What is the law regarding an employer who states that an employee was overpaid their salary due to a typo in the contract but it’s been over a year?

I have a co-worker who is being told she was overpaid for the past year and owed the district approximately $5000. They are stating that her initial contract, that was signed over 1 year ago by both parties, had the incorrect salary on it and she now owes back pay. Given that she signed a contract and the salary was explicitly stated, is there any validity to their claim? It seems like they may be trying to pressure her to sign a document, which may modify the original contract.

Asked on September 22, 2017 under Employment Labor Law, Colorado

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

If her contract set her wage/salary, then she was NOT overpaid  *unless* it was known and clear to both parties (employer and employee) that the salary was lower and that the contract definitely contained a typo. For example, say that all correspondence leading up to the contract stated clearly that the salary was $50k, but the contract contained $55k--IF the evidence is strong that *both* sides knew what the correct salary was and someone just mistyped (in this example, keyed an extra "5"), then the employer may be able to recover the money. This is because a contract gives effect to the agreement of the parties, so if the parties had in fact agreed to a different salary, a court would reform the contract to reflect their actual agreement as to how much she should have been paid.
But the evidence would have to be strong that both employer and employee had agreed to a different, lower number: if there are grounds that your co-worker could have legitimately and in good-faith believed that the contract salary was correct, the employer cannot after-the-fact decide that it paid too much; if they led her to believe or let her believe that her salary was correct, they are bound to what is in the contract.


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.