i had this problem just a few weeks ago actually
and was on the phone to my legal advice line that i get free with my nanny insurance...
(BTW this was for money that they overpaid me in septmeber 2006 and didnt tell me or give me any way of knowing until november 2007 ie 14 months later)
I wanted to know where i stood....
answer was yes you HAVE to give it back... there is no arguement, as they have said they have over paid (even if you couldnt have reasonable known as i couldnt) you HAVE to give it back.
They are also perfectly entitled to ask for it all back in one go but suggested it has to be 'reasonable'.
The 3 month thing sounds reasonable.
They can legally take it all out of your next wage packet apparently.
was shocked but that was what the employment layer told me on the phone just 3 weeks ago when i wanted to know excatly where i stood.