Can an employer deduct money from wages to compensate for a mistake? Post Office banking error.

Rgee

Hi Everyone,

I'm not sure if this is the best forum for this question - hopefully someone will point me in the right direction if it's not.

A friend of mine recently started work in a village shop that incorporates a Post Office.  A couple of days ago, during a busy period, they made a mistake with a customer using the Post Office.

The customer wanted to withdraw money from their Post Office account.  Without realising it at the time, my friend processed the request and gave the customer the money they wanted.... but accidentally recorded the transaction as a deposit.

So the customer received the money that they expected but when they check their account the will see that the money that they received in person has also been added to their account rather than deducted!

My friend's employer has said that they will take this 'double amount' from their wages until it is paid off.

Some people have raised concerns that this is not legal - but it may be that the employer is actually doing my friend a favour by not demanding repayment of the money in a lump sum.

I do realise that there is some painful history regarding Post Office accounting, but wouldn't they be able to notify the customer of the obvious error and rectify it without just demanding that my friend makes up the difference?

Many thanks in advance for your advice.

RGee  

Savvy_Sue

they can't do it (legally) unless there is a clause in your friend's contract allowing it. Which there may well be. 

I agree that it ought to be possible to sort it out within the account. 

SiliconChip

It's an error and it can and should be corrected. If the employer doesn't know how to do it then I'm sure there is a Post Office help desk that they can contact to advise.

Undervalued

Rgee said:

Hi Everyone,

I'm not sure if this is the best forum for this question - hopefully someone will point me in the right direction if it's not.

A friend of mine recently started work in a village shop that incorporates a Post Office.  A couple of days ago, during a busy period, they made a mistake with a customer using the Post Office.

The customer wanted to withdraw money from their Post Office account.  Without realising it at the time, my friend processed the request and gave the customer the money they wanted.... but accidentally recorded the transaction as a deposit.

So the customer received the money that they expected but when they check their account the will see that the money that they received in person has also been added to their account rather than deducted!

My friend's employer has said that they will take this 'double amount' from their wages until it is paid off.

Some people have raised concerns that this is not legal - but it may be that the employer is actually doing my friend a favour by not demanding repayment of the money in a lump sum.

I do realise that there is some painful history regarding Post Office accounting, but wouldn't they be able to notify the customer of the obvious error and rectify it without just demanding that my friend makes up the difference?

Many thanks in advance for your advice.

RGee  

Given that your friend has less than two years service their employment could easily be terminated. That is most likely what would happen even if they successfully challenged the deduction.

As Savvy_Sue has said, there may very well be a clause in their contract allowing such deductions in any case.

TBagpuss

It would depend on whether there is a specifc provision in their contract which allows this. If there isn't, then it would be an unlawful deduction from their wages. 

As SiliconChip says, if they know it was an error then they should be able to correct this so there is no reason to deduct it.

TBagpuss

Undervalued said:

Rgee said:

Hi Everyone,

I'm not sure if this is the best forum for this question - hopefully someone will point me in the right direction if it's not.

A friend of mine recently started work in a village shop that incorporates a Post Office.  A couple of days ago, during a busy period, they made a mistake with a customer using the Post Office.

The customer wanted to withdraw money from their Post Office account.  Without realising it at the time, my friend processed the request and gave the customer the money they wanted.... but accidentally recorded the transaction as a deposit.

So the customer received the money that they expected but when they check their account the will see that the money that they received in person has also been added to their account rather than deducted!

My friend's employer has said that they will take this 'double amount' from their wages until it is paid off.

Some people have raised concerns that this is not legal - but it may be that the employer is actually doing my friend a favour by not demanding repayment of the money in a lump sum.

I do realise that there is some painful history regarding Post Office accounting, but wouldn't they be able to notify the customer of the obvious error and rectify it without just demanding that my friend makes up the difference?

Many thanks in advance for your advice.

RGee  

Given that your friend has less than two years service their employment could easily be terminated. That is most likely what would happen even if they successfully challenged the deduction.

As Savvy_Sue has said, there may very well be a clause in their contract allowing such deductions in any case.

Except that (assuming that it is not permitted by their contract or other written agreement)  they would be asserting a statutory right, as protection from unlawful deductions is a statutory protection.

Dismissing someone for asserting a statutory right is one of the 'automatically unfair' reasons for dismissal that doesn't require a qualifying period of employment. (104 (1)(b) of the Employment Rights Act 1996)     However,  they would need to show that that was the reason for the dismissal.

Undervalued

TBagpuss said:

Undervalued said:

Rgee said:

Hi Everyone,

I'm not sure if this is the best forum for this question - hopefully someone will point me in the right direction if it's not.

A friend of mine recently started work in a village shop that incorporates a Post Office.  A couple of days ago, during a busy period, they made a mistake with a customer using the Post Office.

The customer wanted to withdraw money from their Post Office account.  Without realising it at the time, my friend processed the request and gave the customer the money they wanted.... but accidentally recorded the transaction as a deposit.

So the customer received the money that they expected but when they check their account the will see that the money that they received in person has also been added to their account rather than deducted!

My friend's employer has said that they will take this 'double amount' from their wages until it is paid off.

Some people have raised concerns that this is not legal - but it may be that the employer is actually doing my friend a favour by not demanding repayment of the money in a lump sum.

I do realise that there is some painful history regarding Post Office accounting, but wouldn't they be able to notify the customer of the obvious error and rectify it without just demanding that my friend makes up the difference?

Many thanks in advance for your advice.

RGee  

Given that your friend has less than two years service their employment could easily be terminated. That is most likely what would happen even if they successfully challenged the deduction.

As Savvy_Sue has said, there may very well be a clause in their contract allowing such deductions in any case.

Except that (assuming that it is not permitted by their contract or other written agreement)  they would be asserting a statutory right, as protection from unlawful deductions is a statutory protection.

Dismissing someone for asserting a statutory right is one of the 'automatically unfair' reasons for dismissal that doesn't require a qualifying period of employment. (104 (1)(b) of the Employment Rights Act 1996)     However,  they would need to show that that was the reason for the dismissal.

Yes but dismissing them for making the mistake in the first place would be perfectly lawful! So, whilst what you say is true it would be very easy to get round if the employer was careful.

It sounds as though plenty of the two years remains so, in the real world, the employee would be in a very difficult position.

Andy_L

"Your employer is not allowed to make deductions unless:

it’s required or allowed by law, for example National Insurance, income tax or student loan repayments

you agree in writing

your contract says they can

there’s a statutory payment due to a public authority

you have not worked due to taking part in a strike or industrial action

there’s been an earlier overpayment of wages or expenses

the court has told your employer to take debt payments"

https://www.gov.uk/understanding-your-pay/deductions-from-your-pay

The_Unready

Surely all the talk of deductions is irrelevant?

As others have pointed out, the shop/PO (or somebody) should be able to correct the error - if they can't there is something seriously wrong with their IT system (hopefully it's not still Horizon)!

TadleyBaggie

As far as I know it is still Horizon! I worked on (not the dodgy bit) but left 9 years ago. It was supposed to have been replaced about 5 years ago but the last time I spoke to some I used to work with it was still going. 

Norman_Castle

Rgee said:

The customer wanted to withdraw money from their Post Office account.  Without realising it at the time, my friend processed the request and gave the customer the money they wanted.... but accidentally recorded the transaction as a deposit.

So the customer received the money that they expected but when they check their account the will see that the money that they received in person has also been added to their account rather than deducted!

Its an accounting error, there will be a way of correcting this. Very unprofessional of the postmaster/mistress managing the error in this way. The only person who could complain is the customer who would need to prove their entitlement to the overpayment for the complaint to be upheld.
 Is this helpful? https://www.postoffice.co.uk/working-post-office-enquiry