What to do if my former employer continued to pay me for 3 months which I believed was severance payments but now it claims they were overpayments?

Where do I stand legally?

Asked on May 23, 2012 under Employment Labor Law, Kentucky


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

Unfortunately, it does not matter what you believed. Employers are under no obligation under law to provide severance; it's up to them whether or not to pay severance. If there was no severance, separation, etc. agreement between you and the employer granting you this severance, or there  was no policy in place of always paying severance in similar situations which would have entitled you to the money (for example: your employer paid severance of 2 weeks plus 1 week per year of service when firing someone; you were fired, and had worked there for 10 years), then this would almost certainly not have been severance--remember, it's only severance IF there is an agreement or policy making it severance. Otherwise, this probably was an accidental overpayment; however, an error or mistake does not give you any right to the money. If it was an overpayment (no severance agreement or policy), then regardless of what you thought, you have to repay it if the employer wants the money back.

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