Employer went into my account to 'reclaim' overpayment

Jariya

They haven't 'gone' into your account as such.

They made the payment to you via BACS transfer and they realised there was a mistake (you have said you can see what the mistake was yourself).
They should have advised you of the mistake, however you should also for your own benefit checked and double checked exactly what you were due to be paid.
They haven't broken any laws and the money is not yours to have.
They have simply made a recall for an error.

Any company who pays by BACS is able to recall a payment if an error has been made.
This isn't Santander doing something 'insider' and they would have done the same thing once the error was spotted if you had your bank account at any other bank.

DVardysShadow

Jariya wrote: »

They haven't 'gone' into your account as such.

They made the payment to you via BACS transfer and they realised there was a mistake (you have said you can see what the mistake was yourself).
They should have advised you of the mistake, however you should also for your own benefit checked and double checked exactly what you were due to be paid.
They haven't broken any laws and the money is not yours to have.
They have simply made a recall for an error.

Any company who pays by BACS is able to recall a payment if an error has been made.
This isn't Santander doing something 'insider' and they would have done the same thing once the error was spotted if you had your bank account at any other bank.

So it is shoot first and ask questions later?

Where a payment has been made to the wrong party, I can see that your argument applies. But where a payment of a wrong amount has been made to the right person, it should not apply. If any employer other than the employee's banker had made this mistake, there would have been a due process followed to recover the money. That has not happened in this case and the OP is rightly aggrieved

Uncertain

Jariya wrote: »

They haven't 'gone' into your account as such.

They made the payment to you via BACS transfer and they realised there was a mistake (you have said you can see what the mistake was yourself).
They should have advised you of the mistake, however you should also for your own benefit checked and double checked exactly what you were due to be paid.
They haven't broken any laws and the money is not yours to have.
They have simply made a recall for an error.

Any company who pays by BACS is able to recall a payment if an error has been made.
This isn't Santander doing something 'insider' and they would have done the same thing once the error was spotted if you had your bank account at any other bank.

I agree with DVardysShadow.

I don't know if you work in a bank or have expert knowledge of banking rules but answer me this.

Suppose I make a BACS payment to you of £100.

A few days later I realise I have made a mistake and should only have paid you £50.

Up to what point (if at all) could I require my bank to reclaim the money from your account?

Naf

If they'd noticed straight away and the money had gone into my account and immediately out then I wouldn't have cared just about it showing on my statement. If they had contacted me immediately about it and ensured I knew it would be getting claimed back so not to spend it then fine. Failing all that they should have contacted me about the error and made arrangements to repay. Instead they fixed their end, and way to wash their hands of the consequences.

Jariya

Uncertain wrote: »

I agree with DVardysShadow.

I don't know if you work in a bank or have expert knowledge of banking rules but answer me this.

Suppose I make a BACS payment to you of £100.

A few days later I realise I have made a mistake and should only have paid you £50.

Up to what point (if at all) could I require my bank to reclaim the money from your account?

I've worked in various sectors of finance for 25 years. Not banking itself but I deal with our bank regularly and my colleagues deal with payments and recalls - all of which I have actioned myself and been responsible for in many most of the companies I have worked at.

It varies how long you have before claiming a recall depending on the account and bank. I've actioned a recall once which had to be done two weeks after the payment was made and it was returned to us successfully.

If I were in this position I would contact someone who deals with employment law - get a free half hour with a solicitor in that sector. I do think that they should have informed their employee that this was to happen..but at the same time I would have made it my responsibility to find out exactly what I should be expecting at the point of leaving the job.
There may be something that could be done with not having been informed of the error - on that I'm not sure - hence the suggestion of speaking to someone who knows all about employment law.

Naf

My_e-mail_to_HR wrote:

I am expecting letters from you regarding the matters contained herein, but they need addressing more urgently than waiting for your second class post to arrive (incidentally, nothing has arrived yet). On the 4th July I finished my employment with Santander, and as such anticipated my final wage to be paid around the 19th. I did not know how much I was expecting; not being certain how the pay periods were structured, knowing there could be up about £400 in a service bonus plus not knowing what holidays I had taken; so when on the 16th £808.50 went into my account I, naturally, took this as my final wage – it was not the usual monthly wage I had received before so, clearly, had been calculated and I trusted it was correct. I therefore repaid the payday loan I had outstanding of £500 as well as making other extra payments to bills and buying household groceries. Then, on the 18th (in the afternoon) you entered my account without my permission, and without contacting me in any way, and took the full £808.50 from my account, leaving me £675 over my agreed overdraft with no access to any money to pay rent, other bills or to buy food and other basics for my family. In addition, any of my state benefits which get paid into this account (although I have done my best to change them, my £520 in tax Credits and £230 in Housing Benefit have probably not been changed soon enough) will be completely inaccessible and therefore this will cause further difficulties both this month and next. I immediately contacted you regarding this, and had the error explained to me so I understand what has happened, and that this money was not owed to me, and would have been happy to arrange to pay it back. But the error was on your part, not mine, and I am the one now left paying for it. I attempted to discuss this with you, including the fact that you have no right nor business entering my bank account without my prior consent, nor without contacting me first. The best offer I received was that my charges would be paid for me; whilst I appreciate this, it doesn't help me with being able to cover basic living expenses this month, and probably into next month. In addition the charges are £5 per day capped at 20 days per month (i.e. £100 per month) and there is no way it will be possible for me to clear this account within 12 months; especially when I will be paying you back for my bikes4work separately and will have to apply for a government Crisis Loan from the Social Fund and will be paying separately for that also. This means you will be covering £100 per month of charges for over 12 months; £1200 or more that you will not get back. Whereas if you rectify the illegal activity of accessing my account then I will only be making repayments to you, plus you will be getting back the money, as opposed to pouring it into an almost bottomless pit of monthly charges. This seems like a perfectly reasonable and amicable solution to me, and better for both of us.
You made the error, which means you can't leave me in a worse situation than before it happened (and it's not like I'm asking you to better my circumstances; had you not made the error I would have simply not paid off my payday loan or made any extra payments to other debts and arrears); the only two ways to do this are either for you to cover the unauthorised overdraft (£675) and associated charges (£5 per day, two days: £10) and ensure my credit file is not adversely affected, but you will have this repaid alongside the Bikes4Work fees; or you can cover my monthly charges (£100 per month, 12+ months: £1200+) and correct my credit file month on month for this entire period, but never see any of this money to cover charges back again. The choice seems simple. In addition, should you continue to adopt the second option, I will be unable to use the account so it will have very little turnover and the £1000 authorised overdraft will expire in around 11 months. From that point I will continue to be charged £100 per month unauthorised overdraft fees until I have paid off the £1000 also, and will continue holding you responsible for them.

This situation needs to be resolved, and quickly. I would rather it be done amicably, but my next step will have to be ACAS and their pre-claim conciliation service and, ultimately, an employment tribunal if necessary. But I hope it does not come to that.

HR_Response wrote:

I am in receipt of your email of 20/7/11 and respond accordingly.

Whilst I appreciate that the circumstances of the overpayment have been explained to you, I do feel it necessary to document them here for the sake of clarity.

Your last day of employment was 4th July 2011. You had previously entered into a ‘cycle to work’ scheme and applied for a loan of £700.00 in May 2011, with the first of 12 repayments commencing in June 2011. During routine investigations of all loan accounts it was discovered that you had been credited in error £751.05. We sought to rectify this as part of the monthly account reconciliation process used in the instances of salary overpayments
or mistaken payments. This process is undertaken on the 18th/19th of each month. Unfortunately due to a calendar anomaly (what?), £808.50 was credited to your account on 16th July 2011 (Actually around 9pm on the 15th). You then spent these funds prior to the 18th July 2011 upon when we then reclaimed
the payment.

As I understand it your position is as follows.

1. You believed that the £808.50 was your salary and that you were entitled to spend it.
2. You believe that we were not entitled to reclaim the funds without your authority.
3. You state that our action has put your account into an unauthorised overdraft and that we have guaranteed to meet all of your overdraft charges.

In response to point 1, whilst we acknowledge that this situation is the result of a mistake, such mistakes are recoverable at common law (yes, from future salary payments). You had received an amount to which you were not entitled and to which you had received no consideration. In my view you should have been aware that salaries are only every paid on the 19th of each month with Santander account holders receiving them a day in advance. In addition to this, salaries are remitted for the full current month. This was clearly communicated to you in your offer letter and contract of employment (OK, so I ought to have known this better; but the last time I saw this was when I signed it two years ago).

You have stated that you were not aware of how much you were expecting, level of service bonus amount, number of holidays taken or structure of payment period. You acknowledge that you made an assumption that you were entitled to these funds. I note that you did not seek clarification from Santander or receive any confirmation that this payment was correct. You then proceeded to spend it within a 48 hour period. The speed of which you disposed of the funds sent to you in an unusual time of which you cannot fully account (I thought I did, as above?) negates any liability on our part for adverse consequences which affect you.

Santander has a general right of set off with regards to our employees and Santander accounts. This is confirmed within your contract (nope, or not as far as I can see... will post the relevant section up here when I can get at it). We are therefore not required to either notify you of our intentions or seek your permission to do so. I trust this deals with point 2 in a clear and unequivocal manner.

Regarding point 3, I have reviewed the circumstances of your conversations with representatives of the company. You have stated that a verbal offer was made to meet your overdraft charges. This is incorrect. The clear offer was made to meet your charges for a one month period only (nope, I was told that any charges I incur as a result would be covered). This offer was made by a representative who was not fully aware of the situation (so if I am not 'fully aware' of the speed limit, can I avoid a fine for speeding?). However, I am prepared to honour as a gesture of good faith, on receipt of confirmation of your bank charges incurred on the 19th July only. I also note that at the time of the mistaken payment your account was £881.28 into your overdraft. Therefore even without this mistaken payment crediting the account you still would have exceeded your overdraft limit after settling the third party payment of your payday loan (Didn't I clearly say that I simply would not have settled it?). It is therefore unclear how we can be held liable for a financial predicament you would have ultimately experienced without our involvement.

Maybe this might help?

Mistral001

Santander seems to be claiming that you knew full well that you were not entitled to the money put into your account because of the £700 loan you had with them and you should have known that that would have had to be settled when you left and would come out of your pay packet. They seem to be suggesting that you should not have spent this money within 48 hours of getting it without checking with them.

To be frank there seems to be a lot of bad blood between you and the people at this firm. That is perhaps colouring both the firms and your thinking here. and are treating their loan of £700 rather casually. I would not go to any Bank-related organisation, but straight to the Small Claims Court. There a judge would be able to decide whether it was reasonable for someone to spend money recieved into their account within 48 hours of receiving it to pay a pay day loan. The firm might bring out their big guns to make an example of you and you might loose on some clever legal technicality, but then you might not.

PS. there could be a lot of resentment by Santander towards the way you paid off the pay-day loan company quickly whereas you are treating the £700 that you borrowed from them a lot more casually. They may think that because they do not employ the rough tactics that perhaps the pay-day loan companies use, they are getting treated worse than them by you as a result.

Naf

Mistral001 wrote: »

Santander seems to be claiming that you knew full well that you were not entitled to the money put into your account because of the £700 loan you had with them and you should have known that that would have had to be settled when you left and would come out of your pay packet. They seem to be suggesting that you should not have spent this money within 48 hours of getting it without checking with them.

Yes, I had a bike under the bikes4work scheme, but there was not £700 left outstanding. I also do not remember the hire agreement stating that it would be deducted from my final salary; only that the amount would become due within 14 days of leaving the company and they would contact me regarding it. This is likely to be another oversight on my part :-S

At the end of the day they've made a mistake one way or the other, I don't think I've acted unreasonably, although maybe a little hurriedly.

Jariya

DVardysShadow wrote: »

So it is shoot first and ask questions later?

Where a payment has been made to the wrong party, I can see that your argument applies. But where a payment of a wrong amount has been made to the right person, it should not apply. If any employer other than the employee's banker had made this mistake, there would have been a due process followed to recover the money. That has not happened in this case and the OP is rightly aggrieved

My apologies, I missed this.

I have also read the OP's next post and will quote and go through it to the best of my knowledge once this post is done.

My posts are not intended to be mean. I apologise for perhaps a lack of empathy shown - it was intended more in the way of being straight with things that I am aware of having worked in finance in many sectors over the years.

The due process which you mentioned..yes absolutely! The employee should have been informed (having read the next post..there is a bit of a 'however...' to add to that which I will explain in my next post breaking the emails down (I wanna be in the sun! But I will reply..it might take me a while so bear with me please - this is for yourself and obviously predominantly the OP (opening poster).

On the subject of being aggrieved..of course! I would be too..except I have a 'however' to add to that I'm afraid as well.

Just one thing to add..and the reason for my posts having come accross showing a lack of empathy..when I have asked for help myself on something financial/work related or even on a relationship I prefer the hard line..tell me what you know with no fuss. Be blunt..don't make it rosy when it isn't rosy.

This is where my responses are coming along the lines of..because I would rather know that it is going to end in tears because it gives me a chance to be proactive about it rather than reactive.

But..that is just me..my apologies if I have sounded harsh and I may well sound harsh with some of my responses to the copied mails as well. It is meant with good intentions so that the person with this nightmare (because I would be having a nightmare if the same happened to me too) knows a bit more about where they stand.

Naf

Mistral001 wrote: »

PS. there could be a lot of resentment b Santander towards the way you paid of the pay day loan company quickly whereas you are treating the £700 that you borrowed from them a lot more casually. They may think that because they do not employ the rough tactics that perhaps the payday loan companies use they are getting treated worse than them by you as a result.

I'd pay them back the lot if I had it handy...
I'm happy to pay it back at an affordable level, but only without it affecting my credit file as I don't see why it should.