Overpaid Wage Battle Continues Minnesota

[smurfetteMn]

Hi everyone! Me again. Same problem, new twist.

Earlier this month I posted a question about the timeline for paying back overpaid wages. I was wondering if it would be reasonable to ask for a payment plan, and what my options were. I received some good advice and awaited an amount from my former employer.

Which I finally received today. The amount is about $975, and they told me that I had to pay it back by December 15 (two weeks notice) in full, or else I will be liable for the gross amount ($1600) next year.

This seems a little harsh to me. Two weeks seems to be an unreasonable amount of time, and I certainly cannot understand how I can be held responsible for paying back more money than I was ever paid to begin with. (I have received $1400 in two paychecks, and 50 hours of that money was rightfully mine for time worked).

I am still willing to payback the net amount, but certainly not in the next two weeks. Am I legally liable for the gross when this is their mistake? And when the notice was so short?

Any help would be appreciated. Thanks.

My original post was:
http://www.laborlawtalk.com/showthread.php?t=162466

[JulieBean]

They certainly can't MAKE you pay back the wages before the end of the year, but they can take you to court to get the wages if you don't pay them back. Should they have given you more time to get the money together? Not necessarily. If you were overpaid, they are not wrong for assuming you have the extra cash you were paid just sitting in the bank.

I would think that since you had found out about the mistake, you might have started saving (or not spending the extra $$) in order to pay them back in a timely manner. In fact, I'm surprised you didn't notice right away that you were overpaid.

I'm sure your employer will get the money back one way or another if they really want it. Just so I get this straight, if you pay $975 within the two weeks allotted, then that's it? But if you wait until after the two weeks, then you have to pay them the full $1600 that you owe? If I were you, I'd pay the $975 and be glad that I'm keeping $625!

[JulieBean]

I should have read your previous post first... oops.

My answer still stands, though. If you want to pay back the $975, that's up to you. But if your employer wants that money and they are willing to go through all the trouble to get it, then they can take you to court if they so choose. I'm not one to take chances, but that's just me.

I hope you get things figured out and this has a happy ending!... good luck!

[ScottB]

Originally Posted by smurfetteMn

Am I legally liable for the gross when this is their mistake?

Probably. The court will decide that, if it comes to that.

Looks like they are trying to collect the net pay you were paid while letting the feds and state government keep the taxes collected, including the employer's share of FICA, any SUTA or FUTA owed plus WC premiums.

I would think that would be messy, come tax time, when you paid in extra taxes on money you gave back.

Your objective should be to repay the gross pay and the employer does not have to pay in taxes on income not earned.

Make an offer to repay the full amount, but on terms that are acceptable to you. The problem is the tax issue and this needs to be settled before the end of the year. If you make payments every Friday, beginning on December 1, you can do it in five payments, or $320 per week for five weeks.

Maybe there are alternatives, so call for help from Patty or some one else with expertise in tax and payroll issues.

[JulieBean]

Good Lord how could I forget about the almighty taxes?! Thanks for bringing it up Scott.

[smurfetteMn]

Thank you both for your replies.

I think what I will do is borrow the money to pay back the $975, and return it within the timeframe, so that the taxes are correct and I will be clear from an IRS standpoint.

By sending a certified check, and maintaining the written documentation that they have sent me, I will have satisfied their request and protected myself to the best of my ability. It isn't a perfect solution, given holiday finance crunches, but at least the see-sawing will be over.

Thank you for the help.