Overpaid Wage - long one

[duckquackquack]

Can anyone help on this one?

I am currently on maternity leave with DC2, my last wage went through towards end of April. Anyway with DS being only 6 weeks and with a 2 year old DD running me ragged I didn't check my wage slip (even if I had my mind wouldn't have registered any discrepency).

I have had a phone call yesterday from work saying they have over paid me, they take full responsibility but they want me to send in a cheque for over £650 as soon as possible, which would be ok but I have spent this money on bills / debts and do not have the cash to pay back.

I am going to go into work to talk it out to come to some arrangement to pay the money back as I did not know I had been overpaid. But the only way I can pay back is to either get a loan or credit card which then I would have to also pay interest on.

I would agree to taking a cut in wage but I am only going to be getting maternity pay which is crap as it is with a mortgage / bills etc.

Anyone any advice at all? It would be greatly appreciated as I am really stressing where I am going to find this money.

Thanks

You don't have to pay this back all at once, they should accept installments. The wage cut should go into effect when you return from maternity leave, not now. It should wait until you go back.

Thanks for the prompt advice Fluffy, that is a huge relief what you say espec. about the return from mat leave as I would struggle with it coming out now.

But it is just such a huge amount when you have to pay it back not so big when spending it!

True. It's always like this though. Have you double checked everything?

You do have to pay it back I'm afraid, they should give you the flexibility of time scale and amounts though as it was their stuff up. Maternity pay isn't pay from them, IIRC, the government pay the company who pay you so they can't technically demand any of this to repay the overpayment. Try not to worry too much about it. See what they say tomorrow. If their demands are too much then don't sign anything and speak to the CAB before you agree.

They can ask you to pay it back but you can legally refuse (although I wouldn't advise this) as FluffyBunnyGoneBad said they can't take it from your maternity pay, so repayments should start once you return to work and you should mutually agree the amount etc in writing. I manage a large HR dept and we have several employees paying back overpaid money in this way, it's fairly common.

Some common misconceptions.

Your employer does not need your consent to reclaim overpayment of wages. For most deductions from pay, your consent is required, but there are some exceptions and overpayment is one of them. So technically they can take it all back at the earliest opportunity from your pay.

'Pay' that your employer can deduct from does include maternity pay, so they can technically deduct from your SMP.

You can't refuse to pay it back (although you can refuse to write them a cheque as they have requested).

You don't have any right to it being deducted in instalments.

Having said all that, given the circumstances, the fact that it was their mistake and the fact that you are on a reduced income at the moment anyway, demanding a cheque for the full amount isn't particularly reasonable imo. I think you should request that instalments are agreed and that they don't start until you return from maternity leave.

They may well not agree to that, as it's a long time for them to wait, and if you don't return from maternity leave they will then obviously lose the option of deducting it from wages and instead will be relying on getting you to physically pay it back.

I think a compromise of somewhere in between is likely.

Sorry to be the bearer of bad news, I just didn't want you going in there stating you had a legal right to pay in instalments, or to refuse to pay at all, or anything, because it's just not the case where it's an overpayment.