Wages Overpayment

[Cheshire Cat]

I left my old job in July 2007 to take up a new job.

I then received a letter from my old employer, stating that during an audit it had appeared I had been overpaid by them over 3 years for an amount of £12,000. I wrote back and asked for a breakdown of how this was calculated, which they provided and it appears i was. I never noticed this as was always working overtime and wages were never the same and I stupidly always assumed that I had been paid the correct amounts!

I have agreed that I should pay the money back, but their solicitor has said that I have to pay this all in one lump sum by the end of January or they will take me to court and seek a Bankcruptcy order to get this money back.

Can they do this? As they paid the money over 3 years, can they just request it back in one go?

Any help on this would be appreciated.

Thanks

[patdavies]

Short answer is no.

Whilst it is their mistake, you do have to repay it. You can make a reasonable offer to repay by instalments. If it took them 36 months of overpayemnet to reach this position, then I would argue that it is perfectly reasonable to repay this by 36 monthly repayments (and before you ask, they should not be entitled to interest).

Also, you will need to look very carefully at whether this is a nett overpayment or a gross overpayment that they are claiming. They should only reclaim the nett amount (ie what went into your bank account). They need to take up the overpayment of tax and NI with HMRC (which will be interesting for the initial 2 years, as they will have signed declarations as to these).

[jansus]

I agree with the above - you have paid tax and Ni on these monies - so you need time to check your position carefully.

I think requesting immediate re-payment is unreasonable as part of the fault lies with them

A trip to CAB might be in order.

Jan

[Ell-enn]

As the others have said, you absolutely need to find out the figure minus the taxc and NI. I am surprised their solicitors are demanding the money in a lump sum by end January - seems like they are trying it on if you ask me.

Given that the overpayment was your employer's mistake and paid over three years (I find it hard to believe no-one spotted it before now!!), you should not be expected to repay it over less than 3 years (if at all).

I would recommend making an appointment with a solicitor in your area who offers a free initial consultation - you need to get the exact legal position on this.

Please let us know the advice you receive.

Kind Regards

Ell-enn

[Rooster-UK]

What the solicitors should realise is that if they took you to court, I wouldn't think that any judge in the country would try to enforce a lump sum repayment.
In fact, if you were to do an income and expenditure sheet, you might even be given a much longer period to pay it back.

Regards, Rooster.

[binkhus]

isnt there that law about repayment of an overpayment if it would place you in a finincially worse of position? you could get some or all of it written off because the mistake wasnt yours.

[advisee]

Originally Posted by Cheshire Cat

I have agreed that I should pay the money back, but their solicitor has said that I have to pay this all in one lump sum by the end of January or they will take me to court and seek a Bankcruptcy order to get this money back.

Admitting that was probably a mistake on your part, but its done now. Was this in writing?

How exactly has the mistake been done? I mean, as you stated, you worked overtime, and simply thought that the amounts were the correct overtime premiums.

I would suggest you have no further correspondence with them, and see if they go ahead and take you to court.