Many employers use outside payroll services to perform the important functions of processing payroll-related data and issuing employee paychecks. Recently, in Goonewardene v. ADP, LLC, the California Supreme Court addressed the question of whether an employee can sue an outside payroll service company for errors in the employee’s pay. In that case, an employee who alleged unpaid wages, brought claims for breach of contract, negligence and negligent misrepresentation against his employer’s outside payroll service provider. Although there was no employment relationship between the payroll service and the employee for unpaid wages under the Labor Code, the employee brought his claims based on the third party beneficiary doctrine, under which an individual or entity that is not a party to a contract (i.e., the third party) may bring a breach of contract action against a party to the contract if that individual or entity establishes that it is likely to benefit from the contract, that a motivating purpose of the contracting parties is to provide a benefit to the third party, and that permitting the third party to bring its own breach of contract action against a contracting party is consistent with the objectives of the contract and the reasonable expectations of the contracting parties.