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My girlfriend left a job on good terms to work for a different company. Apparently the payroll manager (one person department, it’s a company of <100 employees) forgot to take her off the payroll because she’s still getting paid her old salary. Does she have a legal obligation to pay the money back or inform them of the error in any way?

Before you go calling her an awful person, the company stopped paying her bonuses without notice and for no declared reason, and she tried to ask about them and they blew her off. In the end she was “owed” about $3k (depending on how you qualify “owed” in terms of monthly and quarterly bonuses).

As of today they’ve paid her about $4k extra. Anyone have any legal expertise in this matter? If they put money in her account because of an employee’s incompetence, is that her responsibility? The company is in Missouri if that makes a difference.

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    Before you go calling her an awful person, the company stopped paying her bonuses without notice and for no declared reason... This is not legal advice but you might find this FAQ Regarding Furloughs and Other Reductions in Pay and Hours Worked useful. I recommend getting a lawyer if she wants to look into whether they were legally required to give her notice. The link may help with figuring out whether the bonus counts as salary.
    – BSMP
    Aug 15 '20 at 5:24
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    "The company stopped paying her bonuses". And? Bonuses are in addition to her salary/wages, and the company can likely stop paying a bonus for any reason they like, no explanation required.
    – chepner
    Aug 16 '20 at 17:42
  • Does this answer your question? My former employer is still paying me. What do I do?
    – mcknz
    Aug 16 '20 at 20:16
  • bonuses != salary. And goodness, watch the news lately? There might at least a couple reasons why a company might need to save some coin by not paying bonuses. Does it really need a press release?
    – NKCampbell
    Aug 16 '20 at 20:23
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I would suggest checking the pay stubs or whatever system tracks work hours. If she doesn't have access to any of that, contact the company for clarification of the situation. Communicating through email may be helpful to get their answer in writing in case things escalate to the point of needing a lawyer.

If the payments are cashing out accrued vacation time this may actually be the correct payout from the company. If the payments are for work weeks after she left then there may be a problem/mistake.

Whatever you do, do not spend the money until you know it's properly accounted for and not an accident. If the money was paid through direct deposit, it is possible the company will reverse accidental payments through direct deposit as well. You do not want a shock from a sudden massive withdrawal.

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Her employer has a legal right to reclaim the overpayment; see for example this Nolo article. Since she's no longer employed there it's probably a bit harder for them to actually take that money back (though if it was direct deposit, in some states they can simply pull it back directly from her account, so be careful!)

Given that they likely have years to reclaim the payment, even if you don't care about the morality of not reporting it, you're best off reporting it simply so that you don't end up with them taking back $4k or whatever in a year or two when you perhaps don't have it available and end up in money trouble because of it.

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This is no-brainer. Tell them. It is not your gf's money so she needs to return it. Her integrity is much more important than some unearned money.

I was in the same situation after a group of people got laid off. I told the company that they had mistakenly paid me.

I wrote something like this:

It appears you paid me for a full term of my pay check rather than my termination date. I will be happy to cooperate with you on getting this corrected.

They thanked me for the email and never contacted me about getting the money back.

My situation was similar in that I felt ripped off because they were not going to pay for my unused vacation time. They were within their legal rights to not pay for the vacation time even tho any normal person would think it was "not right".

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  • '...any normal person would think it was "not right"...' - what's "right" or not depends on company policy and applicable laws. My company never pays for unused vacation unless legally required to do so - and since I work at headquarters, in a state where they're not required to make such payments, they don't. My boss gets on my case about letting multiple weeks of vacation a year evaporate, but I figure that I live only fifteen minutes from the office (and under COVID protocols my home is my office!), and if I'm not there the work will just pile up, so why take vacation? Aug 16 '20 at 3:12
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    You are choosing not to take your vacation; what I am proposing as legal, but not fair is that if I save my vacation for Christmas but get laid off on Dec 1st I don't get paid for the vacation time. I don't think that is fair. Aug 16 '20 at 3:44
  • Your girlfriend shouldn't spend the money. Eventually, the accounting mistake will be discovered, and the money will have to be returned. In most cases you are free to keep the interest though.
    – Donald
    Aug 17 '20 at 18:11
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Your girlfriend should contact a local lawyer about this.

It may be that the company has paid this intentionally and not communicated well. It may also be that the company has done this by accident and is prepared to spare no expense in making someone else be responsible for their mistake.

A local lawyer will be able to tell her what the likely expectations and outcomes are once the former employer realises their mistake (which they eventually will), and can help her steer the situation to the best outcome for her.

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Similar situation happened in my friends case, he was payed a salary a month after he left. The company ended up communicating with the bank and a ticket was issued with the bank. The bank then called him for authorization to reverse the payment (in some states the banks dont need authorization).

I would advice that in your girlfriends case, wait to see if similar process happens. Remember, in either way if bank will reverse the payment, then she has no choice or if the bank require her authorization then she could challenge it with the claims that the company owes her unpaid bonuses (she would need to have a written proof, a contract or otherwise) that explicitly states the bonuses and the transition history showing the bonuses hasn't been paid to even consider challenging the reversal.

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Your girlfriend thinks that the company owes her $3,000 in unpaid bonuses and that they overpaid $4,000 salary when she didn't actually work anymore. And when she asked them to fix the problem with the bonuses and they blew her off.

The company absolutely has the right to get back money that they paid her and that shouldn't have been paid. However, she also has the right to the $3,000 that she is owed. Having the money in her bank account, she is in a strong position.

She should demand that the company tells her what they want to pay back, and she can demand that this takes money into account that she is owed. So if she gets a letter she should pay $4000 she can immediately reply that they didn't take her bonus payments into account and she doesn't pay until the amount is calculated correctly.

The company can't "blow her off" now. Normally if they do nothing about a bonus payment, you need to get a lawyer, take them to court etc. to get your money, all highly inconvenient. But now, they don't see their money back unless they calculate the bonus payments correctly or lie to her in writing. It's one thing not reacting and hoping she goes away, quite another thing to send her a written document that contains lies. That can be criminal, so they won't want to do this.

Anyway, don't spend the money, they can ask for it back for many years.

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    Unless you are a lawyer in the OP's local jurisdiction, this is a dangerous answer. We simply don't know that she "has the right to the £3,000 that she is owed"; even the OP used quote marks around the word "owed" - this might mean that it was verbally promised or implied, but with no contractual or legal obligation. In that case, keeping the money may be a criminal offence, depending on local laws. Perhaps you can add some evidence that your assertions in this answer carry weight in law? If not it should be treated with caution. Aug 15 '20 at 18:03
  • "However, she also has the right to the $3,000 that she is owed." - What right is that exactly? I didn't know the right of an optional bonus was an actual right employees had.
    – Donald
    Aug 17 '20 at 18:12

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