Overpaid?

RiseToMe

Hi Guys,

Handed in my notice to a place where I work PT, I am self employed director in my own company as well (so PAYE worker there too). Director called me in today to say that he had noticed that they had been overpaying me since January (I started in Nov) to the tune of about 4 grand total.

It gets a little more complex as he cant seem to recall what they offered salary wise and honestly, neither can I, it was almost a year ago and I was in Tesco when they called (salary didnt matter to me I needed the position to satisfy other requirements for a course I teach so it wasn't a defining part of the conversation).

This teamed with the fact that I was never given a contract so I was unknowingly over paid for this time. I didnt notice as I was paid the exact same every month (in November/Dec it was higher as I had tax credits) every month it was consistently the same figure.

He has given me two options:
Work until the end of the year for free (!!!!)
Or pay back the 4000.

In theory I think I have to pay it back? However I have issue with the fact that I will not have seen most of that 4000 myself, I will have paid 50% in taxes as it was all taxed at the higher rate, so where does that leave me?

I have sought legal advice however I would like a couple of views on this as I am waiting on calls back and this is stressing me out big time.

RFOLEY1990

RiseToMe wrote: »

Hi Guys,

Handed in my notice to a place where I work PT, I am self employed director in my own company as well (so PAYE worker there too). Director called me in today to say that he had noticed that they had been overpaying me since January (I started in Nov) to the tune of about 4 grand total.

It gets a little more complex as he cant seem to recall what they offered salary wise and honestly, neither can I, it was almost a year ago and I was in Tesco when they called (salary didnt matter to me I needed the position to satisfy other requirements for a course I teach so it wasn't a defining part of the conversation).

This teamed with the fact that I was never given a contract so I was unknowingly over paid for this time. I didnt notice as I was paid the exact same every month (in November/Dec it was higher as I had tax credits) every month it was consistently the same figure.

He has given me two options:
Work until the end of the year for free (!!!!)
Or pay back the 4000.

In theory I think I have to pay it back? However I have issue with the fact that I will not have seen most of that 4000 myself, I will have paid 50% in taxes as it was all taxed at the higher rate, so where does that leave me?

I have sought legal advice however I would like a couple of views on this as I am waiting on calls back and this is stressing me out big time.

if he doesn't know how much he was supposed to be paying you and has no contract to back him up how could he have been over paying you legally?

Gaillimh1976

If you were being paid the same all along, why is it an overpayment from January not November ?

Would 4,000 be a significant % of the overall salary (are we talking 4K from a 18-20K total or a 50-60K total or a 80-90K total )

To be honest I doubt they have a leg to stand on with no written contract in place, you would be well within your rights to keep the money, but depends whether you want/need to part on good terms with these people

RossieMan

Offer half as a good will gesture. I wouldn't be returning the whole lot without a contract stating up salary.

BrokenArrows

RFOLEY1990 wrote: »

if he doesn't know how much he was supposed to be paying you and has no contract to back him up how could he have been over paying you legally?

Exactly.

If you don't know, and he doesn't know how much you should have been paid and you have no contract I would argue that you were paid what you were paid. End of.

However if you do end up paying the money back then there is the issue of Tax etc.
You dont technically owe 4k but will probably have to pay that back and then claim the excess from the tax man.

Alkers

RossieMan wrote:

Offer half as a good will gesture. I wouldn't be returning the whole lot without a contract stating up salary.

RossieMan wrote:

Offer half as a good will gesture. I wouldn't be returning the whole lot without a contract stating up salary.

Don't think you should do this. Ask for clarification of the situation in writing and take it from there. If you're going to pay it back, pay 5e a week or month.

RiseToMe

Thanks for the replies so far guys,

In November I was only paid for the few days that I did for that pay month, in December I apparently did extra days (I honestly dont remember!!) So the mistake was January onward.

I genuinely don't recall the salary offered to me (when filling in my starter form I handed it back with the element blank and told my manager I had no idea what I was offered!). He asked me today if i could recall what they offered so i was honest and he said he thought it was X pro rota and on that basis I was being over paid. He seems to think it they may have put me down as working 3 days when I was working only 2 but my payslips say 16 hours which is two days.

Obviously I'm not going to work for free until the end of the year- I am leaving for a reason, so the paying it back seems like the only option-my issue is that most of it never reached me, it was sucked up by the tax man!

I dont know if legally I can just walk away and not pay it back from googling a bit- not accurate I know but as I said, I am awaiting the legal position call which may take some time!

Stheno

Are you still working there?

macnug

Don't pay it back, if he wants it back let him go the legal route and incur the cost to find out without a contract he hasn't a leg to stand on.

RiseToMe

Stheno wrote: »

Are you still working there?

I handed in my notice last week- no contract so legally only had to give them a week but gave them a month as goodwill as the staff turnover is high and they are very stuck for staff

Dial Hard

Am I the only one who's actually mind-boggled at the idea of someone not knowing what money they had agreed to work for???

Stheno

RiseToMe wrote: »

I handed in my notice last week- no contract so legally only had to give them a week but gave them a month as goodwill as the staff turnover is high and they are very stuck for staff

SO you are still getting paid by them?

Will you earn enough to cover what you owe between now and when you leave?

RiseToMe

Dial Hard wrote: »

Am I the only one who's actually mind-boggled at the idea of someone not knowing what money they had agreed to work for???

I am self employed- I earn what i need from my own company. As i said in my OP, I needed this job to satisfy the requirements of a teaching position I also held, so pay wasnt a factor. The only things I required and was concerned about was flexibility around my full time job and clinical exposure to satisfy the teaching requirement.

StupidLikeAFox

If he can't remember the offer and you can't remember the offer, who is saying you were overpaid?

RiseToMe

Stheno wrote: »

SO you are still getting paid by them?

Will you earn enough to cover what you owe between now and when you leave?

No I wont, I only have one pay cycle left and as I am taxed at full rate and only do 8 days per month for them the amount owning over 9 "overpaid" months versus one months pay is not enough to pay them back in full

Stheno

RiseToMe wrote: »

No I wont, I only have one pay cycle left and as I am taxed at full rate and only do 8 days per month for them the amount owning over 9 "overpaid" months versus one months pay is not enough to pay them back in full

Are all of your tax credits allocated to your primary job in your company or are they split between that and this job?

RiseToMe

StupidLikeAFox wrote: »

If he can't remember the offer and you can't remember the offer, who is saying you were overpaid?

Thats kinda also where I am at with it also, he reckons his offer wouldve been around X per annum based on what others in my position are on, instead when he seen I was Y he came to the conclusion that as it was filled in as pro rota rate he mustve paid me for 3 days per week and not 2.

endacl

Tell him that, according to your records, you were underpaid. Make up any old figure you like.

RiseToMe

Stheno wrote: »

Are all of your tax credits allocated to your primary job in your company or are they split between that and this job?

All of my tax credits are allocated to my primary job, none for this company as the pay was negligible and not neccessary

Stheno

RiseToMe wrote: »

All of my tax credits are allocated to my primary job, none for this company as the pay was negligible and not neccessary

And is the overpayment he claims net or gross pay?

RiseToMe

Stheno wrote: »

And is the overpayment he claims net or gross pay?

Gross

Mrs OBumble

RiseToMe wrote: »

All of my tax credits are allocated to my primary job, none for this company as the pay was negligible and not neccessary

So the pay is negligible, yet you got overpaid 4k in eight months, and no body noticed until now.

Ahh, how exactly???


Someone is extracting the urine here.

moc moc a moc

Tell him to take it out of the dosy accountant's salary instead

RiseToMe

Mrs OBumble wrote: »

So the pay is negligible, yet you got overpaid 4k in eight months, and no body noticed until now.

Ahh, how exactly???


Someone is extracting the urine here.

The pay is negligible to me with respect to what I am paid through my own company, therefore I allocated my full tax credit to my own salary. It went unnoticed to me as I took what I was paid every month as what I was supposed to be paid. It didnt change, so it wasnt a once off payment of 4k that arrived that I didnt notice. And in reality of that 4k only 2k of it reached my bank over 9 months after tax.

Tiddlypeeps

Mrs OBumble wrote: »

So the pay is negligible, yet you got overpaid 4k in eight months, and no body noticed until now.

Ahh, how exactly???


Someone is extracting the urine here.

That's only an extra 500 a month, which if the boss thinks is a 33% over payment means the total pay was around 1,500 a month. After the tax man has had his way that only leaves about 700 a month. If you already earn a decent salary from another job then 700 extra a month isn't likely to be a meaningful amount. That doesn't negate the annoyance of being asked to fork out over 4k in one payment tho, especially when the conditions around the request are so shaky.

@OP I would just tell your boss in the politest way possible that you won't be paying back anything until he proves there was in fact an over payment. "I don't think I would have paid you that much" is not a good enough position to be demanding someone pay them anything, let alone 4k.

RiseToMe

Tiddlypeeps wrote: »

That's only an extra 500 a month, which if the boss thinks is a 33% over payment means the total pay was around 1,500 a month. After the tax man has had his way that only leaves about 700 a month. If you already earn a decent salary from another job then 700 extra a month isn't likely to be a meaningful amount. That doesn't negate the annoyance of being asked to fork out over 4k in one payment tho, especially when the conditions around the request are so shaky.

@OP I would just tell your boss in the politest way possible that you won't be paying back anything until he proves there was in fact an over payment. "I don't think I would have paid you that much" is not a good enough position to be demanding someone pay them anything, let alone 4k.

Got it in one Tiddlypeeps, total pay was 1500, minus taxes meant that overall the amount wasnt make or break for me.
Owning to the fact that my tax credits are used on my own salary, my teaching salary is self declared in addition to this, the fact that I didnt notice is not unusual, my tax situation is a little beyond normal.

My main gripe with this whole thing is paying him back 4k when I only seen at most 2k of it (if even!). I only have 2 more weeks of work there and only 1 pay day so therefore it wont be corrected by Revenue by just doing a deduction each payday and it balancing out.

IrishZeus

Op,

Your employer hasn't a leg to stand on. No contract, no written agreement - nothing.

Repayment depends on you. If you decide for your own reasons to repay it, then so be it. If you decide not to, they have no recourse to force you to.

This will end up being more of a moral conundrum for you than a legal one I suspect.

RiseToMe

IrishZeus wrote: »

Op,

Your employer hasn't a leg to stand on. No contract, no written agreement - nothing.

Repayment depends on you. If you decide for your own reasons to repay it, then so be it. If you decide not to, they have no recourse to force you to.

This will end up being more of a moral conundrum for you than a legal one I suspect.

At the end of the day I have my own company, I know how much of pain something like this could be, so I would like to pay it back if he feels its owed.

The big issue is that I'm leaving, so I cannot let it be deducted and let the tax issue balance out, so all I'm left with is the option to pay 4k but only 2 of that actually made it to me, so why should I be even more out of pocket?

From his view, hes 4k down and he wants it back in full.

TheChizler

If you did that wouldn't you just claim the other 2k back from Revenue? It they can provide proof you were overpaid by 4k.

OldMrBrennan83

This post has been deleted.

Tiddlypeeps

RiseToMe wrote: »

At the end of the day I have my own company, I know how much of pain something like this could be, so I would like to pay it back if he feels its owed.

The big issue is that I'm leaving, so I cannot let it be deducted and let the tax issue balance out, so all I'm left with is the option to pay 4k but only 2 of that actually made it to me, so why should I be even more out of pocket?

From his view, hes 4k down and he wants it back in full.

If you do pay back the 4k then as long as your employer reflects it in your P45 then you should be able to claim back any extra tax you paid from revenue in a fairly reasonable amount of time. It used to only be a couple of weeks turn around time for claiming back things like emergency tax, which should be a similar enough scenario to this, but I haven't had to deal with them in a while so no idea what they are like speed wise these days.