My daughter has been dismissed from her from her employment with marks and spencer on the 31/1/2015. Reason on grounds of ill health. On February 2015 she received a letter stating she had been overpaid the total of £2,997.19. these over payments were a combination of SSP & CSP. The dates of the overpayment were September 2013 till January 2014. No breakdown of debit given. She has contacted both the overpayment department who issued the letter and her manager at the store, also the store finance manager. All of whom now state that the minimum payment the store can accept is £249.00 per month for 12 months, until the debt is cleared. The are also saying if she cannot pay the debt with be handed over to their solicitors who deal with unpaid debts. My daughter is unemployed on non contribution based ESA of £72 per week. I have read if they have not collected the debt in the 12 month period the debt occurred. She should be exempt from payment. Is this correct?? She is not in a financial position to pay the amount suggested.
Hello, my name is ***** ***** it is my pleasure to assist you with your question today. Did she know at the time that she as being overpaid?
No. She was on CSP awaiting manager submitting forms for SSP
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.
However, 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:
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.
I hope this clarifies your position? If you could please quickly let me know that would be great, as it is important for us to keep track of customer satisfaction. Thank you
The debt only became apparent upon termination of her contract on the 31/1/15. She was not inform till 9/2/15.
That does not matter in the circumstances - employers can come months and even years after the end of employment to try and claim back overpayments
We have check Kim's payslips which she had to print off as the company does not provide this service. We have noticed an adjustment we do not understand. It is for a sum of -£5538 780hours x £7.10.
A new manager had taken over in March 2014 this is where the adjustment has taken place.
Kim was in private rented flat. The money she was paid she used to pay her rent and bills. She tried to claim housing benefit, but as the company were still paying her, her claim was rejected.
Can you advise how we can raise the 'estoppel'
Do we need to see a solicitor to act on our behalf??
She did Contact the wages and salary department and was told that the monies paid were correct. Any adjustment for sick pay would be collected from the january / February pay in 2014. The adjustment were taken out February 2014 pay. Kim then started to claim unemployment benefit in February/ March 2014
What is our next course of action.??
I have read in the TUC handbook, if a company does not start to collect an outstanding debt within 12 months of it occurring. They cannot proceed to collect it, if no payment have been made. Is this correct.
estoppel may not work if she used the money to pay her rent and bills - these are everyday expenses which would not meet the requirement to show that the money was spent on something additional which she would not have generally spent it on had she not had it. Even if you still want to use it as a defence you would only be able to do so if a court claim is made and you raise this as a defence in court - you can mention it to the company now but officially it is done in court if she is facing a claim by the employerAs to the 12 month time limit that is not correct - a debt can be pursued legally for 6 years in the courts so they can still take it further even after the 12 months
My daughter had leave her rented flat in june 2014 as she could no longer afford to live away from home. Her health had deteriorated further and she required assistance in her daily living. She is still unemployed at present. She has completed a chronic pain management course and is due for a review in March 2015.
When you state the money cannot be used or everyday items. Eg rent etc. She did pay for private physio and transport to get to and from appt in hospital. Would that meet the criteria.
she must show that she has changed her position as a result f these payments, but the issue is that the courts have traditionally interpreted this quite narrowly - she can raise these costs as a defence of claiming estoppel but whether a court agrees is unknown until it gets there and a judge make a decision
The company have now said they will had the debt over to their solicitors to collect the debt on their behalf. Kim is not in the financial position to pay the debt off. She is on non contribution based ESA of £72 per week.
The company did want her to pay £249 per month over the new 13 months.
Should we continue to dispute the claim and raise a court action on the grounds of estoppel. We have asked for a meeting with the company HR team. Still awaiting an appt.
the solicitors can make threats and requests for the repayment but unless they go to court and win they cannot force her to pay. Even if they win the court will consider her position and ability to pay and if needed they can order a repayment plan that is reasonable for her in the current circumstances. But as I said all of that depends n whether they actually win
you cannot raise a court action however - as mentioned estoppel is used as a defence if the employer makes a claim
The stress of this is exaserbating her health condition. Chronic pain and anxiety. She is under the care of the psychology services and chronic pain management team. She is now living full time at home, having moved back home in June 2014.
We appreciate your time and advice. Many thanks. Carole
Can they add extra interest to the outstanding debt if it remains unpaid??
yes that is possible but you are looking at around £250 per year for the amount owed - so obviously if it is settled earlier it would be much less
Her manager did say if she remained remained unemployed for the next 6 months the debt would be written off. I asked if that was the care could she have this in writing. This was refused by the same manager.
We have since received an email from wages and salaries stating that the manager and the store manager have advised the overpayment to continue to recouped the full amount via their solicitor acting on their behalf.
the initial comment would not be binding unfortunately, they are free to pursue this if they wished to
I though during the conversation with my daughters manager that I was being paid 'lip service' hence why I asked for it in writing.
The manager also said if she paid £1,000 the rest would be written off. I asked if this was the store managers statement, if replied yes. I asked why £1,000 and could he confirm that in writing. He would not commit. So, I rejected his suggestion.
I have kept a log of all the conversations, should they proceed to a court case.
unfortunately it may not be legally binding and just part of negotiations - nothing to lose by raising it but be realistic about its effectiveness
Thank you. I plan to Contact the overpayment dept and see what is happening to the debt now. We had no further correspondence with the company since the email. I presume it would be wise to Contact them, as this problem is causing my daughter extreme stress.
Many thanks for your advice. It is much appreciated.
Kind regards Carole
you are welcome, all the best and hope you get to resolve this
I will rate your advice so that you can collect payment. :-)
thanks good night