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Ben Jones
Ben Jones, UK Lawyer
Category: Employment Law
Satisfied Customers: 48497
Experience:  Qualified Employment Solicitor - Please start your question with 'For Ben Jones'
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I have been overpaid by the NHS Trust for the past 21 months,through

Customer Question

I have been overpaid by the NHS Trust for the past 21 months,through no fault of my own and last month one of the team leaders picked up on their mistake and now they are trying to recover the whole debt until the end of this financial year,amount I can't afford.I already offered to pay £50 per month,however I was told by the Matron that the HR wont accept that and the amount they want is £327/month.
Can you advise me if the employer can do that?
Submitted: 3 years ago.
Category: Employment Law
Expert:  Ben Jones replied 3 years ago.

Ben Jones :

Hello, my name is Ben and it is my pleasure to assist you with your question today. Did you know you were being overpaid?

JACUSTOMER-vix8jcyr- :

Hi

JACUSTOMER-vix8jcyr- :

I didn't know that

JACUSTOMER-vix8jcyr- :

I was made aware by one of the team leaders

Ben Jones :

Do you agree you were overpaid?

JACUSTOMER-vix8jcyr- :

I do and already offered to pay £50/month

JACUSTOMER-vix8jcyr- :

Back in July 2012 when I informed the team leader about my intention to reduce my hours I was told to write a letter to the Matron and that was all

JACUSTOMER-vix8jcyr- :

Only now I was told I was supposed to sign another form to be sent to the HR and payroll

JACUSTOMER-vix8jcyr- :

But that particular form was supposed to be given to me by the management

JACUSTOMER-vix8jcyr- :

I wasn't aware of the form

Ben Jones :

If someone has genuinely been overpaid by their employer, then that is not money to which they are legally entitled and it should be repaid. The law specifically allows an employer to recover previous overpayments from an employee’s salary without their consent. However, they must still act within the implied term of trust and confidence, something which exists in every employment relationship and requires both parties to act fairly and reasonably. So whilst they can recover the overpayments, they must ensure the amount they take does not leave you in a poor financial situation and take out a reasonable amount. So £50 may be too low, yet £327 could be too high so something in between could be reasonable.

Another option is for an employee may be able to use the legal defence of ‘estoppel’ to resist an employer's recovery of an overpayment. One of the main cases dealing with this is that of County Council of Avon v Howlett. The employee was a teacher who was paid more sick pay than he was entitled to. The teacher queried the overpayments with the employer but was assured they were correct. By the time the Council had realised their mistake, the teacher had spent most of that money. The Court of Appeal held that the defence of estoppel prevented the employer from recovering the whole sum of the overpayment.

The way estoppel operates is that if the following conditions are satisfied, then an employee should be able to use it as a defence to resist the recovery of an earlier overpayment:

  • The overpayments were made due to an error by the employer
  • The employee genuinely believed they were entitled to the money, or did not even realise that they were being overpaid
  • The employee has since 'changed their position', meaning they have spent the money in question. However, this does not mean just spending it on usual items of expenditure, such as bills, everyday spending, etc – you must have gone out of your way and changed your position, such as making additional purchases which you would not have done had you not received that money.

So whilst there is nothing stopping an employer from pursuing a claim to recover an overpayment, if the above conditions are satisfied then an employee could raise the defence of 'estoppel' and prevent the claim for proceeding any further.

JACUSTOMER-vix8jcyr- :

I understand

JACUSTOMER-vix8jcyr- :

I is very helpful your answer

JACUSTOMER-vix8jcyr- :

I meet all three conditions for estoppel

JACUSTOMER-vix8jcyr- :

Do you advise me to invoke this estoppel when I will have the meeting with the HR rep?

JACUSTOMER-vix8jcyr- :

Silly question on my part

JACUSTOMER-vix8jcyr- :

volens-nolens I will have to pay whatever they decide because I cannot afford a solicitor in this matter

Ben Jones :

Good morning, you have nothing to lose by raising this defence with your employer, but the issue is that if hey refuse to accept it and take the money anyway, all you van do is challenge it in court or tribunal (although you can also use the formal grievance procedure at work first). Hopefully you can come to an arrangement with the employer, it would also be helpful to gather any information you have to show that the amount they try and take is unreasonable and will leave you in a difficult financial position, for example breakdown of your incomings and outgoings. Hope this clarifies your position?

Ben Jones :

Hello, I see you have accessed and read my answer to your query. Please let me know if this has answered your original question or if you need me to clarify anything else for you in relation to this? I just need to know whether to close the question or not? Thanks