I hired this lady to help me start with a project in Indonesia 2 years ago. I paid her what she asked and mentioned some profit/revenue sharing schema as a bonus if things work out. She was first employee/contractor. She contracted local companies to work with us.

After a year working with her started to be difficult. I told her I'm replacing her with someone else. I was surprised she took it lightly. And then after two years (now) she is threatening me to report me to local authorities for exploiting locals ("her") because she considers herself as a co-founder of the company. This is classical miscommunication and is my fault for sure. However, I don't feel any obligation to pay her anything. I'm willing to pay her small bonus out of my own pocket for said miscommunication but she’s asking for 8 times more than that. I would like to handle this in a nice way and learn a lesson here. I don't think said reporting to authorities would have any impact on me and my life as I don't live and want to go to Indonesia, but if she would be creative she can hurt the business in other ways. I don’t want any bad blood and now the project have more stakeholder so, I want to make it sustainable business and I definitely shouldn't put it in any danger.

Any ideas how should I handle this?

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    You need to talk to a lawyer. Putting your business in the hands of advice you get from strangers on the internet isn't a great idea. – Kathy Jul 18 '19 at 13:49
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    Also be carefull with the "classical miscommunication", she might be trying to manipulate you when it is crystal clear in the contract that she has always been an employee. – Walfrat Jul 18 '19 at 13:54
  • So you started a project/business in Indonesia and worked with her for a year and you don't live or plan to go there? So you did that all remotely? – iLuvLogix Jul 18 '19 at 13:59
  • @iLuvLogix yes, it's online business.. – vmachacek Jul 18 '19 at 14:04
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    I hope you didn't admit officially that "This is classical miscommunication and is my fault for sure, I'm willing to pay her small bonus out of my own pocket for said miscommunication" because it sounds that you admit doing something wrong. – Bebs Jul 18 '19 at 14:10

Any ideas how should I handle this?

Unless she has some sort of legal claim, essentially a contract that grants her XXXXXX, you should completely ignore this. Do not respond to her further.

If she goes through the expense of obtaining legal council, then and only then, engage a lawyer on your behalf.

Also, paying her when you don't have to might make you seem guilty when in fact you're really not guilty of anything.

Unless you gave her something in writing (or email) granting her ownership or promising her a bonus, ignore her and focus on growing your business. To me it seems she is attempting to take advantage of your good nature.

NOTE: Going forward, make sure you have a contract in place with anyone doing work for you, clearly stating what the terms and conditions are.

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    Though the question is not really well asked regarding our guidelines, that answer make it totally fine by me. Specially the advice to not go to a lawyer when it is not yet necessary. – Walfrat Jul 18 '19 at 14:32
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    I also am glad it's not another answer screaming "go to a lawyer". – Gregory Currie Jul 18 '19 at 15:05
  • I agree with this answer. What I would say is, while you are ignoring all correspondence, I would still keep a record of all of it. You never know what may be handy should things go south. – Gregory Currie Jul 18 '19 at 15:07

"I hired this lady to help me start with a project" .... "she considers herself as a co-founder of the company"

Well that's solved then. As co-founder she has access to the bank accounts and can pay herself whatever your Board of Directors will allow.

"I'm willing to pay her small bonus out of my own pocket" ... ok, but did you really make a mistake? Being willing to pay the bonus is exactly the evidence she needs that she's worth far more.

Sorry but don't pay her anything. This is a situation where being nice is not the right course.

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