Court Opinion

ID: 9781500
Source: CourtListenerOpinion
Date Created: 2023-08-30 16:49:05.532344+00
Date Added: 2024-06-11T07:34:27.268665
License: Public Domain

PIEPER, J.,
concurring in part and dissenting in part.
I agree with the majority decision to affirm as to Robert Gunn and to reverse as to Timothy Gunn. However, I respectfully dissent as to Rick Joyce and would reverse the trial court’s determination that Rick Joyce is personally liable under the South Carolina Payment of Wages Act (the Act) for wages owed to Aaron Allen.8
The Act mandates that “[ejvery employer in the State shall pay all wages due.... ” S.C.Code Ann. § 41-10-40(A) (Supp. 2010). The Act defines an “employer” as “every person, firm, partnership, association, corporation, receiver, or other officer of a court of this State, the State or any political subdivision thereof, and any agent or officer of the above classes employing any person in this State.” S.C.Code Ann. § 41-10-10(1) (Supp.2010). An officer or agent of a company may be held personally liable under the Act when such person knowingly permits his or her company to violate the Act. Dumas v. InfoSafe Corp., 320 S.C. 188, 195, 463 S.E.2d 641, 645 (Ct.App. 1995).
In this case, Allen entered into an employment agreement with Pinnacle Healthcare Systems, LLC (Pinnacle), a manager-managed limited liability company organized by Robert Gunn. Rick Joyce was designated a member of Pinnacle and was involved in handling the company’s payroll and finances. *279Although Joyce’s involvement with the company’s finances provided him knowledge that Pinnacle was violating the Act by not paying Allen’s wages, as a member of the company, Joyce lacked the authority to make any decisions regarding the payment of wages. See S.C.Code Ann. § 33 — 44—404(b)(1), (2) (2006) (“[E]ach manager has equal rights in the management and conduct of the [manager-managed] company’s business ... and any matter relating to the business of the company may be exclusively decided by the manager or, if there is more than one manager, by a majority of the managers .... ”) (emphasis added).
Joyce’s lack of authority may be determined from the extent of his involvement with Pinnacle’s finances. Each pay period, Joyce would receive a fax from Pinnacle’s operating manager that designated who was to be paid and the amount of the payment. Joyce would then input the information from the fax into Pinnacle’s system so a payroll service could issue payments. Although Joyce knew how much each employee was being paid, he lacked the authority to make any decisions regarding payroll. Accordingly, I would find Joyce was not “permitting” Pinnacle to violate the Act. See Baisden v. CSC-Pa, Inc., No. 2:08-cv-01375, 2010 WL 3910193, at *7 (S.D.W.Va. October 1, 2010) (determining that a jury could find two corporate officers knowingly permitted a corporation to violate the Act because the officers “were actively involved in the day-to-day management of the corporation and regularly made determinations regarding the payment of wages and commissions”); see also In re Kouzios, No. 08-B-29463, 2011 WL 873410, at *1 (Bankr.N.D.Ill. March 11, 2011) (providing “the Illinois Wage Act makes officers and agents liable only if the officer or agent ‘actively asserted substantial control over the management and financial affairs of the corporation’ and ‘knowingly permitted] the employer to violate [the Wage Act]’ ”). Furthermore, without the authority to act on behalf of Pinnacle, Joyce is not an “agent or officer” of the company. See S.C.Code Ann. § 33-44-301(b)(l) (2006) (“A member is not an agent of the company for the purpose of its business solely by reason of being a member.”); S.C.Code Ann. § 33^44-101 cmt. (2006) (“In a manager-managed company agency authority is vested exclusively in one or more managers and not in the members.”). Therefore, I would reverse the trial court on *280this issue since Joyce was not an agent or officer who knowingly permitted Pinnacle’s violation of the Act.

. I would also note that absent a finding of personal liability under the Act, Timothy Gunn and Rick Joyce are not liable to Allen for attorney’s fees.