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I'm somewhat familiar with estoppel but I'd really like your thoughts on the situation.

Basically my previous employer wrote the wrong name on my leavers form, resulting in me being paid a full months wage as opposed to the 1 week I was due to be paid.

As soon as I noticed the additional funds in my account I contacted their payroll department via telephone and advised them of the error. A day later they called me back and advised me repayment had to be made asap. I queried the whereabouts of my P45 as I needed it for my new employer but they weren't able to provide me with it as they "would not have the facility available until payroll day." I made an agreement that upon the receipt of a correct P45 alongside relevant documentation corresponding to my employment at the company I.e. payslips, holidays booked etc. I have yet to receive said P45 (3 months after my call to them) however they are now constantly chasing me via email.

I appreciate I'll have to pay it back and although I have some funds, I cannot afford to pay it back in a lump sum, given my wage only supports me for basic living expenses alongside bills etc.

I'm just lost and I haven't any clue what to do. My current director (who is conveniently my old directors best friend) has told me to forget about it and keep the money as a float to support my finances, given my old boss is recognised by many as the type to take backhand deals and pay the majority of his expenses in cash.. (you can see what kind of director he is...)

Where do I stand?

  • just curious - what is estoppel ? – Adel Oct 6 '15 at 17:52
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    In my situation I'm assuming it means I cant bullshit my old employer and tell them I had no idea about the extra money - thus attempting to justify spending it, given I called them and advised an overpayment had been made. – Apathy Oct 6 '15 at 17:56
  • Ok, so can you elaborate on what you said here - appreciate I'll have to pay it back and although I have some funds, I cannot afford to pay it back in a lump sum, given my wage only supports me for basic living expenses alongside bills etc ... this seems to throw a wrench in the story I think. – Adel Oct 6 '15 at 18:02
  • Do you have a written agreement about the cash for p45 trade? – Mohair Oct 6 '15 at 18:04
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    @Adel see en.wikipedia.org/wiki/Estoppel - having agreed to delay repayment until the p45 is produced, the employer is estopped from demanding it without the p45. By the same token, having agreed to pay it back on getting the p45, Apathy is estopped from claiming to have no idea the overpayment ever happened. – Kate Gregory Oct 6 '15 at 21:11
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Every time they email you and ask for the money, reply and ask for the P45. Don't just ignore the email because you don't have the paperwork. Reply. Assuming it is ok for you to have made this demand in the first place, it must be ok for you to stick to your guns on it. But you know, they will eventually come up with the P45 and you will have to pay the money back. You should never have spent it - you knew from the moment you saw it that it wasn't yours to keep.

Start setting aside those payments now. Put the money in something that bears interest if you like. And when they finally either provide the form (that after 3 months it seems unlikely you need) or send you a stern lawyer letter saying the form and the money have nothing to do with each other and you need to pay it back now, you will have it saved up.

In the unlikely event that they tell you they will no longer be pursuing you for the money, you can celebrate by spending it. But if things are as tight as you say, I would advise you to celebrate by putting it into a rainy-day or retirement fund.

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    (You should speak to your union rep or lawyer but in the meantime) also make clear in your replies that you and they agreed that the money was due to be returned once you'd received the P45. It is entirely possible that their individual or collective memory has conveniently failed them on this point. – user52889 Oct 6 '15 at 21:01
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    You should never have spent it - you knew from the moment you saw it that it wasn't yours to keep. This sums it up well. Even if you desperately need it, it was never your money. To spend it is morally wrong and puts you into a very difficult situation when you will eventually be forced to pay it back. – Jane S Oct 6 '15 at 21:21
  • @JaneS: You wish. The bank sees the money in his account and can't understand its not his. – Joshua Jan 19 '16 at 20:49
  • @Joshua Excuse me? It's got nothing to do with the bank and everything to do with someone spending money that is not theirs. – Jane S Jan 19 '16 at 21:03
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    It doesn't work that way. Money that's not yours in your bank account is still seized for your debts. The money in your possession owned by your employer is just another debt as far as the financial systems are concerned. – Joshua Jan 19 '16 at 21:14

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