What is my wife’s responsibility if her employer has paid her insurance premiums but forgot to deduct her paycheck for them?

UPDATED: Sep 30, 2022

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What is my wife’s responsibility if her employer has paid her insurance premiums but forgot to deduct her paycheck for them?

My wife is currently working for a company that offers health insurance. Over the last 8 months, they

have not been taking her insurance costs out of her paycheck. Her employer is now demanding her to

repay the 8 months of insurance that they did not take from her pay. Is this legal?

Asked on July 27, 2017 under Employment Labor Law, Pennsylvania


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

Answered 5 years ago | Contributor

This comes under the heading of "unjust enrichment". This is where someone receives and accepts money or a benefit that they have not earned, many times due to another's mistake. This is the case here. In such a situation some states allow an employer to automatically deduct from the employee's paycheck for such an error. In other states, the employee must agree to a deduction in writing or agree to pay back/return the money/benefit. If not, then the employer can sue the worker in small claims court and/or terminate that worker. Therefore, your wife needs to repay the 8 months of insurance prremiums that her employer failed to charge her for. At this point, she should try and negotiate a repayment plan with her employer.

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