What to do if my employer mistakenly overaid me and now wants me to repay the monry?

I’m a new nurse . I opened my pay stub today via Internet. A co-worker was standing near me and she pointed it I was getting an incentive pay. To be honest I only read the hourly rate, my paid time off, 401k and my total amount. i haven’t noticed any difference In pay since me being hired. I took it upon myself to investigate this incentive $2.50. I went to my manager thinking I needed to do the right (which I had solved the incentive pay which was they where paying me as a night shift employee. I was honest and confronted manager about this. My manager stated payroll has made the mistake of paying me the last 7 monthes an extra $2.50 an hour. Finance is stating I pay back this extra money back in 7 months. They will not give me an extension.

Asked on January 24, 2013 under Employment Labor Law, Indiana

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 7 years ago | Contributor

If you were overpaid, you have to repay the overage otherwise you would be what the law calls "unjustly enriched". Th fact is that an error of this nature does not create a right for an employee to keep an overpayment. Your employer's mistake does not entitle you to money, just like if you were accidentally underpaid, they'd have to make good the shortfall. Further, they are giving you 7 months to re-pay.

Note: An employer cannot unilaterally withhold the money from an employee's paycheck, at least not without the employee's consent. Instead, if an employee owes the company money and won't repay it, then it has the right to sue the employee.


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