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A little back story. I was part time at my job working 25 (instead of 37.5) hours a week for a few months. Our pay roll had changed during this time to twice and month instead of bi-weekly. I made enough as part time that I never needed to look at my statement. However, when pay roll changed they started paying me a full time salary despite me working only part time still. After 3 pay periods of this, I went back to full time. I've now been working full time for about 3 months and just found out about this over payment.

The catch is, I've put in my 3 weeks notice to go back to school. Now they're saying I have to pay back $3000, which I don't really have to give back in one chunk like this.

My question is: Is this legal? Can they do this? If it's their mistake, am I actually forced to pay it back? Payroll has made this mistake before when I first went to part time, and I gladly paid back the money they over paid because it wasn't a problem then. It is now.

I live in Ontario Canada. If there's any information you need, please let me know. I must admit I'm a little flustered writing this question.

EDIT: What if you don't have the money? I've given my 3 weeks to go back to school, not start another job where I can actually get the money to pay them back.

DarkCygnus
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Jeremy W
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    Yes you owe them the money. However, because it's their mistake, you can reasonably request some accommodation in paying it back (e.g. paying back over time). – Kaz Jul 19 '17 at 16:01
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    Be aware that under these circumstances, you almost certainly will get as much of this as possible taken out of your last paycheck. As for the rest, sell some stuff or take a part time job until it is repaid. . – HLGEM Jul 19 '17 at 16:52
  • @HLGEM I'll be in school, so part time work doesn't really work for me here. I guess if they're just going to take all of my last pay and I'll still owe more that's just something I'll have to accept. They mess up, I get screwed, yay. – Jeremy W Jul 19 '17 at 16:54
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    @HLGEM Well done on showing no empathy. You don't know how many hours my school is and just assume everyone can handle the stress of college and work. I agree with your last point, I should have been checking my pay and I take responsibility for that. Obviously won't be happening again. – Jeremy W Jul 19 '17 at 17:05
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    @JeremyW I would suggest next time you see a big potential overpayment you inquire immediately. It might be a bonus, otherwise you have to give it back. – Neo Jul 19 '17 at 17:42
  • @JoeStrazzere Unfortunately I don't put all my money right into investments. But I see your point. – Jeremy W Jul 19 '17 at 17:54
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    You don't need empathy, you need tough love. You need to stop blaming others for your mistakes. It is never acceptable to spend money you were paid in error. So no sympathy for you because you should have known not to spend it. Time to grow up. Yes it might make things hard for a little while and you might have to work and go to school one semester or borrow from your parents. Big deal. We all have to do things we don't want to do to make up for our mistakes. But what you have to understand is that it is your mistake not theirs that caused this issue since you spent money that wasn't yours. – HLGEM Jul 19 '17 at 18:51
  • @HLGEM Angry much? You're clearly not too educated on mental health issues. You can't just suck it up, or be happy if you're depressed or anxious, or over stressed, that's not how it works. I've admitted I made a mistake and yeah I will live with it. And yeah, as I stated in the question, I was frustrated when I posted it. – Jeremy W Jul 19 '17 at 19:04
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    @JeremyW, I have dealt with mental illness for 50 years and every single person in my family is mentally ill. I know very well how it works and when people are making excuses for not trying. BTW, you had not mentioned you were mentally ill or that I should make allowance for it. I didn't tell you to be happy, you can work through the pain of your mistakes and be unhappy. But you need to understand the problem was of your making. – HLGEM Jul 19 '17 at 21:29
  • "Our pay roll had changed during this time to twice a month instead of bi-weekly." isn't twice a month and bi-weekly the samething? – Donald Jul 21 '17 at 00:59
  • @Ramhound Nah, twice a month works out to 24 pay periods in a year, where as bi weekly is 26 pay periods in a year. Very similar, but slightly different. – Jeremy W Jul 21 '17 at 13:42
  • It's tempting in these situations because you don't have money. On the flip side, since you don't have money (working part time as your only job) the company would know the likelihood of recovering this fund is minimal. That doesn't mean they - the company - can't go to court and get a big hit on your credit (which will affect your future jobs prospects, loans, credit cards, houses, etc) which generally lasts for 10 years in the USA and I'm sure in Canada has something similar. So smart thing to do is call them up. They might be happy to get back some of it but explain the situation. – Dan Sep 10 '19 at 19:09

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It's legal, they can do this, and you should have raised the issue then and there.

Much more importantly, in case you ever get a similar situation owing to a bank error or a tax refund error, you should not have spent the money because it wasn't yours to begin with.

Try to seek an arrangement with them.

Denis de Bernardy
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    Speaking of taxes, I don't know how it works in Canada but if the OP is going to get any tax documents from their employer they're going to want to triple check that the numbers are correct. – BSMP Jul 19 '17 at 15:55
  • @BSMP They will be taxed according to what their T4 states, so if the payroll was messed up and they didn't fix it on the tax slip, OP would have to pay taxes on money he didn't earn which would suck. Unless he could prove he was never actually paid that amount (IE they took back due to overpayment). This could land him in a higher tax bracket and actually cause him to make less money and owe taxes. – SaggingRufus Jul 19 '17 at 16:22
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    If they gave you papers that show how income, and they can't fix this to state a low income, then obviously they didn't overpay you. – gnasher729 Jul 19 '17 at 16:31
  • In his defense since they changed payroll systems he may not have realized the change due to different pay cycles etc. – Bill Leeper Jul 19 '17 at 16:36
  • @SaggingRufus, The company can and should adjust the taxable amount for the year to take out the overpayment, however, he will have to wait until he files taxes to get the money back. – HLGEM Jul 19 '17 at 16:49
  • I wasn't aware there was an issue then and there, hence the question. I'm not going to another job, I'm going back to school. It isn't as easy as just pay it back, your loss ha ha. – Jeremy W Jul 19 '17 at 16:52
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    @JeremyW: Indeed. Really just be honest with them and try to seek an arrangement. Worst case, and most natural resolution, would be you borrowing from your parents or family and paying them back. Make it clear your family won't cover for you if they won't. Best case is they'll cut their losses. Something in between might be you repaying the excess they paid you, either by working a few hours per week or with interest down the road. Just be honest with them and be open to explore options. Tip: considering that you're still young, a few crocodile tears sometimes help. ;-) Good luck! – Denis de Bernardy Jul 19 '17 at 17:05
  • @HLGEM Agreed, but if they don't, that is what would happen – SaggingRufus Jul 19 '17 at 17:06
  • @DenisdeBernardy I appreciate the response. I agree, and it probably won't be as big of a deal with some time, just very frustrated at the moment. $3000 is just a lot of money to me lol – Jeremy W Jul 19 '17 at 17:08
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    @JeremyW: Also, as already pointed out in the comments, be sure to "innocently" wonder what the PAYGO implications will be on their end. You know, just to stick their nose in manure. For all you know they might consider how big a mess it'll be to sort out, and explore rosier alternatives. There's this thing in business called law of triviality where people spend huge amount of money over tiny costs. The odds are strong that it'll actually cost them $3k in salaries et al to get those $3k back from you. – Denis de Bernardy Jul 19 '17 at 17:11
  • @DenisdeBernardy PAYGO is in regards to how they're going to change the T4's and that I just "lose" the extra taxes I paid on getting more money? – Jeremy W Jul 19 '17 at 17:25
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    @JeremyW: I'm not so privy to Canadian tax laws but I'd gather you got it right, yes. PAYGO stands for pay as you go taxation and is, if memory serves, how it's done in Canada. Basically, the odds are they've paid taxes related to your salary already and that getting a refund will cost them dearly in administrative BS. – Denis de Bernardy Jul 19 '17 at 17:45