What happens if I over pay my employer?

There are many circumstances which may lead to an overpayment of wages. Employees find themselves in a position where they are often confused about what happens when there is an overpayment of wages and what their employers can or cannot do. What is an overpayment?

When is an employer entitled to recover overpayment of wages?

An employer is legally entitled to recover any overpayment of wages, either during the currency of the contract of employment, as well as after the employee’s contract has come to an end.

What happens if you overpaid an employee in Manitoba?

Failing to do so can be seen as the employer agreeing to the new wage. New Manitoba legislation states that an employer may only deduct an employee’s overpaid vacation pay up to 30 percent of their net total. The employer may deduct a team member’s pay within one year of the error being made.

Can a employer deduct the overpayment of an employee?

If the repayment can’t be agreed an employer should get legal advice. Tony was overpaid $2000 over 3 years because of a payroll error. His award does not allow a deduction to be made when an employee is overpaid. Tony and his employer, Alice, meet to discuss the overpayment.

What happens when an employer overpays an employee?

The employee promised to repay the overpayment and did not. The employee refuses to pay back the amount. The employer chooses to overlook the error and the employee keeps the payment. The overpayment was a matter of collusion between the employee and the employer and the employee does not give back the overpayment.

Can a employer reclaim the overpayment of wages?

If an employee has been overpaid, can the employer reclaim the overpayment? If the employer has overpaid an employee by mistake then the employer has the right to reclaim that money back. However, employees and workers are protected, under section 13 of the Employment Rights Act 1996, from any unlawful deductions from their wages.

When does an employer have to deduct overpaid wages?

The employer may deduct a team member’s pay within one year of the error being made. No written consent from the team member is required for regular wages, but the employer is required to have a written and signed policy stating that these same deduction rules extend to vacation pay. An employer is free to deduct overpaid wages and vacation pay.