payment error after resigning from company

I resigned from my company last month and on the 28th they deposited money into my account. I called them to let them know of the error. Can they legally reverse a direct deposit without notifying me? Also, how long does the company have before the money is mine?

Asked on May 2, 2017 under Employment Labor Law, Missouri


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

Answered 3 years ago | Contributor

As a general rule, an employer (or anyone else) cannot make a withdrawal (by reversing a deposit or otherwise) any amounts from a person's personal account without the person first having authorized it. However, you may need to check anything that you have signed with your former employer. Typically, when when an employee signs the authorization for payroll deposits, it almost always authorizes withdrawals under a situation such as yours. That having been said, legally you do owe your empoyer this overpayment and must return it if asked. To keep it would amount to an "unjust enrichment" which the law disfavors.

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