Overpayment of wages

[gyzmo]

About 6 years ago person X left company Z. It transpired a month or so later that there had been an overpayment of some £900 in wages, which X agreed to pay back in monthly installments of £10. Although there is still a couple of hundred left to pay, Would X be able to stop making payments on basis of Limitation Act or for any other reason?

[gyzmo]

sorry - the amount owing was originally £1020.

[Goldlady]

Hi gyzmo, if the payments have still been made the Limitation Act would not apply as far as I know. It could be that if there is not much left outstanding the former employer might be happy to call it a day. Did they get a CCJ or was it just an informal arrangement?

[gyzmo]

I am not aware of a CCJ - x stated that she simply called the payroll dept and agreed a figure of £10 / month and has left it since. She is now thinking about it and reckons that she should not have paid it at all as she did not seek any advice (she was unemployed or a few months).

[Goldlady]

Well she could stop paying it and see what happens. If they chase it she could say she thought it was fully repaid.

[Weird Al Yankovic]

If she has/is been paying an agreement to repay money overpaid by her ex-employers then I'd guess it is a valid agreement and needs to be complied with otherwise she could be in breach of it if she stops.

Is the agreement in writing?

If not, and it was a verbal agreement to repay, then this is a valid agreement too but, obviously, harder to prove the detail.

Did the employer send other letters, documents etc detailing the money overpaid?

[gyzmo]

Not that I'm aware of. In answer to Goldlady, X doesn't want to risk just stopping the payments.

I do not believe that there is an agreement in writing - only a couple of letters saying that the money is owed and to call the payroll office to make arrangements. Think I'll direct her to CAB - maybe they can negotiate on her behalf.

[weegirl]

Even if this was the company's fault, they do have a right to ask for this money back in installments that are affordable. The only way that you can get off with an overpayment is to argue firstly that you didn't know you weren't entitled to it and that you used this money to obtain HP or something similar, therefore proving that to pay it back would impinge on your current financial circumstances.

By already agreeing to start paying, it will be very difficult now to do this. The fact that she has made some payments to this shows that she agrees that she owes the money. She will have a very hard time proving that she shouldn't or can't pay £10 a month, it is not a large amount. I'm all for staff rights, but to be fair I think the company has been very reasonable accepting such a small amount.

[gyzmo]

I do agree with that - It's really a case of wanting to pay less than agreed (think she's hit on hard times) - at least for a while. But still - if she could get out of it......