Want to talk to an expert employment law solicitor?

You'll receive a callback from a specialist within an hour

The recovering of unpaid wages can be an embarrassing situation for an employer to be put in. Businesses obviously want to pay their workers only what they’re due – they have to make a profit, after all. However, employers must bear two issues in mind if they have overpaid their workers in wages. Firstly, employers must act in accordance with the law in recovering the money that they believe has been overpaid. Secondly, recovering overpayments of wages can cause employers embarrassment and can damage the morale of their workers.

There are four issues that an employer should consider in attempting to recover an overpayment of wages to a worker:

  1. Has an overpayment actually been made?
  2. What is the value of the overpayment?
  3. What are the legal routes through which an employer can recover the value of the overpayment?
  4. How can the employee stop the employer recovering the overpayment?

Has an overpayment actually been made?

The first issue that should be considered is the obvious one of whether an overpayment has actually been made. This is a crucial consideration – if the employer attempts to deduct money from the worker’s wages as a result of a false belief and is taken to the Employment Tribunal then they may be the subject of potentially expensive and lengthy proceedings. It’s important, therefore, that the employer gather all evidence possible of the overpayment and that the evidence is presented to the employee. Although the presenting of the evidence is not strictly necessary it may stop the worker from reverting to Employment Tribunal proceedings.

What is the value of the overpayment?

Again, this is a fairly obvious consideration. The employer won’t want to collect too little from the worker but then again collecting too much can cause damage to morale (as the employer is seen as unfair). However, an important consideration is that the employer is to a certain extent protected from having proceedings issued against them if they mistakenly but honestly collect too much money from the employee’s wages as compensation for the previous overpayment.

What are the legal routes through which an employer can recover the value of the overpayment?

An employer can deduct sums from the wages of its workers if it honestly believes that an overpayment has been made.

How can the employee stop the employer from recovering the overpayment?

An employee cannot bar an employer from recovering overpayments by deducting sums from their wages if such an overpayment has in fact occurred. However, the important element, as stated above, is to be sure that an overpayment has occurred.

An employee can also use the defence of common law promissory estoppel to prevent their employer from reclaiming overpaid wages. To qualify for protection under promissory estoppel the employee must satisfy 3 conditions:

  1. That their employer made representations of fact that entitled them to believe that the sum if money overpaid was theirs; and
  2. That the employee has “changed their position” (by spending some or all of the money) and in doing so acted in good faith and without notice that their employer wished to recoup the overpayment; and
  3. That the employee was not primarily at fault for the mistake

 

About

Redmans Employment Team deal with employment matters for both employers and employees, including drafting employment contracts and policies, advising employers and employees on compromise agreements, handling day-to-day HR issues, advising on restructures, and handling Employment Tribunal cases for both employers and employees Call 020 3397 3603 to speak to one of the members of our employment team or email us on enquiries@redmans.co.uk. Redmans have offices in Richmond, Chiswick, Hammersmith, Fulham, Kingston, Wimbledon, Ealing, Kings Cross and Marylebone (meetings strictly by appointment only).

Tagged with →  

Want to talk to an expert employment law solicitor?

You'll receive a callback from a specialist within an hour

Share →

Leave a Reply

Your email address will not be published. Required fields are marked *

 

Our awards

Request a callback

Your name

Your email

Your telephone number

Contact us

Please feel free to discuss your own position and concerns. Contact your nearest office on:

T: 020 3397 3603
E: enquiries@redmans.co.uk
W: www.redmans.co.uk

Testimonials

4.62 Average

53 Reviews

Anonymous

Both Rana and Chris were fantastic. From the first phone call I was confident my matter was in good hands. I was not disappointed. I would highly recommend Redmans. Thank you again for all of your support and advice.

Posted 3 days ago

Federico S

Great advices and communication. Through Redmana I obtained match more than what I thought. Highly recommended

Posted 5 days ago

Tom G

A good and efficient service with the required legal advice provided for a settlement agreement.

Posted 5 days ago

Francis T

The solicitor I used was Chris Hadrill, who I found extremely professional and I felt that he made me feel at ease, considering the subject matter he was assisting me with.

Posted 1 week ago

Anonymous

Chris provided excellent assistance with the negotiation of my settlement agreement. From start to finish, I was consitently updated and advised on the best course of action to take. I would highly recommend Chris and Redmans Solicitors.

Posted 1 week ago

Anonymous

They are busy people but manage well so generally I would recommend them.

Posted 1 week ago

Anonymous

Very efficient and professional service from my first phone call making an enquiry. Timescales of the matter in hand were met and within the agreed budget. Would highly recommend Redmans

Posted 3 weeks ago

Lisa B

Really very good service, always available to answer questions, provide my with any information I needed to make informed decisions.

Posted 3 weeks ago

Anonymous

Offered good support and advice

Posted 3 weeks ago

Anonymous

Chris reviewed and managed my compromise agreement swiftly, accurately, helpfully, and on budget. His input on key non-compete clauses was valuable, his communications were clear and concise, and he was always swift in responding. Highly recommended.

Posted 3 weeks ago

Gurbir C

Excellent legal advice service.

Posted 3 weeks ago

Tim

I found Redmans to be very helpful and efficient in conducting my case which was concluded in a timely and diligent manner

Posted 3 weeks ago

Anonymous

I found Redman Solicitors to be very good and worked very well to an extremely tight timescale. I would happily recommend them again especially Rana.

Posted 3 weeks ago

Anonymous

I received excellent, knowledgeable and critically timely support from Chris regarding my settlement agreement, and would wholeheartedly recommend Chris in these matters.

Posted 3 weeks ago

Katelyn

The solicitor communicated well with me and made sure I understood everything. He did everything needed for my settlement agreement and tried to get the wording changed in my favour too.

Posted 4 weeks ago

Anonymous

Redmans provided excellent services

Posted 4 weeks ago

Sibel U

Excellent service

Posted 4 weeks ago

Peter S

I was very happy with the level of advise I received from Caroline Lewis, and a very professional service fron Chris, The advice given really helped me and I was comfortable to sign the settlement agreement following my redundancy. I would be more than happy to recommend your services to others.

Posted 4 weeks ago

Derek S

I very much appreciated the help provided by Redmans in the settlement agreement agreed with my former employer.

Posted 1 month ago

Waseem M

It was the first ime I used Redmans Solicitors and to be honest, thety were amazing. Rana Tandon and Chris Hadrill were out of this world. They made the process as simply and smooth as can be. Thank you so much for all your support over the last week.

Posted 1 month ago

Anonymous

Worked very quickly considering right deadlines - and gave great advice

Posted 1 month ago