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I was laid off 6 weeks ago. Now my ex employer is asking me to pay for a payroll error, stating that not enough was taken out for medical benefits during my entire employment (18 months).

I am not sure if they can do this? What steps can I take to address this situation?

I'm in NJ.

  • No problem, everybody was new here at some point. I took an edit to your post to save it from being closed, but please edit it further to reflect what you really want to ask – DarkCygnus Sep 10 at 17:47
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    Do you have any paperwork stating what the per-paycheck medical deduction was supposed to be? How long are they claiming they did not withhold correctly, all 18 months? How much money are we talking about? I would fight $4000 a lot harder than $40. – spuck Sep 10 at 17:51
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    This likely belongs in Legal. – Julie in Austin Sep 10 at 23:28
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    Ignoring the communications is a good start. Maybe they won't try too hard. – Headblender Sep 11 at 19:06
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This question really belongs in Legal, and I'm not a lawyer, so this isn't legal advice.

You want to speak with an attorney because the length of time may have created a presumption that your withholding amount was correct. This isn't a case of being paid the wrong severance, or the amounts being incorrect after some recent change. This is 18 months of you being paid an amount with presumably no awareness on your part that you weren't paid correctly.

A lawyer will be able to give you guidance you can't get from SE.

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When you get hired, you're supposed to elect the benefits you want. They are supposed to mail you a copy of what you elected. Can you find this piece of paper? I think this will be critical since the paper will list out a price and you can compare that with your pay stubs. If they match, then that's all the proof you need.

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I am not sure if they can do this? What steps can I take to address this situation?

Save your employer's communication of error on their part for when you seek legal advice. IANAL but they have already admitted error on their part so it may be difficult for them to attempt force you to pay back anything. Keep in mind that they are responsible for calculating your pay and how much they withhold, not you. The fact that they did this throughout your entire employment helps your case as well. Talk to a lawyer and explain the situation.

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    Admission of an error does not mean they can't get money back. If they over paid you in error, they can get their money back just as you can get money owed if they underpaid you in error. "Entire employment" would carry more weight if it wasn't just 18 months. – cdkMoose Sep 10 at 18:49
  • @cdkMoose He may have a point. In the case where they over pay you, they would say you work X hours at a rate of Z, so they can correctly demonstrate that they over paid you. However, in the case of deductions, they'd have to prove that you agreed to these deductions, and that it was incorrectly applied. If they have nothing and simply said they made a mistake that you never agreed with, then the burden of proof is on them on why you must pay. – Dan Sep 13 at 13:56
  • @Dan I’m in NJ also and every employer I’ve had has provided me a summary of benefits including breakdown of contribution to benefits. If they did that and now produce an update that explains the error, I’m not sure how to fight that. Certainly if they never shared info, it gets murkier but also OP should have asked for that info at time if hire, I always do as part of considering the offer – cdkMoose Sep 13 at 16:13
  • @cdkMoose Yeah,t hat's what my answer is based on. I live a few states over from you but as far as I know every company will give you a benefit statement after the enrollment period ends to state your elected benefits and its price. When I was first hired, I also got the elected benefits statement with price breakdown. They usually mail it, so the OP has it, and if he has that and the price is what they agreed with, then it's on the employer to prove otherwise. But I don't see how or why the deductions would change as I never heard or seen that myself so I'm leaning towards a repayment. – Dan Sep 13 at 17:17

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