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Wages Overpayment after leaving Company


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Hi Guys,

 

I hope I am in the right thread (if not can this be re-directed).

 

I recently finished employment in my previous company and left at the end of August. I received a letter today from their HR function, stating it was too late to stop this months salary going through and that I owed them 18 hours in holiday pay.

 

They went on to say, that they would be issuing a letter shortly to advise how much the overpayment is and methods how I can pay this.

 

What is the legal standings on this? Do I need to pay them back or can this be spread over a reasonable amount of time?

 

All advice very welcome.

 

Cheers

 

W

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Hi Willo

 

There are several aspects to this - mainly whether you accept that you have taken holiday over and above your accrual at the date of leaving whether you can afford to repay it. They have in effect shot themselves in the foot by not noticing before running the payroll, as they would have had the legal right to just deduct it from your wages had they not, so the ball is in your court really and they do seem to be acting reasonably at this stage.

 

If the overpayment is genuine, then yes they are entitled to reclaim it, however the means by which you pay it back is largely down to you. As an ex-employee it is a matter of a simple debt, and their only means of chasing it if you refuse to pay is to sue through the County Court. If you accept that the debt exists but are unable to just send the amount owed to them, then you make an offer of repayment in instalments which you can afford. They may disagree and threaten legal action, but ultimately you can only repay what you can afford to repay and a Court would look most unfavourably on them for taking legal action when you have made proposals for repayment (particularly if you send them a proposal and then start sending them the payments).

 

If you disagree with the amount that they want back, then you should challenge them - particularly as you will have paid tax and NI on the original payment and they may well ask for the Gross amount!

Any advice given is done so on the assumption that recipients will also take professional advice where appropriate.

 

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  • 1 month later...

Hi, I am in a similar position. I left the company about 6 months ago and had a letter a few weeks after I left from a debt collection agency claiming I owed approx £100. I wrote back with a lot of evidence to show that I didn't owe the money (bank statements, payslips, letters) because I was in fact not being paid in the right week for the full duration of working there so the dates of payment didn't tally up with the dates worked. I have since had a reply basically ignoring all of the effort I went to to prove that I don't owe them money and stating that I owe them the same amount, minus 5p!!! I am very angry at the debt being dealt with by a third party and have not had any reply from the company themselves except to say "They are sorry to hear of my complaint and that I will be contacted directly in due course by the collections agency..." I am now compiling another letter with more evidence of my complaint. Also, if my contract states that "The company reserves the right to deduct overpayment of salary from monies owing" then this doesn't mean that they have the right to reclaim money does it if I no longer work there?

 

It has now become as much a matter of principal not to pay the money because of the way they have dealt with the situation as it is about the very fact that I don't believe I owe them anything. Has anyone experience similar? Will I be taken to court for this amount? Any advice would be really appreciated.

 

Many thanks, Emma.

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Emma if you are correct and believe you do not owe this money you should make an appointment and go see your hr department in person. Expalin your findings and if you are wrong they can tell you why you are wrong and give you a better understanding of how your pay is calculated.

 

The fact a debt collection agency has been tasked to reclaim this debt suggests that this debt is an outstanding debt and you have ignored the companies requests to make arrangements to repay.

 

Emma if you owe the money then it is in your best intrests to repay or make arrangement to repay.

 

The consequences of not paying you may be taken to court, you will have court costs to pay and a judgement registered against your name.

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Thank you for the advice Colin. The problem with this company though is that they don't deal with repayments at all themselves, it was passed straight over to the collections agency without me being able to talk to them. I wrote back to the company directly and they passed it over to the agency again. It's a difficult situation but I will take this into account. I don't believe I owe them the money but in the end it seems more hassle to not pay it due to the size of the company and I would rather avoid going to court.

Regards, Verity.

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If you genuinely believe that you do not owe the money, then don't pay it - certainly not because a DCA has become involved. The DCA can do absolutely nothing except to write threatening letters - that is what they have been paid to do. You are a hell of a long way from court action on this, and remember that they will have to prove that the debt exists in order to take such action. If they can't prove it to you, and you have sufficient evidence to argue the case, then why just roll over and pay up?

 

Do not deal with the DCA - write directly to the employer, giving your assertion that they are incorrect, and telling them that you refuse to deal with anybody except them.

 

The consequences of not paying you may be taken to court, you will have court costs to pay and a judgement registered against your name.

[/Quote]

 

I really don't think there is a need to reinforce the DCA threats at this time, Colin. Legal action is some way off, and if the employer is being unreasonable, providing that the OP has a viable argument it need not come to that anyway.

Any advice given is done so on the assumption that recipients will also take professional advice where appropriate.

 

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Thank you very much for the support- I feel much more empowered now to continue fighting it. As you have suggested, I will continue writing letters directly to the company in the hope that they will listen and reply directly.

Regards, Emma.

Edited by SalaryOverpayment
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