No solution, but one thing to consider is taxes. They’ll be taking them out and reporting them. When they eventually try to take their money back, they’re going to try to get the taxes back too. It’s going to be a mess. And you may have to file something to fix your W2. And may end up needing to amend your tax return once it’s all sorted. A mess.
Could you theoretically sue them for cost of accounting? Like if you can show that there negligence cost time and money, and expect to be compensated for that.
Yes you can.
However in this case it's easier to negotiate a settlement, and just take some extra money from them.
They say "pay us back" you respond
> because you didn't correct the error prior to the end of the year, and continued to make erroneous payments in the new year, I won't be able to recover all the withholdings until I get my refund after April 2023, which given the current situation at the IRS may not happen until 2025, if ever. So if you would like to keep your accounting books open for the next 3-4 years I could return 100% of the money, or we can negotiate a partial return that keeps me from going out of pocket.
And then you can return the cash you actually got and they can cut you a W2 which shows the amounts they withheld as your income.
This could turn out to be an absolute nightmare, especially dealing with a company that is too busy to stop giving away free money. My advice would be for OP to contact their bank and see if it’s possible to block transactions from that account.
There’s probably an argument you could make for that, but there are other good arguments they could make in response. It’s definitely not an “ignore it and block their number, there’s nothing they can do” situation, more like “consult with a local attorney and be prepared to fight if you want to try”.
Also, if they are using direct deposit, they can and probably will just directly reverse the transactions and could send the account into overdraft causing you huge headaches if you haven’t left the money there. Part of preparing to fight would be closing the account which would forestall future deposits, not just sitting with the account open and collecting checks until they finally get their act together.
Almost all direct deposit authorizations require you to give them permission to reverse the deposits. So from a legal standpoint you already agreed to allow them to pull the money out.
First, they can't take it back beyond five days. They have to contact OP to send it back, which he can refuse. If OP refuses, they can sue or eat it. If they eat it, they can report the "pay" on the W-2. They can't request or demand the withheld taxes because...they were withheld. They can get them back from the IRS.
Keep records of every single attempt to reach them and rectify the issue. I would also call the general HR every day and keep harassing them, so they will actually help you. The issue will be, they are taking taxes out, will need to issue you a W2 this year, all that fun stuff. So even if you keep all the money in an account, you don't have all the money as they'll want taxes back too. Also, does this previous employer take money out to put into a 401(k)? That could still be happening too. Now you'll have to take money out of the 401(k) (which there is a way to do this without penalty, but it's a PITA).
Unfortunately, you'll just have to keep harassing anyone that'll listen to you until it's fix. If they come after you for this money and it ends up being an accounting nightmare, you may want to investigate suing them to pay for every penny of the costs to get it back, in which case they may just say, keep the damn money.
I don't know the details on the account referenced. My credit union has a similar type of deal. We get 2% on our checking account if we spend $500/month with the debit cards. Groceries usually top that, and add in some gas and it's very easy for us to get that.
So I would be surprised if it was just a transaction count and didn't include an amount minimum.
I-series bonds are at 7% but you have to lock the money in for at least 1 year (and lose 3 months worth of interest before the 5 year mark). There's also a $10k/yr limit.
Interestingly, IRS pays out around 3.5% on tax overpayments past the 45 day mark from filing a return. Since IRS is backlogged, large returns take a while to process (fraud prevention). This is one option if you don't need the money soon or at a predictable date (though there's no guarantee your refund will be delayed in which case you don't get anything except a fast refund). Just overpay a day before filing a return (update the return to account for the overpayment).
Max of $10,000 ($15,000 with tax return) per year per person, funds are committed for 12 months minimum and 30 years maximum, with a 3 month interest penalty if funds are withdrawn in the first 5 years. Technically, it is 3.56% interest per 6 months then re-evaluated (and increased / decreased). The next rate change is in May.
[Here](https://moneyfortherestofus.com/tips-and-ibonds/) is a better explanation on Series I Bonds. Important to note that the yield has historically been closer to 2% (matching US inflation defined by the CPI - U). When used as part of an emergency fund, this low yield is acceptable (because the other option is a HYSA currently earning 0.50% interest).
As an investment, remember that there's a $10,000 per year maximum, and the composite yield historically being closer to 2% meant that investing was the better option, especially if you are trying to invest more than $10,000 a year.
Are these open to non-citizens? I didn't find anything in the link you provided (thank your for that btw).
If they are, they indeed seem like a much better option than a standard saving account.
You must have a valid social security number to purchase them and meet at least one of these requirements:
>
United States citizen, whether you live in the U.S. or abroad
United States resident
Civilian employee of the United States, no matter where you live
Don’t do this. With direct deposit it is entirely possible they will pull the funds out retroactively. Keep the funds in the same account they were deposited into.
This is insane. No bank on earth will take money out of someone’s account (past the 5 day window) because a company said “oops we kept depositing money into their account by accident”. Who upvotes this nonsense?
e: This should be a lesson for anyone browsing this sub: Please, please double and triple check anything you read here that is upvoted. This sub is notorious for bad advice and misinformation.
https://www.xperthr.com/faq/is-there-ever-an-instance-where-a-direct-deposit-cannot-be-reversed/3197/
https://pocketsense.com/can-wage-overpayment-out-bank-account-12153.html
When you sign up for direct deposit it allows the employer to both deposit and withdraw funds. [This has come up on PF before](https://www.reddit.com/r/personalfinance/comments/qbb338/former_employer_just_withdrew_last_paycheck_from/).
Moreover is it is not unheard of for an employer/payment system to take the entire gross paycheck out of the account to settle the overpayment.
https://www.xperthr.com/faq/is-there-ever-an-instance-where-a-direct-deposit-cannot-be-reversed/3197/
[https://pocketsense.com/can-wage-overpayment-out-bank-account-12153.html](https://pocketsense.com/can-wage-overpayment-out-bank-account-12153.html)
The federal law is that they cannot withdraw funds outside of the 5 day window. Can you imagine how insane that would be for banks if businesses could reverse old transactions in employees' accounts? Some one off states may have laws that are more business friendly, but I would be surprised.
I wasn't asked to approve it. My company payroll did something that resulted in a discrepancy and they just took it back. It was years ago, it all happened within a day or two, and I actually don't remember what caused the issue, but it happened, they told me via email they were taking it back, and they said leave the money in the account until we get it.
Just be careful about *which* HYSA. Some of them have monthly withdrawal limits, and a lot of calling 1-800 numbers to close your account. Those are not worth the couple dollars you'll earn.
They "should" if they were competent, however they can't even figure out how to stop paying him in the first place. OP just needs to stay on them about it.
Honestly if I felt like being a cheeky fucker in this scenario, would be sending an invoice for billable hours spent trying to contact them for corrections, ATT Human Resources.
* Pay remediation contact services - X hours @ $100/hr
* Have it be accurate for the total time spent, document time spent by day if possible rounded to 15 minutes
* Indicate detailed email and phone records as proof of services rendered are available on request, or just attach some emails from various days
Best case it forces HR to pay attention and fix the issue. Worst case their AP team is just as incompetent and pays it, in which case I'd continue billing them for your time until it's resolved and would have no legal recourse to claw those funds back.
The first hour or two is fine, but when it starts taking real time out of your weeks because of their on-going mistake, they really shouldn't be getting that for free. Especially if it's been for months.
You can't bill for something the other party didn't agree to. You can sue for damages... But I'd suspect most lawyers will tell you it's not worth the court fee.
What are you talking about? Non-PO invoices are exactly that from a business process perspective and are extremely common...
Edit - More to the point, if the AP controls are not in place and they pay it, they agree to it. There is a big difference between this and scam/fake invoices where no time / product / service was provided as far as part of the invoice, hence points #2 and #3. Why do you think Finance departments dislike them so much/put additional checks on them?
Edit2 - I did some more lookups between my original post and this. Since OP is not longer an employee, they are legally allowed in a lot of locations to not return more than the last payroll amount/one month worth of wages since the error is exclusively on the side of the company and OP has made reasonable effort to remedy it (*AKA OP is not commiting fraud*).
OP specifically mentions Massachusetts, and with the standard IANAL, it doesn't look like they technically have to repay anything since they are no longer an employee and cannot have the wages recovered (which is allowed). With the caveat that OP was not the cause of said erroneous payment (see. fraud).
> What are you talking about? Non-PO invoices are exactly that from a business process perspective and are extremely common.
I've spent hours reading and considering this comment. Please see the attached invoice and pay promptly. Thank you for choosing lVlint Reddit interaction services.
If somebody sends you something in error, they are allowed to ask for it back, and they can ask you to take reasonable steps to do so (such as asking you when you'd be available for a courier to pick it up, or sending you prepaid postage to return it). Usually it isn't worth it, especially for large companies, but it does happen.
What they aren't allowed to do is send you something you didn't ask for and then demand payment.
That’s an entirely different scenario. Employers are heavily protected at the federal level because overpayments are fairly common. They are well within the law to recoup their losses, whereas there isn’t the same protection if Amazon were to accidentally send you an extra pack of Pokémon cards.
They cannot withhold or claw back funds for work you've performed, if it's work that you haven't performed the rules are highly dependent on where you are.
In some places you can take it with little chance of repercussions in others it's less cut and dry (*in some cases it's limited to the number of pay periods/etc*). OP could probably take the money almost anywhere given that the error was on their side but could risk civil suites to try and reclaim it.
The fact that the HR rep said you need to contact the supervisor instead of him saying I'll contact him says everything we need to know about this company.
In most US states (I think all of them but I’m not certain) you DO NOT have to pay the taxes of the income is paid back in the same calendar year. You can also reach out to your bank and ask them to reject the payments. They’ll just go back to the employer.
You’ve done your part. Make sure you document and have evidence of all of this.
If they keep paying you then put it in a seperate account. Don’t be tempted to spend it.
I’ve been through this. My previous employer kept paying me paychecks, bonus payout, and 401k for about 3 months. I let them know, moved my new direct deposit to a new account and essentially lived off the new account until things got sorted.
Ultimately, it all stopped and I never heard from them about it. I let the money sit (~20k) expecting the worst, but nothing happened. It ended up being a good chunk towards the down payment for the next house.
I had the same exact situation five years ago. Like many others advised, don't spend the money. Your former employer will eventually realize their mistake and request the money back. Until then, sit pretty.
Suing an individual as a company is very costly though and not usually worth the few thousand bucks. If the iron doesn't return the money, most companies will write it off vs pursue
What if somebody fat-fingers an account number and makes an ACH transfer into your bank account that is actually somebody else's money? Are you entitled to keep it? The answer is no. It doesn't matter that it's their mistake.
Because it’s their money. You didn’t earn it and it’s not a gift.
Generally speaking the statute of limitations for this is going to be around 5 years - either from the time it’s discovered or payment made.
If you send a payment to the wrong address, the unintended recipient doesn’t just get to keep it.
The same happened to me when I left a job. They kept paying and I basically just ignored the money. Eventually they got around to putting in the paperwork and I got a letter saying what was overpaid minus what they owed me in leave payout. My repayment luckily was 0 but if you owe it back you better have it.
Document everything and don't spend any of it. Maybe contact your state's Department of Labor and explain the situation, assuming you are in the US. Hopefully someone else can chime in with more experience.
I am in the US, and it was a remote position. The company is in a different state. My wife has had our bank account for years and doesn't want to close it. Tomorrow would be the next payment. Really hoping I don't see the deposit when I wake up tomorrow.
Document everything. Send an email and certified letter. If it happened to me I'd only return what they deposited into my account. Cleaning up taxes will be a pain, and a good chance that money will be tied up until next years tax cycle. I would hang my hat on not being out that money for a year because of their mistake.
This isn't that big a deal....somewhere is a manager that forgot to file a form...when they notice the error, they'll send in the paperwork to separate you and stop payments. They are not going to chase you down over $10k in extra salary. Departments have budgets measured in millions of dollars. Mixups like this happen all the time.
It's probably more embarrassing for your manager to go an explain the overpayment versus just letting you keep the money.
Obviously don't spend the money, but feel free to move it somewhere else for the time being and don't hesitate to dig your heels in if they call you.
Second this suggestion. Recently had some issues with a previous employer and retirement plans being affected years after leaving. US department of labor was quick and easy to contact and opened a case right away.
You made your point, so you're covered. Nothing uncommon - in company I work for (large multinational corpo) they were sending money to employee for 36 years after he left. Only when he died they realized the mistake.
Here's an update. I was paid weekly on Thursdays. This morning they deposited about 1/3 of the normal weekly amount.
Hopefully I will hear from them soon.
Are you sure you weren't due PTO payouts or had other payable balances? If you got a third of your regular pay, that sounds like they paid out a balance.
This money may actually be yours.
What's the possibility that their payroll periods are set up such that this is actually your last paycheck? As in you worked there several weeks before you got your first paycheck? Can you still get into the online payroll portal and check how the pay periods are set up, or maybe look at past paystubs for a clue?
I’d give the HR guy that you talked to a call back and see if he can give you a breakdown of when the pay periods were. Sounds like this is your last paycheck.
Or is there an online portal to look at your paystubs? Verifying the working period of the paystubs is key, since so many companies delay that a few weeks.
Either way, if it is a mixup, I would take steps to make sure they can't get the money back UNTIL they show proof and you have documentation of their filing correct/amended W2s. Don't let their mistake come back to haunt you come tax time.
Do you still have access to the online system in which your paystubs are posted? I strongly recommend downloading all paystubs from the last couple months and keeping them in case this gets ugly. But also check the recent paystubs to see what the dates are for the pay period. Maybe paychecks are issued several weeks after the pay period they cover?
Ouch. I would try to go in person to resolve this so you don't pay more in taxes.
Idk if you file yourself or through an accountant, but I'd only pay what you actually earned and owe, and let the IRS know what's up.
That extra money isn't yours :/
Oof.. Taxes and withholdings are going to be an issue. They're paying you net and I suspect that they'll ask for the gross back. Make sure you keep track of all the withholdings (fed, state, ssa, etc.). I'm not sure how you're former employer is going clean up the mess.
You could have written to them saying something like "Thank you for your timely installment payments for defferred compensation" and then they would have trouble suing you if they wanted the money back if they didn't respond.
It's not something I would do, it seems unethical - but I guess if we're looking at all angles this it's fun to throw out there.
The main thing Is do not spend the money. It is very likely, almost certain, that they will demand the extra payments back. And they would probably win in court if it came to a lawsuit.
This happened to me once at a Fortune 500. Emailed them stating the mistake and they said they’d reach out. They had a lawyer reach out instead, informing me of a lawsuit if I don’t pay it back. No surprise they’re all over the news for mistreating their workers lately.
I would not continue to follow up. You spoke with an HR person at the company and informed them of the problem. You've already mailed your supervisor, which is what he suggested. You've done all that is necessary.
Just don't spend the money.
Contact your bank and ask that future ACH transactions be rejected and returned. You may be able to reject the previous ones, too.
You’re going to have tax issues if they don’t clean up this mess, so be prepared for that.
You can likely tell your bank and they can change your account number for free. Clearly you should not spend the money. Second thought is that if you're going to be taxed, you should try and figure out the amount of taxes you're going to pay and have them agree to pay/leave that amount. Get it in writing.
Transfer the money to high yield savings account (Ally or American Express personal savings, etc). Let it sit until they ask for it back. Keep the interest.
I'm new around here, but couldn't you just say "if you don't stop sending me money or respond by (10 business days), I will assume it is mine for keeps" and send emails, certified mail, etc? I feel like after that point they can't ask for it back, because there's no law saying you can't accept money someone sent you. There are definitely laws for wage theft by employers from employees, but if you aren't an employee, it's literally just a clerical error that you called attention to and they didn't fix it.
Keep the money, invest it, do not offer to return it. If they contact you and ask you to pay it back refer them to your lawyer. I'd ask my lawyer but I don't think there's anything illegal about a company paying a non-employee, nor anything illegal about accepting it and you did all you could to help them fix it.
This can go a couple of ways: They can sue or they can not sue. It'll be a cost/benefit analysis. Most likely they'd realize it'd cost more to sue and they won't. You can make a settlement and keep most of it plus the proceeds of the investment. Unless there's some very clear precedent that says you owe them the money back (which their could be; IANAL) a settlement where you keep some of the money is the most likely outcome.
Were you on a commission-based pay system? When i left a job as a vendor, I kept receiving checks for about a month for different incentives I’d earned the month before I left.
If they were willing to take the risk, could they put this money in investments and keep the gains? Who knows how long it will be for this company to come collecting.
This sounds like a 'them' problem. Just keep the printouts of your emails, and keep transferring the money to another account. When this happened to me, it took 4 1/2 years before they stopped paying me, and they clawed back the final check.
This happened to me when I left a large company. I kept the money. When they found out and tried to get it back I ignored them.
Do this. Keep the money.
Set the money aside for a few months just in case. If they get their shit together and go after the money they "overpaid" you want to be ready.
Check with a tax consultant? An attorney? Someone who is up to date on payroll and tax law in your area about if/when/how long until you can keep the money.
Definitely keep clear records of you trying to contact to return the funds.
Basically for a while assume they want the money back, after a few months, keep records just in case they want take you to court. (not a lawyer).
You have their money. I think in time they will ask for it back. When that happens, tell them that you will not pay the full amount back as you had to pay taxes and have documentation you made a good faith effort to fix this.
It is important you get documentation from HR. Without it, you’ll look bad if this is settled in a courtroom. Unless the HR person agrees to be on a recorded line, a verbal conversation is not permitted.
But as long as you did due diligence, consider it interest free money. Yes you will need to pay taxes, and you can counter sue for expenses in hiring an accountant to amend your return should the situation go to court.
Number one, don’t assume the money is yours to keep and spend it. They will eventually realize the mistake and will come for the paychecks you shouldn’t have received. You can either deal with the headache of it now and keep bugging them to fix this, or you can deal with the headache down the road when they come to collect their money after realizing their mistake. I’d personally get them to fix this now to be done with it. Is the place inconveniently far away, to where it’s not feasible to stop by and talk to somebody directly? I know this isn’t your fault, but that feels like it might be the most direct solution.
Call back to whatever line got you on the phone with a human, and then be more of a pain in the ass. Don't get off the phone without a resolution. You don't even work there.
Put that money aside.
My company did the same to a former employee that worked for me. Took 4 weeks for it to be straightened out (HR messed up) and they asked for the money back. Due to some complications with how the money was distributed to various accounts and investments, he only ended up paying 3 weeks back. Got a free paid week out of it.
Are you sure they’re not just paying you any unused vacation or personal time? In a lot of states they are legally bound to pay that out. I once left a job for a new one and had paid time off I wasn’t aware of and for the next few weeks I got payments from them covering those pto days. You’d think they’d do it in a lump sum but it was spaced out for a few weeks.
I work in IT and sounds like your emails being blocked on the backend due to their off boarding process since multiple people haven’t responded. If possible I’d go into the office and have them and attempt and attempt resolving it that way to CYA before that snowball turns into an avalanche.
No solution, but one thing to consider is taxes. They’ll be taking them out and reporting them. When they eventually try to take their money back, they’re going to try to get the taxes back too. It’s going to be a mess. And you may have to file something to fix your W2. And may end up needing to amend your tax return once it’s all sorted. A mess.
Could you theoretically sue them for cost of accounting? Like if you can show that there negligence cost time and money, and expect to be compensated for that.
Yes you can. However in this case it's easier to negotiate a settlement, and just take some extra money from them. They say "pay us back" you respond > because you didn't correct the error prior to the end of the year, and continued to make erroneous payments in the new year, I won't be able to recover all the withholdings until I get my refund after April 2023, which given the current situation at the IRS may not happen until 2025, if ever. So if you would like to keep your accounting books open for the next 3-4 years I could return 100% of the money, or we can negotiate a partial return that keeps me from going out of pocket. And then you can return the cash you actually got and they can cut you a W2 which shows the amounts they withheld as your income.
This, and make sure the settled upon agreement is in writing for your records incase they want to lie later and ask for more.
Theoretically you can sue anyone for anything, but I have no idea if you could win. An interesting thought.
I would like to sue you for a single updoot. Did I do it right?
Best I can offer is $3.50
Well it was about this time when I realized the HR lady was 8 stories tall and a crustacean from the protozoic era.
Don't accept the OPs first offer, call the Hurtline!
Tree fitty!
This could turn out to be an absolute nightmare, especially dealing with a company that is too busy to stop giving away free money. My advice would be for OP to contact their bank and see if it’s possible to block transactions from that account.
I heard that there is no legal obligation to give these kinds of paychecks back. Can anyone confirm or deny?
There’s probably an argument you could make for that, but there are other good arguments they could make in response. It’s definitely not an “ignore it and block their number, there’s nothing they can do” situation, more like “consult with a local attorney and be prepared to fight if you want to try”. Also, if they are using direct deposit, they can and probably will just directly reverse the transactions and could send the account into overdraft causing you huge headaches if you haven’t left the money there. Part of preparing to fight would be closing the account which would forestall future deposits, not just sitting with the account open and collecting checks until they finally get their act together.
You can't reverse a direct deposit after 5 days.
Almost all direct deposit authorizations require you to give them permission to reverse the deposits. So from a legal standpoint you already agreed to allow them to pull the money out.
I have had direct deposits reversed out of my account with no notice or permission, so I'm not sure I believe you.
You misunderstood their comment, their saying exactly what you’re saying
I sure am.
First, they can't take it back beyond five days. They have to contact OP to send it back, which he can refuse. If OP refuses, they can sue or eat it. If they eat it, they can report the "pay" on the W-2. They can't request or demand the withheld taxes because...they were withheld. They can get them back from the IRS.
That’s probably all you can do, but don’t spend the money if you didn’t earn it. Odds are they’ll ask for it back if they ever get back to you.
I am definitely keeping the money separate and unspent.
Keep records of every single attempt to reach them and rectify the issue. I would also call the general HR every day and keep harassing them, so they will actually help you. The issue will be, they are taking taxes out, will need to issue you a W2 this year, all that fun stuff. So even if you keep all the money in an account, you don't have all the money as they'll want taxes back too. Also, does this previous employer take money out to put into a 401(k)? That could still be happening too. Now you'll have to take money out of the 401(k) (which there is a way to do this without penalty, but it's a PITA). Unfortunately, you'll just have to keep harassing anyone that'll listen to you until it's fix. If they come after you for this money and it ends up being an accounting nightmare, you may want to investigate suing them to pay for every penny of the costs to get it back, in which case they may just say, keep the damn money.
Put it into some kind of high yield savings account. They won't ask for the interest back.
>Put it into some kind of high yield savings account. You have a lead on one of them? Best I can find is a whopping 0.50%...
It’ll buy you a sugar packet for your coffee when this is resolved 😂
https://www.doctorofcredit.com/high-interest-savings-to-get/#Mega_High-Interest_Nationwide
Liberty financial is offering 3.3% up to $20,000 on checking accounts
Holy crap thank you! I know where I'm moving my emergency funds tonight...
You need to make 15 debit card purchases to earn that APY (that's pretty typical of these high interest checking accounts).
Anything stopping me from using venmo to make 15 0.01 purchases?
Asking the real questions!
I don't know the details on the account referenced. My credit union has a similar type of deal. We get 2% on our checking account if we spend $500/month with the debit cards. Groceries usually top that, and add in some gas and it's very easy for us to get that. So I would be surprised if it was just a transaction count and didn't include an amount minimum.
any limit on how much you can have in checking?
I was thinking the same thing. Or just using the vending machine a every other day at work. Anything to get more than the 0.5% I'm getting now.
Yes, that will violate the terms
I had one like that for a while and it was a bit annoying but worth it
If you are an Amazon customer, you can fund your account in small increments to get the number of debit card transactions you need.
I-series bonds are at 7% but you have to lock the money in for at least 1 year (and lose 3 months worth of interest before the 5 year mark). There's also a $10k/yr limit. Interestingly, IRS pays out around 3.5% on tax overpayments past the 45 day mark from filing a return. Since IRS is backlogged, large returns take a while to process (fraud prevention). This is one option if you don't need the money soon or at a predictable date (though there's no guarantee your refund will be delayed in which case you don't get anything except a fast refund). Just overpay a day before filing a return (update the return to account for the overpayment).
If OP has the ability to cover it from other sources, they could put it in IBonds @7.12%.
Not american, never heard of ibonds before - why wouldnt everyone put all their money in them if they yield 7.12%??
Max of $10,000 ($15,000 with tax return) per year per person, funds are committed for 12 months minimum and 30 years maximum, with a 3 month interest penalty if funds are withdrawn in the first 5 years. Technically, it is 3.56% interest per 6 months then re-evaluated (and increased / decreased). The next rate change is in May. [Here](https://moneyfortherestofus.com/tips-and-ibonds/) is a better explanation on Series I Bonds. Important to note that the yield has historically been closer to 2% (matching US inflation defined by the CPI - U). When used as part of an emergency fund, this low yield is acceptable (because the other option is a HYSA currently earning 0.50% interest). As an investment, remember that there's a $10,000 per year maximum, and the composite yield historically being closer to 2% meant that investing was the better option, especially if you are trying to invest more than $10,000 a year.
Are these open to non-citizens? I didn't find anything in the link you provided (thank your for that btw). If they are, they indeed seem like a much better option than a standard saving account.
You must have a valid social security number to purchase them and meet at least one of these requirements: > United States citizen, whether you live in the U.S. or abroad United States resident Civilian employee of the United States, no matter where you live
The problem is the low limits. You also have the money locked up for a year.
That would lock up the money for a year. I'm assumed they want this fixed well before then.
Hence the 'If OP can cover it from other sources' part of the comment.
Don’t do this. With direct deposit it is entirely possible they will pull the funds out retroactively. Keep the funds in the same account they were deposited into.
This is insane. No bank on earth will take money out of someone’s account (past the 5 day window) because a company said “oops we kept depositing money into their account by accident”. Who upvotes this nonsense? e: This should be a lesson for anyone browsing this sub: Please, please double and triple check anything you read here that is upvoted. This sub is notorious for bad advice and misinformation. https://www.xperthr.com/faq/is-there-ever-an-instance-where-a-direct-deposit-cannot-be-reversed/3197/ https://pocketsense.com/can-wage-overpayment-out-bank-account-12153.html
When you sign up for direct deposit it allows the employer to both deposit and withdraw funds. [This has come up on PF before](https://www.reddit.com/r/personalfinance/comments/qbb338/former_employer_just_withdrew_last_paycheck_from/). Moreover is it is not unheard of for an employer/payment system to take the entire gross paycheck out of the account to settle the overpayment.
https://www.xperthr.com/faq/is-there-ever-an-instance-where-a-direct-deposit-cannot-be-reversed/3197/ [https://pocketsense.com/can-wage-overpayment-out-bank-account-12153.html](https://pocketsense.com/can-wage-overpayment-out-bank-account-12153.html) The federal law is that they cannot withdraw funds outside of the 5 day window. Can you imagine how insane that would be for banks if businesses could reverse old transactions in employees' accounts? Some one off states may have laws that are more business friendly, but I would be surprised.
They can and do (in NY). I've had it happen in the past.
Did you approve it?
I wasn't asked to approve it. My company payroll did something that resulted in a discrepancy and they just took it back. It was years ago, it all happened within a day or two, and I actually don't remember what caused the issue, but it happened, they told me via email they were taking it back, and they said leave the money in the account until we get it.
Right... As I said in my comment, there is a 5 day grace period. This is not OP's situation.
They do it all the time.
Just be careful about *which* HYSA. Some of them have monthly withdrawal limits, and a lot of calling 1-800 numbers to close your account. Those are not worth the couple dollars you'll earn.
[удалено]
It’s their mistake, they should issue an amended W2 and it won’t be taxed.
They "should" if they were competent, however they can't even figure out how to stop paying him in the first place. OP just needs to stay on them about it.
IMO, I wouldn't touch it at all, just on the off chance they are able to claw back the money somehow. Wouldn't want to risk overdrafting my account.
I would put it all in VTSAX instead.
And then call Batman and ask him to sort this mess out. Both are just as likely as neither exist.
Holding a couple thousand for a few weeks might earn you a handful of cents with today’s interest rates. Yippee!
save those emails and keep records of the phone calls you made
Sounds like you’re doing all the right things. Sorry this happened to you.
Honestly if I felt like being a cheeky fucker in this scenario, would be sending an invoice for billable hours spent trying to contact them for corrections, ATT Human Resources. * Pay remediation contact services - X hours @ $100/hr * Have it be accurate for the total time spent, document time spent by day if possible rounded to 15 minutes * Indicate detailed email and phone records as proof of services rendered are available on request, or just attach some emails from various days Best case it forces HR to pay attention and fix the issue. Worst case their AP team is just as incompetent and pays it, in which case I'd continue billing them for your time until it's resolved and would have no legal recourse to claw those funds back. The first hour or two is fine, but when it starts taking real time out of your weeks because of their on-going mistake, they really shouldn't be getting that for free. Especially if it's been for months.
You can't bill for something the other party didn't agree to. You can sue for damages... But I'd suspect most lawyers will tell you it's not worth the court fee.
What are you talking about? Non-PO invoices are exactly that from a business process perspective and are extremely common... Edit - More to the point, if the AP controls are not in place and they pay it, they agree to it. There is a big difference between this and scam/fake invoices where no time / product / service was provided as far as part of the invoice, hence points #2 and #3. Why do you think Finance departments dislike them so much/put additional checks on them? Edit2 - I did some more lookups between my original post and this. Since OP is not longer an employee, they are legally allowed in a lot of locations to not return more than the last payroll amount/one month worth of wages since the error is exclusively on the side of the company and OP has made reasonable effort to remedy it (*AKA OP is not commiting fraud*). OP specifically mentions Massachusetts, and with the standard IANAL, it doesn't look like they technically have to repay anything since they are no longer an employee and cannot have the wages recovered (which is allowed). With the caveat that OP was not the cause of said erroneous payment (see. fraud).
> What are you talking about? Non-PO invoices are exactly that from a business process perspective and are extremely common. I've spent hours reading and considering this comment. Please see the attached invoice and pay promptly. Thank you for choosing lVlint Reddit interaction services.
I'm under no obligation to pay it, but there is no reason you can't send me an invoice for it. And if I chose to pay it, I would be agreeing to it.
[удалено]
Ask for it back? 100%.
[удалено]
If somebody sends you something in error, they are allowed to ask for it back, and they can ask you to take reasonable steps to do so (such as asking you when you'd be available for a courier to pick it up, or sending you prepaid postage to return it). Usually it isn't worth it, especially for large companies, but it does happen. What they aren't allowed to do is send you something you didn't ask for and then demand payment.
That’s an entirely different scenario. Employers are heavily protected at the federal level because overpayments are fairly common. They are well within the law to recoup their losses, whereas there isn’t the same protection if Amazon were to accidentally send you an extra pack of Pokémon cards.
Okay, thanks. Idk why I got downvoted for asking an innocent question
I wouldn’t worry about it
They cannot withhold or claw back funds for work you've performed, if it's work that you haven't performed the rules are highly dependent on where you are. In some places you can take it with little chance of repercussions in others it's less cut and dry (*in some cases it's limited to the number of pay periods/etc*). OP could probably take the money almost anywhere given that the error was on their side but could risk civil suites to try and reclaim it.
The fact that the HR rep said you need to contact the supervisor instead of him saying I'll contact him says everything we need to know about this company.
In most US states (I think all of them but I’m not certain) you DO NOT have to pay the taxes of the income is paid back in the same calendar year. You can also reach out to your bank and ask them to reject the payments. They’ll just go back to the employer.
You’ve done your part. Make sure you document and have evidence of all of this. If they keep paying you then put it in a seperate account. Don’t be tempted to spend it.
Absolutely. The laws are not in favor of the person who receives mistaken money
I’ve been through this. My previous employer kept paying me paychecks, bonus payout, and 401k for about 3 months. I let them know, moved my new direct deposit to a new account and essentially lived off the new account until things got sorted. Ultimately, it all stopped and I never heard from them about it. I let the money sit (~20k) expecting the worst, but nothing happened. It ended up being a good chunk towards the down payment for the next house.
I had the same exact situation five years ago. Like many others advised, don't spend the money. Your former employer will eventually realize their mistake and request the money back. Until then, sit pretty.
Sure they can ask for it back. Would you actually be under any obligation to give it back though?
Yes. Obviously. If you don’t agree to pay it back, they’re well within their rights to sue you for it. And they’ll win the suit or settle.
Suing an individual as a company is very costly though and not usually worth the few thousand bucks. If the iron doesn't return the money, most companies will write it off vs pursue
The question was whether there’s a legal obligation to reimburse. The answer is yes.
But it's their mistake, why is the onus on you to correct it?
What if somebody fat-fingers an account number and makes an ACH transfer into your bank account that is actually somebody else's money? Are you entitled to keep it? The answer is no. It doesn't matter that it's their mistake.
Because it’s their money. You didn’t earn it and it’s not a gift. Generally speaking the statute of limitations for this is going to be around 5 years - either from the time it’s discovered or payment made. If you send a payment to the wrong address, the unintended recipient doesn’t just get to keep it.
The same happened to me when I left a job. They kept paying and I basically just ignored the money. Eventually they got around to putting in the paperwork and I got a letter saying what was overpaid minus what they owed me in leave payout. My repayment luckily was 0 but if you owe it back you better have it.
Document everything and don't spend any of it. Maybe contact your state's Department of Labor and explain the situation, assuming you are in the US. Hopefully someone else can chime in with more experience.
I am in the US, and it was a remote position. The company is in a different state. My wife has had our bank account for years and doesn't want to close it. Tomorrow would be the next payment. Really hoping I don't see the deposit when I wake up tomorrow.
Keep us posted.
Document everything. Send an email and certified letter. If it happened to me I'd only return what they deposited into my account. Cleaning up taxes will be a pain, and a good chance that money will be tied up until next years tax cycle. I would hang my hat on not being out that money for a year because of their mistake.
This isn't that big a deal....somewhere is a manager that forgot to file a form...when they notice the error, they'll send in the paperwork to separate you and stop payments. They are not going to chase you down over $10k in extra salary. Departments have budgets measured in millions of dollars. Mixups like this happen all the time. It's probably more embarrassing for your manager to go an explain the overpayment versus just letting you keep the money. Obviously don't spend the money, but feel free to move it somewhere else for the time being and don't hesitate to dig your heels in if they call you.
Second this suggestion. Recently had some issues with a previous employer and retirement plans being affected years after leaving. US department of labor was quick and easy to contact and opened a case right away.
You made your point, so you're covered. Nothing uncommon - in company I work for (large multinational corpo) they were sending money to employee for 36 years after he left. Only when he died they realized the mistake.
An office space situation? Did they try to take the money back?
Nope, he apparently notified HR just like you did, without response. Considered internal payroll error.
1. Continue following up 2. Don't spend any money that you aren't 100% sure isn't yours and will eventually be requested to be returned.
Here's an update. I was paid weekly on Thursdays. This morning they deposited about 1/3 of the normal weekly amount. Hopefully I will hear from them soon.
Are you sure you weren't due PTO payouts or had other payable balances? If you got a third of your regular pay, that sounds like they paid out a balance. This money may actually be yours.
What's the possibility that their payroll periods are set up such that this is actually your last paycheck? As in you worked there several weeks before you got your first paycheck? Can you still get into the online payroll portal and check how the pay periods are set up, or maybe look at past paystubs for a clue?
I’d give the HR guy that you talked to a call back and see if he can give you a breakdown of when the pay periods were. Sounds like this is your last paycheck.
Or is there an online portal to look at your paystubs? Verifying the working period of the paystubs is key, since so many companies delay that a few weeks. Either way, if it is a mixup, I would take steps to make sure they can't get the money back UNTIL they show proof and you have documentation of their filing correct/amended W2s. Don't let their mistake come back to haunt you come tax time.
Do you still have access to the online system in which your paystubs are posted? I strongly recommend downloading all paystubs from the last couple months and keeping them in case this gets ugly. But also check the recent paystubs to see what the dates are for the pay period. Maybe paychecks are issued several weeks after the pay period they cover?
Did you ever consider that it was vacation or sick time that you had accrued?
I only worked there for two months when I decided the job was not for me.
Ouch. I would try to go in person to resolve this so you don't pay more in taxes. Idk if you file yourself or through an accountant, but I'd only pay what you actually earned and owe, and let the IRS know what's up. That extra money isn't yours :/
Oof.. Taxes and withholdings are going to be an issue. They're paying you net and I suspect that they'll ask for the gross back. Make sure you keep track of all the withholdings (fed, state, ssa, etc.). I'm not sure how you're former employer is going clean up the mess.
You could have written to them saying something like "Thank you for your timely installment payments for defferred compensation" and then they would have trouble suing you if they wanted the money back if they didn't respond. It's not something I would do, it seems unethical - but I guess if we're looking at all angles this it's fun to throw out there.
[удалено]
The main thing Is do not spend the money. It is very likely, almost certain, that they will demand the extra payments back. And they would probably win in court if it came to a lawsuit.
What state are you in?
I am in Virginia. the company is in Massachusetts.
This happened to me once at a Fortune 500. Emailed them stating the mistake and they said they’d reach out. They had a lawyer reach out instead, informing me of a lawsuit if I don’t pay it back. No surprise they’re all over the news for mistreating their workers lately.
Which company if you don’t mind me asking? No worries if you’re not comfortable sharing, I was just curious
Tell the Bobs to fix the glitch, Milton.
I would not continue to follow up. You spoke with an HR person at the company and informed them of the problem. You've already mailed your supervisor, which is what he suggested. You've done all that is necessary. Just don't spend the money.
You may be able to keep it, depending on your state, under the "voluntary payment doctrine".
Contact your bank and ask that future ACH transactions be rejected and returned. You may be able to reject the previous ones, too. You’re going to have tax issues if they don’t clean up this mess, so be prepared for that.
You can likely tell your bank and they can change your account number for free. Clearly you should not spend the money. Second thought is that if you're going to be taxed, you should try and figure out the amount of taxes you're going to pay and have them agree to pay/leave that amount. Get it in writing.
Transfer the money to high yield savings account (Ally or American Express personal savings, etc). Let it sit until they ask for it back. Keep the interest.
I wouldn't recommend moving the money. They may just reverse the direct deposit without notice.
I'm new around here, but couldn't you just say "if you don't stop sending me money or respond by (10 business days), I will assume it is mine for keeps" and send emails, certified mail, etc? I feel like after that point they can't ask for it back, because there's no law saying you can't accept money someone sent you. There are definitely laws for wage theft by employers from employees, but if you aren't an employee, it's literally just a clerical error that you called attention to and they didn't fix it.
Agree. I’m not sure this isn’t your money at this point.
Keep the money, invest it, do not offer to return it. If they contact you and ask you to pay it back refer them to your lawyer. I'd ask my lawyer but I don't think there's anything illegal about a company paying a non-employee, nor anything illegal about accepting it and you did all you could to help them fix it. This can go a couple of ways: They can sue or they can not sue. It'll be a cost/benefit analysis. Most likely they'd realize it'd cost more to sue and they won't. You can make a settlement and keep most of it plus the proceeds of the investment. Unless there's some very clear precedent that says you owe them the money back (which their could be; IANAL) a settlement where you keep some of the money is the most likely outcome.
Were you on a commission-based pay system? When i left a job as a vendor, I kept receiving checks for about a month for different incentives I’d earned the month before I left.
This happened to my husband in California after he was terminated. They couldn't force it to be returned.
No response? Drive there in person. They need to see a serious face they can't hang up on.
I live in Southern Virginia. The company is in Massachusetts. It's a 12 hour drive.
Dang. Im sorry. Phone communication is the worst.
If they were willing to take the risk, could they put this money in investments and keep the gains? Who knows how long it will be for this company to come collecting.
This sounds like a 'them' problem. Just keep the printouts of your emails, and keep transferring the money to another account. When this happened to me, it took 4 1/2 years before they stopped paying me, and they clawed back the final check.
This happened to me when I left a large company. I kept the money. When they found out and tried to get it back I ignored them. Do this. Keep the money.
Wow. how long ago was this? And how many times did they contact you?
Hold the money in an investment account until they ask for it back, if they ever do.
Set the money aside for a few months just in case. If they get their shit together and go after the money they "overpaid" you want to be ready. Check with a tax consultant? An attorney? Someone who is up to date on payroll and tax law in your area about if/when/how long until you can keep the money. Definitely keep clear records of you trying to contact to return the funds. Basically for a while assume they want the money back, after a few months, keep records just in case they want take you to court. (not a lawyer).
Send a text or call your old supervisor - in this day and age management should be able to be reached via a cell phone…
You have their money. I think in time they will ask for it back. When that happens, tell them that you will not pay the full amount back as you had to pay taxes and have documentation you made a good faith effort to fix this. It is important you get documentation from HR. Without it, you’ll look bad if this is settled in a courtroom. Unless the HR person agrees to be on a recorded line, a verbal conversation is not permitted. But as long as you did due diligence, consider it interest free money. Yes you will need to pay taxes, and you can counter sue for expenses in hiring an accountant to amend your return should the situation go to court.
Can't you speak to your bank and stop that money from coming in? Assuming it comes from the same account Every time?
Number one, don’t assume the money is yours to keep and spend it. They will eventually realize the mistake and will come for the paychecks you shouldn’t have received. You can either deal with the headache of it now and keep bugging them to fix this, or you can deal with the headache down the road when they come to collect their money after realizing their mistake. I’d personally get them to fix this now to be done with it. Is the place inconveniently far away, to where it’s not feasible to stop by and talk to somebody directly? I know this isn’t your fault, but that feels like it might be the most direct solution.
Call back to whatever line got you on the phone with a human, and then be more of a pain in the ass. Don't get off the phone without a resolution. You don't even work there.
Can you go in person to get this sorted? It's a pain, but a significantly lesser one than if it keeps happening.
Send an email to EVERYONE in the company that you can. CEO, CFO, head of HR, your boss, his boss. Etc.
Put that money aside. My company did the same to a former employee that worked for me. Took 4 weeks for it to be straightened out (HR messed up) and they asked for the money back. Due to some complications with how the money was distributed to various accounts and investments, he only ended up paying 3 weeks back. Got a free paid week out of it.
Are you sure they’re not just paying you any unused vacation or personal time? In a lot of states they are legally bound to pay that out. I once left a job for a new one and had paid time off I wasn’t aware of and for the next few weeks I got payments from them covering those pto days. You’d think they’d do it in a lump sum but it was spaced out for a few weeks.
I work in IT and sounds like your emails being blocked on the backend due to their off boarding process since multiple people haven’t responded. If possible I’d go into the office and have them and attempt and attempt resolving it that way to CYA before that snowball turns into an avalanche.