Can an employer adjust a termination check after it’s been recieved and cashed by an employee?

UPDATED: Oct 21, 2012

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Can an employer adjust a termination check after it’s been recieved and cashed by an employee?

Check and termination took place last week. Check was cashed immediately after leaving the meeting and 2 days later the check cashing store called me stating the check was invalid (cancelled). Manager notified me after the check was cashed that check was inaccurate (overpaid). Now I am forced to pay a $50 fee for the bounced check which began $224.74 and I’ve returned the money to the check cashing store at the final payment of $274.74. Do iIhave a small claims suit against the business? I was under the impression that in my state the check presented at termination is a final agreement.

Asked on October 21, 2012 under Employment Labor Law, California


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

No, if there was an error and you were overpaid, the employer could stop pay or cancel the check, or alternately request repayment of the overpaid amount from you and, if necessary, sue you for the overpayment if you do not return it.

However, on the other hand, if the employer's error cost you any charges, losses, or fees, like the bounced check fee, they should reimburse you, and you could sue them for those costs or losses (e.g. in small claims court) if you wanted. Note that you are only entitled to 1) what the final check *should*  have been, if it had been calculated accurately--assuming you have not otherwise received this amount; and 2) your bounced check fee and other costs; you can't recover the overpayment itself.

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 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.

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