Apparent over paid wages

[summer30]

My husband finished a job in Feb this year, he had his final wages paid, P45 etc everything fine end of. Until today when he receives a DCA letter stating he was over paid and they want to take him to court.

 

Personally very confused as firstly wouldnt they have found out this apparent error when they did their end of year in April?

 

and isnt it their blunder so getting all you pay us by this date is a bit much?

 

Its the weekend so cant do anything about it at the minute but where does he stand ?

[honeybee13]

Hello there. Have they told your husband how the figure was calculated? That's where I would start, then you can argue if you think it's wrong.

 

HB x

[Sidewinder]

I agree with Honeybee. First of all you need to establish IF he was overpaid, and HOW.

 

How much do they claim that he owes, and was there any reason for him to believe that he was overpaid? Was he told when receiving his final salary how this was made up?

 

Providing that he genuinely would not have known this was an error, then he has an excellent defence, and in any event holds all the cards here as it is THEIR error and they must accept whatever terms he chooses to put on repayment.

[summer30]

Hi

 

They havent explained how or why it came about, its about £100 and they havent said why they think he owes it

 

theyve just gone straight for threats of you must pay

 

His payslips do have all the details of how his pay is made up, deductions etc as well nothing pointed to him owing a penny.

[orfoster]

Hi Summer,

 

Just to confirm, does he work in the public sector or private sector? Does the employer have a policy on overpayment of wages, the reason I ask is that some employers write off overpayments of around £100.

 

Something you may want to check is if you have legal expenses insurance on your house insurance policy, they may help you in this instance. Or was your husband a member of a trade union?

 

Cheers

[1stlifeline]

My son worked for a very large company and when he left he only got his last wage slip almost 2 months after leaving.

Hand on heart he did think it was more than he had expected but the wage slips are confusing at best and he had hoiloday pay and different shirt allowance and payment in lieu of notice etc, so he just accepted it.

 

Almost 3 years later they got in touch and said he was overpaid by £1248. He went to CAB and even spoke to a solicitor but he had to pay it back in instalments.

Edited June 29, 2010 by 1stlifeline

[Sidewinder]

My son worked for a very large company and when he left he only got his last wage slip almost 2 months after leaving.

Hand on heart he did think it was more than he had expected but the wage slips are confusing at best and he had hoiloday pay and different shirt allowance and payment in lieu of notice etc, so he just accepted it.

 

Almost 3 years later they got in touch and said he was overpaid by £248. He went to CAB and even spoke to a solicitor but he had to pay it back in instalments.

 

Why did he have to pay it back at all? He should have invited the former employer to sue, and then made a (very reasonable in the circumstances) argument of a change of position.

 

Where the overpayment is not the fault of the employee, he could not have known this as an overpayment (complicated nature of amounts owed, PILON, allowances, uniform etc) he had spent the money and had thereby changed his position. Particularly with a final salary payment on termination of employment it would be nigh on impossible for the employer to prove that the employee should have known that he was overpaid.

 

Back to the OP's case, the same would apply. "Sorry, believed that the final pay was correct, your mistake and I've now spent it. Sue me if you like, but only if you can prove that I should have known and pointed your mistake out to you at the time"

 

It will cost them more than it is worth to take this much further.

[Bigredbus]

Sections 13-15 of the ERA 1996 provide the right not to suffer unlawful deductions from wages. However the Act provides six exceptions from the rules, amongst which is the recovery of overpaid wages and business expenses.

 

As per a change of position, as mentioned by 'Sidewinder'... In general, the courts will hold that recovery of an overpayment, or 'restitution', is appropriate where 'unjust enrichment' occurs, but not appropriate if there has been a 'change of position', for example because 'a person receives payment in good faith and then spends it, gives it away, or loses it'. In the latter situation, it would be inequitable to require restitution.

 

In Commerzbank AG v Gareth Price-Jones [2004] 1 P & CR DG 15; [2003] EWCA Civ 1663, the Court of Appeal made the following points, among others:

 

(a) If a 'change of position' occurs, it is likely to occur after receipt of the overpayment. The change of position claimed by Mr. Price-Jones had occurred before he received the overpayment. He claimed that, if he had taken the second letter to have replaced the first letter, he would have assumed that the Bank no longer viewed him as a valued employee and would have sought alternative employment.

 

(b) However, the decision made clear that the 'change of position' defence is still available where a change of position occurs in advance of the payment. To quote the judgement: 'The question whether it would be inequitable to require restitution can arise in cases of 'anticipatory reliance' where a recipient of an overpayment has already changed his position in good faith in the expectation of receiving a future benefit'.

 

© The 'change of position' defence requires the recipient of the overpayment to establish that, in all the circumstances, it would be inequitable to require restitution. This would normally occur where the recipient can demonstrate a reduction in assets, i.e. there are no, or insufficient, funds available to make the repayment. However, examples of other situations in the context of employment where there could be a 'change of position' even though the money was still available are

• Giving up an existing job to lead a life of leisure in circumstances where it would be difficult to find another job, or
  
• Turning down a firm offer of a better paid job.
  

[summer30]

hi all sorry im late in replying, nothings happened so far but hes had a further letter from a DCA stating they will file for a CCJ

 

can they do that for overpayment of wages? it makes no sense the letter states he has this amount outstanding on his account, almost like its a loan or something.

 

shouldnt they have to prove it first?

 

 

eta to answer this is an umbrella company that would have been paid by the agent who was paid by the company he was working for.

[CornettoGospel]

If he was overpaid becuase your husband either recorded his hours wrong or something then i can understand the repayment, but if they overpaid him due to the company's own idiocy then surely he only has to pay it back as a sign of goodwill.

 

I wouldnt repay anything until theyve clearly told you (in writing of course) why you need to repay.

[summer30]

hi thanks, it cant be his hours he has to have the checked by his line manager then the agency, the umbrella company just pay him what they are told to pay minus deductions so its deffinately their error. Im unsure why they arent conversing with him though rather than a one off very rude email then threats by this DCA

[BeauBrummie]

Hi Summer30,

 

Have you written to the DCA to ask them to prove it?

 

If not suggest you do so with a warning that as far as you know your Husband owes nothing. The ball is firmly in their court to show how the overpayment (if any) was made up and occurred. All other tactics to get you to pay should be ignored as scaremongering.

 

Beau

[summer30]

Hi No havent said a word to the DCA as yet, will try that see what happens thanks

[summer30]

sorry im struggling with how to word the letter

 

Could someone help ?

 

I got this far but i think its too waffly?

 

 

With reference to your letter dated ******

****** is an accountancy company who take their fees before paying the contractor such as myself, Therefore I am concerned as to why you are saying I have an outstanding amount on an account with them.

As far as I am aware I do not owe this company anything, I finished dealings with them in the last financial year and was issued all paperwork from them with no mention of any problems.

Can you please send me full details of how this apparent amount has been calculated and any other copies of original paperwork I require proof of this amount before entering into any further correspondence with yourselves.

thanks

[Sidewinder]

You can either be as curt as you like with the DCA or ignore them altogether. The DCA is acting on the instruction of the company, so cannot take legal action themselves, so feel free to communicate only with the employer if you wish, and only in writing.

 

Therefore. To the DCA.

 

Reference xxxxx

 

Sir,

 

With regard to the correspondence which you have recently sent to me under the above reference, please note that I acknowledge no debt to either yourselves or any other company whom you claim to represent.

 

In order for me to correspond further on this matter I require written proof that any debt exists, and that you have a right to be pursuing me. In the absence of such proof, no further correspondence will be forthcoming and should you persist in sending letters to my address, I will consider such an approach contrary to the Protection from Harassment Act and will report this to the appropriate authorities. Furthermore, in failing to substantiate your claims that I owe money to your client, I consider this contrary to the Office of Fair Trading guidelines on debt collection, and will also take the appropriate action in that regard.

 

Yours faithfully,

 

Then to the employer (unbrella company, agency?)

 

Reference xxxxxx

 

Sir,

 

You have recently seen fit to employ a debt collection agency in order to reclaim an alleged, and so far unsubstantiated, overpayment of wages further to my employment which ended several months ago. You will be aware that I have previously asked for documentary evidence that any such amount is due to you, and categorically refute, in the absence of such proof, that any debt exists. My employment ended on [Date] and I have received wage slips and a P45 demonstrating all relevant payments. If, as you claim, an overpayment was made, I have never been made aware of it, nor do I believe that this was the case. I consider that I was paid correctly for the work performed and have never had cause to believe otherwise, so if an error was made, then this was entirely the fault of [Company] and I cannot be held responsible, particularly where so long a period of time has elapsed.

 

Should you continue to believe that you are entitled to reclaim any money whatsoever, I demand that you forward written evidence of this, in terms of the overpayments made, and how any overpaid Income Tax and National Insurance are accounted for within the alleged overpayment.

 

In the absence of such evidence, I will not communicate further on this matter, either with yourselves or any company employed by you to demand money or make threats of legal action. On the latter point, it is my intention to report [DCA Name] to the relevant authorities for breaches of the OFT Code of Practice, and if necessary under the Protection from Harassment Act due to the nature of the threats made against me, and I will also condider yourselves responsible as the instigators of such threats. Please also note that on the subject of legal action, any attempt to do so for this unsubstantiated claim will be vigorously defended.

 

Yours faithfully,

 

Whi is the DCA by the way?

[summer30]

thanks for that, DCA is a company called LRC legal recoveries and collections

[Sidewinder]

thanks for that, DCA is a company called LRC legal recoveries and collections

 

Waffle in order to add menace to the employer's claim then...

[summer30]

ahhhh

 

I actually emailed the company last night asking again for details in writing

 

got a call this morning from them but missed it just a voicemail asking to call them back, but my husband really wants their reply in writing and wont ring them back

 

is it worth him calling them seeing as theyve now bothered to reply or should we demand it all in writing from now on?

[summer30]

ohhhhh it gets better

got a snotty email saying its in relation to overtime paid, my husband did not work any overtime

 

they have said we should only converse with the DCA and not them what rot

[BeauBrummie]

Hi Summer30,

 

Did you write to the DCA as Sidewinder as suggeted ? Still believe this is your best course of action. Even more so now that the ex employer would only like you to converse in this way.

 

The DCA can jump up and down, scream and shout but they cannot actually DO anything until they prove the alleged overpayment.

 

Beau

[summer30]

thanks all for help so far

 

Ive got letter ready for DCA

 

replied to the umbrella company, they are saying its an error by the agency that paid them and that my husband was overpaid overtime, however he never worked overtime or claimed it?!

 

they say they have sent out email evidence but to an old email we havent used for a long time, so have requested now for a 3rd time the evidence

 

is it any coincidence this afternoon calls from the DCA have started

Edited July 22, 2010 by summer30

[Sidewinder]

thanks all for help so far

 

Ive got letter ready for DCA

 

replied to the umbrella company, they are saying its an error by the agency that paid them and that my husband was overpaid overtime, however he never worked overtime or claimed it?!

 

they say they have sent out email evidence but to an old email we havent used for a long time, so have requested now for a 3rd time the evidence

 

is it any coincidence this afternoon calls from the DCA have started

 

Get the DCA letter sent off. Don't talk to them on the phone unless you are prepared to be very rude and thick skinned. A simple 'prove it in writing' then 'bye bye' is as much as you need to say. You are under no obligation to deal with the DCA but if that is the way the company want it, then you have already said that you won't talk to them until you see evidence, so ignore everything else. You have made a reasonable request and it is up to them to provide what you have asked for.

[summer30]

Thank you again for helping on this

 

got a copy of a letter emailed today from the umbrella company, (which they say theysent previously we never received it) it states that my husband was paid overtime rate in January for 2 weeks when in fact he shouldnt have been and this was done by the agency who pay the umbrella company

 

However they have just sent a letter outlining this, no actual proof and again they are stipulating their terms as in pay us within 7 days or else

 

Its the error of the agency so why is the umbrella company chasing it, I am assuming its because they pay them and they must have refunded the agency , not quite sure how these things work

 

at the end of the day the agency is the one in the wrong?

[summer30]

anyone? is a letter outlining the issue enough or shouldnt they be providing the actual details, not just something saying "yes we accounted for this amount, and such and such says they made a mistake" ?

 

can post a copy of the letter if it helps

[caledfwlch]

I wonder how willing the umbrella company would be to go to court, and have its payslips etc subjected to scrutiny.

 

I worked for an agency that used an umbrella company, and the pay slips were complete farces, because they were using all sorts of dodgy loopholes to benefit themselves via tax and NI.

 

Do your payslips actually seperate between "normal" hours worked, and overtime etc?

 

If they are anything like the ones I had, then it would be incredibly difficult to notice if there was an overpayment, especially since those umbrella companies advertise themselves on the basis that your Pay will be higher under their system, than if you were a PAYE employee. I suspect a defence could be had there