Overpaid by employer

Have they provided a full breakdown of what you worked and what you have been paid to explain the difference

They said last summer they overpaid me

That's a long time to notice such a big mistake.

Have they provided a full breakdown of what you worked and what you have been paid to explain the difference

This - be sure they have calculated the overpayment correctly. However it sounds like quite a sum not to notice/mistake for holiday pay (how much do you get paid if you get >£2k holiday pay when you only work 'a few months each year')?

But at the end of the day if the calculation is correct then you are legally obliged to hand the money back (making sure any tax/NI overpayment is also corrected). I assume CAB could advise on what is considered a reasonable repayment schedule – 'not earning much'/'shooting a hole in finances' doesn't absolve you of your responsibility to pay the money back unfortunately.

I’m also supposed to work for them this summer, but I understand they’re not legally allowed to deduct this from my salary.

This is a tricky one – an employer can deduct from your salary but only with your permission. It's taking the money without permission that they cannot legally do. However your circumstances are possibly slightly different depending on whether the Contract of Employment signed last year means that the work you do this year is a continuation of employment or will you be signing a new one. I have no idea if an employer can deduct money from a different period of employment if you are working under a new contract.

That’s a long time to notice such a big mistake.

They could have had an auditor in and they spotted it? Or a new finance director going through things with a fine tooth comb? Lots of reasons it might take time to be noticed.

Slightly different but my previous employer overpaid me small amounts over a long period added to £800 when I took a promotion, I never noticed it at the time as I thought it was the going rate. An internal audit flagged it up and they asked for it all back in a lump sum, nah you can have it back in the small amounts just like you overpaid me in.

what's to stop them doing a court claim if you don't pay it back?

I understand they’re not legally allowed to deduct this from my salary.

They can for overpayment but can’t put you below a certain threshold. Surely you’d not notice it though.

They provided a spreadsheet, yes.

What happens if I simply say 'sorry, can't pay it back'? Do you think they'd take legal action for 2.5k?

what’s to stop them doing a court claim if you don’t pay it back?

Nothing - that would be their next legal step.

What happens if I simply say ‘sorry, can’t pay it back’? Do you think they’d take legal action for 2.5k?

For the cost of making a small claim - why not?

I'd have thought so. Easily under the small claim, (or whatever it's called these days) at little risk to them.

I’m sitting in the - you knew you were overpaid but kept quiet - camp, hoping it would never come up! How much holiday pay can you accrue for ‘a few months work’!?

They said last summer they overpaid me about 2.3k. I didn’t notice it at the time and assumed it was holiday pay.

You mean you did notice at the time and assumed it was holiday pay? Personally, I'd have checked there and then.

Why not get back to them and suggest a lower amount that you can afford?  You can only ask.  I think you have no chance of not paying and you would lose whatever job you have with them over summer. Don't take the piss though and imo it's usually better to get stuff paid off sooner rather than later

Seems odd you can’t afford a monthly amount but you failed to think that an extra £2.3k has arrived in your account. And then you have apparently spent it, without noticing again.

Anyway, as long as it’s proven it’s their money and you owe it back. Best course of action is to agree a plan for what it is you can afford and go with that. Oh, and leaving doesn’t help btw, they call still pursue you for 5 years I think it is.

At the time I was doing a lot of work so had a few big payments going in - I had a lot of income last summer, but studied an MA this year, so most of it's gone on living costs. You're all right though, I should have checked into it more at the time.

In any case, it's a good contract, so I should probably pay them back - they said that ". This figure is also calculated before tax, NI and pension, so if this was to be recalculated to a net amount (more accurately reflecting the pay you actually received, after such deductions) then this would be significantly lower."

Obviously being paid a lump sum, how can one pick apart what was deducted for tax, NI, etc., between what I was meant to get paid and what I actually got paid?

Thanks!
FM.

Sounds like you were at least basic rate tax last year from what you have said. The 2.3k will be at your highest rate so 20% if in basic rate band or 40% if more than 2.3k of your salary was in higher rate banding. Also 12% NI. Pension is a tricky one because you get a benefit from that but it sounds like they may take the deduction in to account.
If they just deducted 2.3k from this year’s salary there could be a massive difference in take home pay due to your lower earnings and NI has gone up so that the NHS is now swimming in spare cash.

My mrs is head of payroll

You will have to pay it back

try to get an agreement on how to suit your circumstances