Been Overpaid - Now they want it back

[hast2]

Hi, I'm hoping someone might have had some experience of this and give me a bit of a steer on how to best proceed with this.

I've just been told by my employer that they have been overpaying me for the past 7 months, (including my yearly bonus) and now they want the 4 figure sum back.

This all appears to have happened when I took on a new role, within the company, that paid slightly less money. (my choice as I didn't enjoy the previous role) I remember checking my wages via my bank statement and seeing the change in amount, but now that all this has come to light and I've gone in and looked at my online wage slips, it appears that that change was because they messed up my pension contributions (checking all my payslips shows this to have been corrected now)

It appears that when I changed role they never actually changed my wages.

Can they just take it back? their suggesting over about 3 months.

[hashtag]

It is their money not yours.

I suppose you could refuse and collect your P45 on your way home.

[craigjm]

They have a right to take it back and it would be unlawful for you to refuse. However, they can't just take it out of your salary without your permission as this would be an unlawful deduction from salary. You need to come to an agreement with them as to the term in which you repay it. Three months is fine but you could ask to repay it over the 7 months or so ahead based on the fact it's been happening for that long.

Bottom line is they have every right to recover it and you can't keep it

[anothernameitist]

their money. can you afford to pay back in 3 months

If not make them an offer.

[B17NNS]

I'd counter and ask to repay it over 7 months.

[jesta1865]

i looked into this as I just had it with my previous employer.

they can ask for it back, but they need to negotiate with you an acceptable time period to pay it back.

mine was slightly different as i was changing companies.

handed my notice in back in march, told them my end date as I had worked it out.

10 days later they confirmed it, and said they accepted my resignation (kind of tough if they didn't ).

asked about pay, told would be paid for the amount up to the end date (as expected)

got paid, slightly less as I wasn't doing a full month, so all good i thought.

2 days before I leave they email me and say they made a mistake, i owe them £350 back. So I question why when I had a reduced amount anyway, and they said I put my resignation in late, pointed out that HR had sat on it, not me.

So I am still waiting on any sort of contact from them, especially as they paid me again last month

I've stuck it all in a savings account for now.

They wondered why I wanted to leave

[PurpleTurtle]

Although entitled to the money back, it's their mistake - and they should be reasonable in allowing you to repay their mistake.

I'd be asking for the full seven months. Explain that you've spent it and will have to go short to repay what is, I repeat, their mistake.

[AyBee]

craigjm said:

They have a right to take it back and it would be unlawful for you to refuse. However, they can't just take it out of your salary without your permission as this would be an unlawful deduction from salary. You need to come to an agreement with them as to the term in which you repay it. Three months is fine but you could ask to repay it over the 7 months or so ahead based on the fact it's been happening for that long.

Bottom line is they have every right to recover it and you can't keep it

This!

[hast2]

Thanks folks for the feedback.

I get that it's their money and to degree that they are entitled to it back, but they way they are handling it isn't sitting very well with me.

The reason I wasn't enjoying my last role and decided to move posts was because of mistakes and the poor performance of others around me that was never being dealt with, but I was getting dragged into, causing me untold amounts of hassle and making me look bad. Therefore the pay cut to start with isn't sitting very well with me (although it was my choice to escape a bad situation)

I've had issues with pay before, and had to fight with them on a weekly basis for several months to get it corrected - now it feels like because they have messed up, I'm just supposed to be pushed about and do as I'm told.

When I first got told their was a problem it was 5 minutes before the end of the week, and the following week all the managers that could deal with it were on holiday. I got the feeling, from the way the conversation went, they had known about it for several days. They only told me at the last minute because they knew I wouldn't be happy and put up some resistance.

[The Leaper]

The law is pretty clear on this type of error.

1. You are not entitled to keep the proceeds of the error
2. Your employer is entitled to recover their overpayment from you.
3. It is reasonable for the repayment period to be the same as the period that the overpayments were made. So, in your case it seems that the repayment period should be 7 months.
4. Your employer is not entitled to automatically deduct their overpayments from your pay. They must obtain your written agreement to do so. Ideally, you need to sign a formal agreement with your employer.
5. If you have suffered distress and inconvenience as a result of your employer's maladministration you are entitled to seek financial compensation from them to them your D & I.

There is also the matter of your inco0me tax being over paid and the need to adjust this retrospectively. As the overpayments probably involve the two tax years 2016/7 and 2017/8 the problem is a bit complex. I would expect your employer to deal with HMRC and get your tax affairs put right promptly .

R.

[AyBee]

hast2 said:

Thanks folks for the feedback.

I get that it's their money and to degree that they are entitled to it back, but they way they are handling it isn't sitting very well with me.

The reason I wasn't enjoying my last role and decided to move posts was because of mistakes and the poor performance of others around me that was never being dealt with, but I was getting dragged into, causing me untold amounts of hassle and making me look bad. Therefore the pay cut to start with isn't sitting very well with me (although it was my choice to escape a bad situation)

I've had issues with pay before, and had to fight with them on a weekly basis for several months to get it corrected - now it feels like because they have messed up, I'm just supposed to be pushed about and do as I'm told.

When I first got told their was a problem it was 5 minutes before the end of the week, and the following week all the managers that could deal with it were on holiday. I got the feeling, from the way the conversation went, they had known about it for several days. They only told me at the last minute because they knew I wouldn't be happy and put up some resistance.

You took a new role, you knew you would be paid less for said new role, you agreed to this, you noticed you were being overpaid and didn't say anything/look into it...it's their money, the only negotiation is the period over which you pay it back.

[V12 Virgin]

Agree on all the above- it's their money and so they can ask for it back. If you refuse and decide that you want to keep it, you could be convicted of theft and/or fired. My advice would be to pay it back over an agreed timescale before it gets any worse. If you're that unhappy with your company, leave and find a new job!

[21TonyK]

Sorry to but in...

Is there a specific time period in which an employer must reclaim overpayments? Say within 12 months? Especially if not still the persons employer?

[hornetrider]

hast2 said:

I get that it's their money and to degree that they are entitled to it back, but they way they are handling it isn't sitting very well with me.

To a degree?! Er, no. Negotiate a longer pay back period, that's all you can do. It IS their money and they are entitled to claim it back.

[craigjm]

21TonyK said:

Sorry to but in...

Is there a specific time period in which an employer must reclaim overpayments? Say within 12 months? Especially if not still the persons employer?

No there isn't. There have been cases of people being written to a number of years after the incident because accounts have been closely audited

[HRL]

Suggest 12 months instead of 7 if it's going to make it easier for you?

After all, it was their balls up, not yours. Although as someone else already pointed out, it does sound like you were aware of the situation and were hoping that they just wouldn't notice...

[hast2]

The Leaper said:

The law is pretty clear on this type of error.

1. You are not entitled to keep the proceeds of the error
2. Your employer is entitled to recover their overpayment from you.
3. It is reasonable for the repayment period to be the same as the period that the overpayments were made. So, in your case it seems that the repayment period should be 7 months.
4. Your employer is not entitled to automatically deduct their overpayments from your pay. They must obtain your written agreement to do so. Ideally, you need to sign a formal agreement with your employer.
5. If you have suffered distress and inconvenience as a result of your employer's maladministration you are entitled to seek financial compensation from them to them your D & I.

There is also the matter of your inco0me tax being over paid and the need to adjust this retrospectively. As the overpayments probably involve the two tax years 2016/7 and 2017/8 the problem is a bit complex. I would expect your employer to deal with HMRC and get your tax affairs put right promptly .

R.

Thanks for the input.

I genuinely didn't know I had been overpaid. When I changed jobs I looked for the drop in pay on my bank statement and sure enough I had a drop in wages from the previous month. Now going back over it all, it appears that the difference was because my pension contributions had been all cocked up and then extra taken to rectify it, hence the difference I seen.

I had thought about the tax implications and I think I'll get them to look into it before I agree to anything.

I know it's there money and they should get it back, but they've not exactly handled it well. You would expect a meeting along the lines of, we're very sorry, can we work together to resolve this. Not - Hast2, we didn't adjust your wages when you changed positions last year and we're going to take it back, if you have any questions they'll be no one here to discuss it (last bit was implied, by the fact the all left on business trips or holiday, not actually said)

Would love to just up and leave, but I'm in a specialist job and the market around here is also pretty slow at the moment so a career change isn't an option either.

[craigjm]

I had thought about the tax implications and I think I'll get them to look into it before I agree to anything.

[/quote]

Assuming you are paid through the main payroll and PAYE then the tax situation will resolve itself as the deductions will be done pre-tax

[hast2]

craigjm said:

I had thought about the tax implications and I think I'll get them to look into it before I agree to anything.

Assuming you are paid through the main payroll and PAYE then the tax situation will resolve itself as the deductions will be done pre-tax

I need to look at it in more detail, because it's split across 2 tax years, what if it has put me into different tax brackets, and I've been over paid at the upper tax rate, but pay it back at the lower tax rate, I'll be refunded less tax? Is that correct?

[Gary C]

Something similar happened to me. They overpaid something (can't actually remember what now, it was 1989 and in a nationalised industry you got additional payments for so many things it was hard to keep track) then just took it out of that month salary all in one go. Fortunately I had some overtime due that month otherwise I would actually have had a zero pay packet as the amount was slightly more than my monthly salary)

Was really not happy with the personnel department that day.

At least they haven't done that to you.