Overpayment from old employers

jamieferns

Hi there,

This is my first post so I'm sorry if I've not put this in the right place... just hoping for a bit of advice.

I began a new job 2 months ago after leaving my old place of work. Both companies pay on the same day of the month. On my first pay day at my new job, I also received a wage off my old employers, to which I didn't think anything of as I'd not long left the company before being paid.

However on the pay day just gone, I got yet another full wage from them, which was an obvious over payment. I text my old manager to ask for a contact in payroll who I could the repayment out with.

I received no response from my old manager but I got a letter in the post the next week from my old employers informing me of the over payment but they suggested I had been over paid two months wages and not just the one.

After some back and forth they sent a revised over payment amount (£200 less than originally stated). I have gone back both times insisting I want to pay back the most recent months pay (obviously) but I'll need to do so in installments as I'm being taxed heavily on my new wage (due to not receiving a P45) so my financial situation is slightly compromised.

As for the initial payment I received that I thought was genuine I had spent the funds in good faith, as I didn't realise it was a payroll error. As they are demanding the full amount of both back, I will not be in a position to pay it back. They did eventually detail the breakdown of this over payment, but it was almost 2 months after I had received the funds.

I'm just wondering if anyone has any advice/experience with a situation like this. I of course want to pay back the latest pay but the initial one I honestly didn't think was an wrongful payment and no longer have. The total is over £2k that they're asking for, which as a 19 year old, I'd struggle massively to repay it in one go.

I've seen an old policy called 'estoppel' used online in situation such as this, but I am not sure if that would apply to my situation as I didn't make an attempt to question the legitimacy of the first over payment as I thought it was genuine.

Any help would be greatly appreciated.

Thanks in advance.

Jamie

spadoosh

You need to work out if its actually an overpayment or not.

If its an over payment youll need to pay it back. If its not you wont.

In all likelihood the old employer will accept a payment plan because if they dont theyll be chasing you through courts which takes time and money so would prefer to avoid it.

P45 isnt an issue, your new employer shouldve had you fill out a new starter checklist which shouldve seen you put on the correct tax code. Either way, thatll sort itself out in a few months.

MEM62

jamieferns wrote: »

As for the initial payment I received that I thought was genuine I had spent the funds in good faith, as I didn't realise it was a payroll error.

There is no such defence as 'spending the finds in good faith'. If your previous employer has made a genuine mistake then they are entailed to all the money back.

jamieferns wrote: »

The total is over £2k that they're asking for, which as a 19 year old, I'd struggle massively to repay it in one go.

It shouldn't be as the additional £2 overpayment you has would effectively have been a financial windfall. What did you do with it?

The best you can hope for is that they will accept a monthly instalment plan to ease the pain.

[Deleted User]

You have acknowledged that the second payment was an overpayment.

How can you say you can’t pay this back in full? You can’t say I’m in financial trouble I’ll keep that and pay you gradually, you would of still been in financial trouble if that second payment hadn’t been paid to you by mistake.

jamieferns

MarkN88 wrote: »

You have acknowledged that the second payment was an overpayment.

How can you say you can’t pay this back in full? You can’t say I’m in financial trouble I’ll keep that and pay you gradually, you would of still been in financial trouble if that second payment hadn’t been paid to you by mistake.

I would pay back the second over payment back in full, but being emergency taxed has meant my income has fell below that of what is owed for that payment - meaning I cannot accommodate for all my monthly bills; which is the reason I left for a new, better paying job in the first place. My concern is the first over payment.

jamieferns

MEM62 wrote: »

There is no such defence as 'spending the finds in good faith'. If your previous employer has made a genuine mistake then they are entailed to all the money back.



It shouldn't be as the additional £2 overpayment you has would effectively have been a financial windfall. What did you do with it?

The best you can hope for is that they will accept a monthly instalment plan to ease the pain.

The first over payment I believed to be genuine, so I used it the money to live a more 'luxurious' lifestyle you could say. As it's been revealed now, almost 2 months later, that it was in error on their behalf, how was I to know at the time? Again, the second one I wanted to reimburse straight away, but have been unable to (will obviously pay this back once I've been paid).

jamieferns

spadoosh wrote: »

You need to work out if its actually an overpayment or not.

If its an over payment youll need to pay it back. If its not you wont.

In all likelihood the old employer will accept a payment plan because if they dont theyll be chasing you through courts which takes time and money so would prefer to avoid it.

P45 isnt an issue, your new employer shouldve had you fill out a new starter checklist which shouldve seen you put on the correct tax code. Either way, thatll sort itself out in a few months.

Thank you bud. Will hopefully get my taxed code sorted soon, that will help to repay the money.

spadoosh

jamieferns wrote: »

I would pay back the second over payment back in full, but being emergency taxed has meant my income has fell below that of what is owed for that payment - meaning I cannot accommodate for all my monthly bills; which is the reason I left for a new, better paying job in the first place. My concern is the first over payment.

To get the money back they need to either ask you for it and you give it to them or they have to go to court, make their argument that you owe them money and then have the court order you to pay the money back to them. All of which takes time.

Its just a case of having to pay back as much as you can as soon as you can. Im sure you dont want this hanging over you longer than neccessary and stretching it out is more likely to see them taking the court route.

Man_From_Bath

i love this, over £1000 appeared in your account and you never queired it ! good one.

Just offer to pay £10 per month back if you've spent it but good luck in the rest of your life ! Credit Cards will love you.

jamieferns

Man_From_Bath wrote: »

i love this, over £1000 appeared in your account and you never queired it ! good one.

Just offer to pay £10 per month back if you've spent it but good luck in the rest of your life ! Credit Cards will love you.

I believed the first payment to be accurate as I had not long left the company... the second one I queried straight away.

jamieferns

spadoosh wrote: »

To get the money back they need to either ask you for it and you give it to them or they have to go to court, make their argument that you owe them money and then have the court order you to pay the money back to them. All of which takes time.

Its just a case of having to pay back as much as you can as soon as you can. Im sure you dont want this hanging over you longer than neccessary and stretching it out is more likely to see them taking the court route.

Of course not, was just seeing where I stood in terms of what I thought was mine (first payment). As you say, I want to get this resolved smoothly just as much as my ex employer.