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Ben Jones
Ben Jones, UK Lawyer
Category: Law
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I am asking a question on behalf of my daughter. She has recently

Resolved Question:

I am asking a question on behalf of my daughter. She has recently received two letters from ***** ***** travel agents, her previous employer. The first letter explaining how due to a fault on their part, she had received an overpayment of salary, the second letter demanding recovery of this overpayment and saying if they do not receive payment by 29 April they will start legal proceedings. She has been in contact with them by email requesting to speak to someone to explain that she cannot meet this deadline but as yet no one has contacted her by phone.
This error occurred nearly a year ago and ***** ***** have explained they have only noticed this error in a recent audit, since then my daughter has taken up a new post with Coop travel so no longer works for ***** *****, as no one queried this at the time she genuinely thought it was a tax rebate (considering the time of year this occurred) and ***** ***** have said the fault was with their payroll system. The error, as explained in one of their emails, was as a result of a failure on their part to recall a final monthly salary to make adjustments to, consequently she received the original monthly payment as well as the adjusted monthly payment.
From what I have read on the internet employers have the right to ask for repayment of overpaid salaries from existing employees but it becomes a civil debt if the person is no longer an employee (?). They are asking, in an email, she pays £188.75 over 4 months commencing 1 May. Considering she is on the minimum wage this would be about 1/3 of her monthly salary which, I consider, is unreasonable to ask. Coupled with the fact she has just given notice to her current employer to leave to start her teacher training in September means at the end of May she will not have a paid income.
Any help or advice would be most appreciated.
Many thanks.
Rob Harris.
Submitted: 1 year ago.
Category: Law
Expert:  Ben Jones replied 1 year ago.
Hello does she agree she has been overpaid?
Customer: replied 1 year ago.
She does now having had it explained in a recent email, but at the time there was no indication it was an overpayment. ***** ***** did not query it at the time and she genuinely thought it was a tax rebate.
Expert:  Ben Jones replied 1 year ago.
Thank you. 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:{C}· The overpayments were made due to an error by the employer{C}· The employee genuinely believed they were entitled to the money, or did not even realise that they were being overpaid{C}· 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. This is your basic legal position. I have more detailed advice for you in terms of the rights she has if this was taken to court, which I wish to discuss so please take a second to leave a positive rating for the service so far (by selecting 3, 4 or 5 stars) and I can continue with that and answer any further questions you may have. Don’t worry, there I no extra cost and leaving a rating will not close the question and we can continue this discussion. Thank you
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Expert:  Ben Jones replied 1 year ago.
Thank you. As mentioned, there is nothing topping the employer from taking this to court because they have the right to pursue this if they believe she is genuinely overpaid. As the amount is quite low this will go to the small claims court. This is a venue intended for small matters where it is assumed most parties will be unrepresented so she is not required to have a lawyer. If she was to lose the case she will also not be required to pay the employer’s legal fees for making the claim. She can try and negotiate a repayment plan with them, using her current financial position as leverage to agree on a lower amount or longer repayment period. In the end if no resolution can be reached the court can order that and they will take into account her finances. It is best for her to try and persuade the employer now to agree on a plan, stating it is in the interest of both parties to do this amicable rather than waste time and money in court.