I received an email today from the superintendent of schools. I had emailed him a payroll question. In his email response he explained that the school had made a mistake in their deduction of insurance premiums from my paychecks. The school has a separate benefit for spouses that are both employed by the school district. Spouse only pay $1 a pay period. My wife stopped teaching two years ago but they continued to only deduct $1 from my pay. I have direct deposit and never caught the mistake.

Here is the email
For all of 05-06 to date, you have had only $1 deducted. We will need to somehow deduct the appropriate amount for the year. In addition, we need to review your deductions for 04-05 because it appears your health deductions were insufficient then also. While a teacher is on leave and not being paid, the employee still working should be deducted just as any other employee

I have looked for law pertaining this but have only found law that deals with overpayment of wages. Is this considered an overpayment of wages is it? Anyway, I am just wanting to know what my rights are in this situation. My wife and I cannot afford to out of pocket for their cumulative mistakes.

Any advice would be appreciated.

The fact that you get direct deposit does not excuse you from knowing whether your deductions are correct. They made the initial error, but you made one in not catching it. They are entitled to correct the mistake. The law does not say that you get to keep the extra money if not enough is deducted for benefits or that if the employer makes a mistake they have to eat it.

OK so I most likely will have to repay for my employers mistake. So this leads to more questions:

How will the payback be handled?
Is it a lump sum?
Can I define the terms?
Do I have to pay back both years within this year?
If I change jobs am I required to pay a lump sum?
If I would have changed jobs before the mistake was made would I still be liable for it?

Thanks for the reply. I did all that I could not to kill the messenger with my follow up. :D

All of those decisions are not addressed by any state or federal law. It is whatever the employer determines. We would have no way of knowing.

Is an "eroneous" deduction of insurance an overpayment of wages? If not then how can it be deducted form my wages.

Neither my wife or I was issued a COBRA notice of our of rights of re-insurance after she stopped her employment there. I don't understand that in light of all of this that they can come back and seek retroactive repayment for the amount of premiums that they feel like we should have been paying. Aren't we entitled to a choice if they decide to change our premium amount?

No, it is not. It is an erroneous deduction FROM wages.

My question now is that since we were never notified of a change of insurance premiums (no COBRA notice given, which is a federal law) can we be held responsible for the past insurance premiums. Isn't a change in insurance coverage required to have a written signature.

Also if we are forced to pay back what are the maximum deductions they are allow to withhold without signature?

Did the coverage change? Did the premiums even change? All that I read here was that they didn't deduct the proper amount. COBRA kicks in when there is a loss of coverage. I didn't see where that occurred here.

If they want to, they can legally deduct all the way down to minimum wage.

The coverage and the premiums both changed. We went from a both spouses employed plan ($1 a pay) to a normal family coverage plan ($250+ a pay)

If your wife had had a separate policy for which payments were coming out of her paychecks, then her terminating her employment would have triggered COBRA requirements as she would have been losing her coverage. COBRA is not an issue here. Surely, at some level, you knew that there was a policy in place that your wife's insurance only cost $1 per month while she was employed by the school system. Did you expect that not to change when she left?