Wages Overpayment - Pls Help

jet77

Hi,

I was overpaid by my former employers (local authority) back in June of last year. I received an invoice for £523.50. I didn't even realise that I had been overpaid by so much as the money just disappeared in to my overdraft

I replied to the invoice by e-mail (a copy of which I can't find!) to say that I would be able to repay by £1 per month because this was all that I could afford but did not receive a reply.

I have today (6 months on) received a Final Notice through the post saying "If proceedings are issued, judgment may be obtained against you, which may cause problems with credit references in the future."

I haven't got that much money - in fact I'm just under £5k in debt and unemployed

What should I do? Please help.



PS Have posted this on the employment board too cos wasn't sure where it should go

DarkConvict

You cant stop them applying for a CCJ if you can't afford to pay.

What you can do is turn up in court if they go ahead with it, present your income/expenditure and show that the most you can pay is £1 a month. CCJs will be issued for the full debt, but on what you can afford to pay. A CCJ will reduce the chances of getting credit and good interest rates on credit for 6 years.
If possible can you start paying them the £1 now, ask for the bank details and start making payments, it goes for you in court if you have tried.
Also, keep everything in writing so you can present it to the court if asked.

planning_ahead_2

Hi

I would write to your former employer, and copy in the head of HR as well. I would explain that when you left you accepted the final salary credit as full and final settlement of your employment with them and because it included adjustments for holiday pay you could not have been expected to know whether it was correct or not - personally I would have known, but you can use this as a fairly valid reason.

I would then request a full breakdown of how the original payment was calculated and how it should correctly have been calculated so that you can clearly see how they have arrived at the figure of £523.50.

Finally, I would explain your current employment situation and offer to make a token repayment of £10 per month (which is still going to mean it will take in excess of four years to clear this overpayment) until you are in employment again, at which time you will contact them and arrange to review the monthly repayment offer.

Were you in the union whilst employed there? If you were, contact them for support. You may not be in the union now, but you would have been at the time the overpayment was made and they should support you in this.

I know an offer of £10 per month is 10 times higher than you are stating you can offer, but I think it unlikely they will accept £1 per month - but it's up to you if you want to try it. At the end of the day they are entitled to seek recovery of the overpayment. If all you can really afford is £1 per month, then be prepared to produce the paperwork in court to demonstrate this.

dan77_2

I'm never sure how people dont notice an overpayment in salary, unless they have overpaid you slighly over a long period of time. The only debt I ever managed to pay off in one go was £3279.45 to the DWP, my former employers, who suddenly gave me that much plus my usually salary in one months wage packet.

I didnt spend it and offered to pay it back straight away. I imagine your situation is different and it is for a lot less. My advice is to really try and offer more the £1 a month. Non of my creditors ever accepted £1 a month and to be honest I could't blame them. If you could do without something every month, make an inital offer of £5 before it goes to court. It is a pretty small amount and the company may decide any offer is better than going through the court process. Good luck, hope it all goes well for you.

planning_ahead_2

dan77 wrote: »

I'm never sure how people dont notice an overpayment in salary, unless they have overpaid you slighly over a long period of time.

In all fairness, the OP probably had annual leave settlement included in the final salary payment and it was probably received with the genuine belief that this was what was owed to them - as calculated by the local authority and not by the OP. Just over £500 is not a huge overpayment by any means and if they were owed a fair bit of their annual leave for the year it could have come to this sort of figure.

The reason I suggested that the OP ask for a breakdown of how the final salary was calculated is so that they can ensure the authority has paid them for all leave owing at the termination of the contract. If they can make one mistake - they might have made another and not accounted for the leave - meaning the OP may not owe some or all of the overpayment:)

Whilst salaries are computerised, the information is still input by humans and errors are made - as is clearly demonstrated by the claimed overpayment. Their error, not the OPs. I think the OP now needs to check carefully the breakdown.

DarkConvict

I've had a £1000 overpayment due to my employer giving incorrect advice, thus leading to me filling in the P46 form wrong, and thus not correctly getting tax correctly. So £500 is especially easy to miss if not in a lump sum, or as a lump sum when you leave.

dan77_2

DarkConvict wrote: »

I've had a £1000 overpayment due to my employer giving incorrect advice, thus leading to me filling in the P46 form wrong, and thus not correctly getting tax correctly. So £500 is especially easy to miss if not in a lump sum, or as a lump sum when you leave.

I wasnt having a go at the OP, I did say that if it isnt a lump sum it can be easy to miss as you say £500 is quite small, mine was huge .

DarkConvict

Sorry, i didnt mean to have a go either, just my experiences.

lolababy

Hi this happened to my partner in the end they could not claim it back as it was his line managers fault.

niccatw

As planning_ahead said, I'd contact your former employer and ask for a breakdown.

This has happened to me twice! (Good old NHS - I guess it's a fairly long payroll and I'm towards the end of the alphabet ) The first time I didn't notice as it happened the same month I'd normally receive my incremental pay-rise. The second time, I did notice - it was for substantially more money though! I couldn't belive the amount of people - in my office - that advised me too keep quiet about that one! Both amounts were immediately swallowed up into overdrafts and I would only have noticed by scrutinising me wage slip (something I learned to do religiously after the first overpayment)

Both times I paid it back slowly (although, as I still worked for them, payroll worked it out using some magical calculation and it came off my wages).

jet77

Hiya,

Thanks for all your replies.

I hadn't noticed because there was an increment increase and back pay due so I thought that was what it was.

I'm going to contact them now and will let you know what's said.

Thanks x