressure. Most interviews nowdays are mainly BEHAVIORAL INTERVIEWS, meaning they focus very little on the skills questions and concentrate on how you will react during certain situations. Your entire story substantiates you can handle a lot of bullshit and still perform your job. Problem is your direct boss/owner was the one dishing out the shit.

The one thing I do see is that you are from TEXAS. Texas has some really weird laws regarding verbal contracts and promises, which you should investigate.

Years ago, my uncle (40 years old, been divorced once already) promised he was going to marry a woman, but things did not work out between them and they never got married. She sued him for breach of contract and ended up getting half his shit as if they were married. LOL. I thought this story was bullshit the first time I heard it.
 

Mmtz

Aluminum
Joined
Apr 24, 2012
Location
San Carlos, MX
Second: Nothing like a divorce to screw a good man up. It can turn the best of them into complete maniacs.
It should always be a warning that your boss or co-worker is going to go off the deep end for a year or two no matter how much they claim otherwise.
"Oh, I'm fine with it", "This is the best thing for me"............ yea, right.
Bob

Agreed, I truly want to believe it's this whole mess going on in his personal life that's making him go all nuts and I really mean that. I actually waited 5 months while he was going thru all this mess and wasn't even coming in to work before I even talked to him about it, since for starters while he was going thru the divorce, legally his wife was still 40% owner of the company (I guess I forgot to say one of the other partners who has been there from day one and actually is the VP knowing nothing but how to run a CNC lathe, no programming, no troubleshooting, nothing) does in fact have a 20% equity on
paper.

On the other hand he also royally screwed his ex, treatened her of working with him wihtout lawyers or he would do his best to leave her on the street, so he left her the still not payed for $1/2M house, her SUV and the kids and he kept the shop, fully payed beach house and another pc of land on the beach on the verbal promise that he would support her, keep it all civilized for the kids sake and would even pay her expenses on the big house since he didn't want his kids to suffer.

Needless to say his ex has also been showing up to the shop and making scenes with him on the parking lot. Turns out he accepts he told her he would payed her expenses but has changed his mind and just told her to get a boyfriend to pitch in for her umm ''company''. It also looks like she is gonna be loosing that big house before the end of the year as she can't keep it up on a medical assistant paycheck.

Meanwhile I was the only one on the shop who never saw the sexy pics and texts his new 23 year old (he is 44) GF sends him, because yes, I told him he shouldn't be showing those.
 

Mmtz

Aluminum
Joined
Apr 24, 2012
Location
San Carlos, MX
"go away" money. LOL You wont get squatt.... were you paid overtime for those, what were they 72 hr weeeks??..... my guess is no..
Were you given ANYTHING on paper prior to falling like a sucker for this so called oportunity???? again my is guess no...

By the way... you said it was a "rent to own" situation.... WHAT EXACTY was the "Rent" you paid??

Forgit about them, dust yourself off and go get a REAL J O B


My feeling exactly. I never got anything on paper, nothing at all. I worked my ass off as a salaried employee only on the promisse of a future payout.

No rent ever payed, I meant to use the phrase as an analogy with that the whole situation turned out like the ''Rent to Own'' scheme plans when buying a house. You pay a rent, normally over regular rent value for the house and part of said payment goes into a fund deemed as a down payment at the end of the lease agreement. Biggest drawback for renters was when they found a crock that would behave perfect for the first 3 years of a 4 year contract, by that time most renters had already fell for the idea that the house is actually theirs and it was really easy for a crock to found a way on which they had breach the contract to cancel the whole thing but still keep the house and the money put in for the down payment...

So bottom line the house or shop is ''yours'' just as long as you keep on smiling to the landlord to keep him happy...
 

Mmtz

Aluminum
Joined
Apr 24, 2012
Location
San Carlos, MX
Is the shop actually making any money? Anything worth taking?

A verbal contract is still a contract. It might well be worth talking to a lawyer. You may be able to get some "go away" money. Or at least cause him some hassle.

It's making money alright, having money on the bank and most machines paid for already, along with a real solid line of credit.

We were on the middle of doubling up the floor space and form all the machines we are talking of all good shape machines along with 3 brand new lathes and brand new WEDM.

So yes, there is a lot worth taking. I just don't think getting into that kind of matters at my age would be a good move, I wouldn't like that shadow to haunt me forever when looking for a nother job. I might as well learn from it, dust it off and start all over somewhere else.
 

Mmtz

Aluminum
Joined
Apr 24, 2012
Location
San Carlos, MX
You didn't learn anything from Orange County Choppers?

Never liked the show, I couldn't put up with all the drama ;)

I saw it happen at a foundry in town. All the key employees were promised a stake in the company. These guys had 20+ years in, and still no ownership. The owner hires a new general manager from outside to run the place. That didn't go over well.

The employees jumped ship to another foundry that actually gave them an ownership stake.

Now the kicker. All those guys swore the old foundry "couldn't make it without us". Self delusion.

Not the case here though I know they'll make it. We can all be replaced somehow and that will be my case. The only regret I have about this is having just stood there as I was told to do instead of fighting back as I wanted to. At least I would have left some frustration out.
 

Comatose

Titanium
Joined
Feb 25, 2005
Location
Akron, OH
What would haunt you? This is not you suing a former employer. That haunts careers. This us you suing a former business partner. That's just something that happens between gentlemen when one tries to f*ck the other.
 








 
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