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Overpayment and Deducting Hours New Jersey

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  • Overpayment and Deducting Hours New Jersey

    We just found out an employee was overpayed on one paycheck early this year. Can we legally deduct those hours from their next pay?

  • #2

    Best practice is to get the employee to sign a written agreement authorizing you to deduct the overpayment.

    If the employee refuses to that or some other reasonable settlement (say, over the next two, three or four paychecks), then state law may limit what you can do.

    In Maine, for example, we could only reduce the employee's net paycheck by 10% to recoup an overpayment. If that doesn't cover the entire amount, too bad. We just have to keep going until we get the full amount.
    Senior Professional in Human Resources and Certified Staffing Professional with over 30 years experience. Any advice provided is based upon experience and education, but does not constitute legal advice.


    • #3
      And New Jersey, I understand, is VERY strict about this. Without a signed authorization, it's a no go.
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