*snip*
-Check out his contract to make sure all is well. Will consider consulting with a lawyer, especially if there is a new contract related to a change in his role in the company
Your comment that you "can't afford a lawyer" is dangerously shortsighted. You cannot afford to not consult a lawyer, and a CPA as well. $5000 in legal fees now is chickenfeed next to a $100K payout. Put the boss on the spot-- ask her to recommend a lawyer and a CPA who will honor a fiduciary duty to you, not her.
Find a good one of each through personal references, summarize your options on a single sheet of paper, bring along the employment contract, and consult with them for their free hour. Tell them that you don't necessarily need anything but their shared wisdom or their advice on where to learn more. Be willing to pay for an hour or two of reassurance and education.
Thank you Nords, for more clearly stating what I was trying to get at.
I would also make sure to ask them about the legal liabilities of the corporation, and what he might be opening himself up to, by becoming an executive share holder/co-founder. Depending on the industry you are in, there might be a whole shwack of professional/public safety/employee safety and liability issues as well.
I'm going to tell a terrible, scary, sad story here, so please be forwarded (I doubt this is particularly applicable to this situation exactly, but I think it might be a good warning of the sorts of unexpected things that could happen):
A company that exists in the city I live in (same industry, not ever my employer), used to host large parties for their clients during our large summer fair. They would have western themed rodeo rides, and serve liquor and beer for free. Everyone in the service side of the industry had similar parties (think people get stumbling drunk sometimes, and make bad decisions, with the company trying to mitigate by paying for cabs, and having people sign waivers). One of the rodeo rides killed an employee in a rather gruesome manor, while a hundred people looked on. It was a freak mechanical failure, and the company held "Party Alcohol Liability insurance" for the event, that covered a payout of some sort to the family member of the employee, but then the company owners were left to deal with the fallout of such an unfortunate incident, with their names attached to it (occupational health and safety took them to court, and fined them to the tune of almost a half a million dollars, for which the company is liable for, as insurance doesn't cover OH&S fines. The incident happened in 2007, but the final court case and it's appeal are still not finalized as of 2 months ago).
If you can say it, it was 'lucky' that they had purchased that insurance. But then they became unable to economically purchase it for future events, and now doesn't host any sort of parties any more, because of the inability to get the PAL insurance (and because of the terrible memory of that incident).
It was truly a freak accident, which could only have been prevented by not running rides at all, but it is a possible example of liability issues that could go sideways, if the proper insurance isn't in place.
Another potential liability issue that could come back to the executives (depending on how the company is set up, if the co-founders are personally liable for the company's operations, or are shielded), is if someone gets hurt at work (or a product hurts a customer somehow), and permanently disables someone. If the insurance held by the company isn't enough to cover the disability pay-out, is the company next on the list to cover the settlement? What if the company doesn't have enough $$, or is found to be grossly negligent, do the co-founders become personally liable next?
And then there is the whole trend of employees at company events, drinking alcohol provided by the company, then driving themselves home drunk, getting into an accident, and then turning around to sue their employer for providing the alcohol, while 'allowing' them to drive after (ie, the person blaming the company, instead of taking personal responsibility for their decisions)
I am not trying to scare anyone, so I'm sorry if that's how I am coming off, but I just wanted to clarify the type of liability issues that I was vaguely referring to earlier.