Redundancy Overpayment

moggy101

I am looking for a bit of advice regarding a redundancy overpayment. I worked for the local goverment for approximately 6.5 years before being made redundant. I was issued with a letter whilst on maternity leave estimating that I would be entitled to over £4000 in redundancy money. I When I returned to work I came back as a part time employee. I was never updated with a new figure even after repeated attempts to contact the person dealing with my redundancy. I therefore assumed that the amount had therefore not changed. After a few months of being back at work our department closed and our redundancy pay was paid out a month after redundancy. They paid me roughly the same figure as estimated in their letter. I therefore had no reason to question this figure and have spent the money. I am currently still unemployed and have now been sent a letter requesting for a large portion of this money to be repaid! This has really stressed me out and I am by no means able to come up with this money as I am currently unemployed. I also feel that they mislead me to believe this was what I was entitled to and feel it unfair to pay it back. Where do I stand legally? I should also mention I am now living abroad due to family circumstances.

SarEl

The basic position is that you do owe this money and the employer may reclaim it at any point over six years. You may be able to argue that you had no reason to know that the amount due to you had changed from that notified to you, that you therefore spent the money in good faith, and are still unemployed and unable to repay the amount. They may decide to let it go - or they may agree to nominal payments until you can get back on your feet. There may be a temptation to forget it since you are living aboard - don't do that, because they can get a court order against you and property, and they have a long time in which they could enforce it if you ever return!

I have to emphasise that the chances of them and/or a court letting you off on this debt based on the argument above are not guaranteed - in general such an argument only wins in rare cases (and there is more chance of the employer accepting it than a court, although a court may accept it - but it's best not to test it out in court if avoidable).

getmore4less

Were you encouraged to go part time on return or did you ask for the reduced hours.

Another angle to add might be,

Since they had started the redundancy process and it is fairly common for these things to drag out a long time in local goverment, not sure if you could put a case that they should have warned you that changing hours during the process would effect the redundancy payments.

If had you known that changing to part time would reduce the redundancy payments would/could you have remained full time.

The problem is you are supposed to know this allthough many people don't know how these things work and redundancy is calculated.

How comprehensive were the calculations on the first letter you had, the letters I have had have allways had a breakdown of the calculations that make it faiulry clear that if there were any changes to renumeration this would effect the payments due.

One thing to check is are the numbers correct, there should be a breakdown of how these number are calculated so do check they have them right.

Also make sure they paid the correct holidays and notice pay.

SarEl

These are all very good points. But do remember that they are points to argue with the employer, as they have no legal validity in terms of arguing that you should not have to repay the money. So make sure that you put the best argument you can to the employer, because it is more likley that they will haggle than a court will.

antrobus

moggy101 wrote: »

I am looking for a bit of advice regarding a redundancy overpayment....

This is an entirely different set of circumstances from those outlined by the OP. There is a difference between being told that you will receive £4000 redundancy money, and being paid £4000 twice, and being told that you will receive £4000 redundancy money, being paid the £4000, and then being told that the £4000 payment was wrong. In the former case it is obvious that you have received £4000 that you weren't entitled to, in the latter it isn't.

As stated you "had no reason to question this figure and have spent the money". Or in legal terms, you accepted the money in good faith and relied on the representations made by your employer that you were indeed entitled to this money. I would say that it is very doubtful that the employer can now recover the alleged overpayment of redundancy, especially since you have now spent the money.

I would contact the CAB or a lawyer and get some proper advice.