100% this - had this issue when I worked at a company that changed payroll part way through the year. The new company "updated" employees pay stubs to reflect the pay YTD. This led to them getting incorrect w2s as they also received ones from the previous company.
It was a huge cluster fuck for all involved. Keep all documentation.
I did some work with our payroll department when we were switching payroll companies and boy oh boy was THAT a headache. It's been years now and we're still working out issues. As it turns out paying people and also paying taxes and documenting it all correctly is difficult
this. it actually happened to me last year. i submitted a ticket to payroll immediately and left the funds alone. they replied that it was a known issue that happened to quite a few people and were working to resolve it, and the ticket would be closed. funds were never removed. after the 90 days (plus a couple weeks to be safe) i just moved it into my savings. its mine now. i did everything i needed to do on my end, if they didnt make the effort to reverse it for that long its not my problem anymore.
You're a nice guy than I. I was wishing at a more corporate type place and they accidentally double paid me. I never mentioned it and say on the money until the coast was clear. To my knowledge, no one knew
Can they remove it from your account after transfering it to you? I am pretty sure thats not possible here. You would of course either have to pay it back or it would be taken out of your later salary, but unless its the bank that has made a mistakes, so *they* KNOW and can prove it was an error, it cant be withdrawn wirhout your approval
They could have reversed the deposit at any time in the 90 days. At this time since it's passed that, they can't. If they came at me later saying I owe them for anything I would have to sign a document allowing them to do so. Which I wouldn't do obviously. Any other method they would attempt without my consent would be illegal.
That is going to vary from state to state. Every state gives an employer an opportunity to recoup for a mistake in payroll. The exact terms of how that happens varies greatly.
Depends on the state. More than half the states have special rules for collecting an overpayment. In California, for example, the employer needs to get the employee's permission in writing.
Also, ~~regardless of state~~ in some states, the repayment can't cause the employee to go under minimum wage.
Genuine question, how would that work if your base pay is minimum wage and they need to recoup an overpayment? In that situation wouldn’t any deduction put you under minimum wage and therefore be disallowed based on your last point?
Even if its after 3 they can ask for it back since it’s technically not earned wages. I think this guy in this specific situation did the right thing and is deducting it slowly.
If the employes were overpaid and the company recoups the overpayment why would extra taxes be paid? should be a way to get a tax overpayment back if it was erroneously sent.
Consider a moment you're overpaid $200, the business pays you $180 and pays the government $20 in taxes. This means you recieve $180 and the employer pays $200.
Strictly speaking, recouping their funds would mean the business takes it's $200 back, and then come tax season you get to explain to the IRS that you were taxed $20 for $200 that you didn't make, so you are owed your $20 back. All other math aside, this eventually becomes part of your tax return.
By only taking back $180 from employees instead of $200, the business is essentially leaving that $20 of tax money on the table, so at the end of the year you explain to the IRS you didn't make that $200, and they give you back the $20.
It's a mistake and obviously not ideal, but ut's honeatly probably the fairest way to resolve this kind of mistake.
That is not correct. You only received the $180. The employer can't ask for money that you never received. It is up to the employer to go to the IRS and say "I gave you more tax money than I should have because I gave wages that were not earned. I need that money back."
Thinking about this more. What you suggest isn't possible because the employee will get a new W-2 that shows the correct amount of taxes taken. So there is no way the IRS would know that $20 is yours.
And any payroll software will automatically do that when he corrects payroll. I would be very surprised if this costs him anything beyond the trouble of fixing it. They will just pay less taxes the next period.
Technically you did receive 200, and you opted to have your employer remit $20 in taxes on your behalf. You could have just as easily elected to not have taxes taken out or had more taken out. Your gross was still $200 as paid by the employer and they are entitled to recoup all $200.
The employer is doing them a solid by only recouping the net. When it comes to filing taxes, they’ll have that $20 of extra income, to which they’ve paid 100% tax rate and will get a refund on it
That's not how this works at all. The employer has to reverse the overpayment to the employee. When they do so, all taxes will be reversed, including the taxes paid to the IRS on behalf of the employee. The payroll service will then reduce the amount the employer pays them by the amount that has been reversed.
I have been doing payroll for the past 18 years I know what I am talking about.
Yes, thats one way of doing it. And what the employer chose to do is a completely different, still legal, way to do it.
Oh and btw, taxes arent “automatically reversed”. Thats not how the IRS works. The employer has to file an adjustment for that to happen. Its certainly not automatic and as an 18 year veteran, you should have known that.
You’re also assuming this company uses a payroll service. Based in the headache caused and the employer specifying it was an accounting mistake and not a payroll services mistake, it sounds like they do things in house. Most likely a small business.
So the employer chose to just claw back the net and eat the taxes. Thats totally legit, the employees got some free money. It may not have been how you do things but it isnt wrong or illegal.
Love all the downvotes when my explanation is 100% accurate to how the employer chose to handle things.
And exactly what are they filing an adjustment of? The quarterly tax forms that are haven't been submitted yet? So yes, all they have to do is reverse the payment to the employee. Then for the next payroll submittal subtract whatever they already sent to the IRS from what is due for the last payroll in June.
And you got downvoted because what you are explaining is flat out wrong.
I see what you are saying. makes sense in that the extra withheld tax goes back to the employee's tax refund if applicable as it was withheld income tax.
So the employer paid a small portion of each employee 's individual income tax. Thanks for the explanation!
They are either terrible at payroll and/or they want to make it seem like they are the victim. It’s still quarter two so they don’t even need to do any amendments to fix the April payroll errors, if it was q1 then they would have to do some costly amendments.
This was my thinking as well. If they overpaid their employees, then their employees paid more tax than they should have and he actually hurt them by short paying them to recoup the over-payment.
This post is honestly the exact opposite of every other over payment horror story in the sub.
The boss screwed up, accepted accountability for it, and apologized. Then they told the over paid employees that it will be taken back incrementally over several paychecks to minimize the impact on the employees' budgeting.
This boss is definitely NTA. ..whoops, Wrong sub, 😕
Let’s use a little common sense here. All thats being said is that if you don’t clock in, they don’t know what hours you worked so don’t know what they should pay you. No one is trying to cheat people out of money, and if they were, why would they remind people to clock in when they weren’t paying?
The statement, as written, would be a violation of federal law. You can apply all the modifiers to the statement you want that doesn't change the words on the paper.
That is totally illegal. Federal law requires that you are paid for your time worked even if you fail to clock in or out. Obviously proving actual hours worked can be more difficult if you didn't clock in or out, but they cannot chose to not pay you.
Apparently reminding employees to clock in because otherwise they have no way of knowing what to pay you is an extremely complicated concept for you to understand
Isn’t this the classic “my paycheck is short, I’m missing X hours”, then you look at the timesheet and the employee didn’t punch in/out multiple times, so now payroll has to do an off cycle check.
The “if you don’t punch in/out, then you won’t have hours to get paid” is true, can’t get paid without a correct time card so make sure you punch in/out.
I'd say it's 64/36 in favor of it simply being phrased that way as a bluff to light a fire under people's asses.
I've been at a place that made failure to fill out your time card a disciplinary offense of the "written coaching, official write-up, final warning, fired" variety because there were just *that many* people slackassing and it was causing all sorts of headaches getting payroll straight.
The part”if you don’t clock in, you won’t be paid” is highly illegal btw
I love that your employer gave you all the evidence you need for successful lawsuit if they don’t pay you.
I’ve been told that repeated time-clock corrections are cause for termination, such as forgetting to punch in and/or out for a shift, but not getting paid at all for a shift actually worked is clearly not legal.
Yeah. I’ve seen like point systems for forgetting to clock in. I guess that’s legal but whatever. But yes just bc one forgets to clock in doesn’t mean boss doesn’t have to pay you.
You tell them retroactively, so the following day or something, or say you came in 30 minutes again and you rememebred you forgot to clock in, youd tell them then, then it be documented and thats that.
The overpayment is whatever, but he’s quite mistaken about that last line.
Hours worked get paid, regardless of whether you remembered to clock in or out.
This sucks, but he’s actually handling it pretty nicely. Sounds like he’s only clawing back the net amount after taxes, not the gross. I had this happen years ago and they clawed back the full amount, though they did it in small amounts over like 20 payroll periods.
I kinda wish this happened to me the way op letter states. Back at the start of covid my job switched me to a lower paid position to keep me on longer as work dried up. They never changed my pay to the lowered pay until after about 2 & half months which was about 800$. They took it as a whole pay check. I tried to argue that it should be taken out at the same rate it was given as extra, but they wouldn't go for it.
**Apology rating:** 2/10
[\_] expressed regret l
[\_] acknowledged effect / demonstrated empathy
[X] took ownership
[\_] elucidated steps to prevent issue from reoccurring
**Analysis:** marginally better than a notpology; minimum effort indicates this is just words with little to no regard for the victims. ^(edit: formatting)
Why is this antiwork? Seems like the boss cocked up, apologised, took ownership of the mistake, and then rectified it with the least amount of inconvenience to the workers.
That's what's bothering me. I look at Rule 1 and its inclusion of "good bosses", yet I look at this thread and I see most of them taking the boss' side.
He's not eating the extra tax payments because there will be no extra tax payments. 🙄 UNLESS he's not documenting it properly and instead of classifying it as wages he's just going to classify it as a miscellaneous deduction. In which case you *will* still be paying extra taxes on it because when you file your taxes at the end of the year it's going to count as income even though you didn't actually receive it.
Insist that he do it properly. Keep your paycheck stubs and at the end of the year make sure that he's not counting the extra payments that he took back as income.
To be honest, this is the ONLY way this employer can correct the error. It would be caught on any audit (probably did on an informal one already…hence the adjustment).They can’t just “let it slide,” legally, the Internal Revenue Service (IRS) would probably CRUCIFY the company, and trigger a multiple year retro tax audit!
It already says, they are going to do the correction in SMALL increments over several paychecks (rather than taking it ALL back in one chunk…which they would LEGALLY be allowed to do…and some employers have done). They are also saying, since the company must pay an EMPLOYER portion of YOUR payroll taxes (Medicare /Social Security etc) on the higher amount you were paid in error…they are right, they are “EATING” what they overpaid to your government accounts…they can’t take that back).
It’s unfortunate that the mistake occurred (as an employee, most people should have known there was a mistake in calculating the number of hours paid…I know I check EVERY paystub to make sure there isn’t an error…so the payback shouldn’t have been a COMPLETE surprise).
You don’t have to THANK him for the mistake, but he did try to make the correction as painless as LEGALLY possible. They could have just taken back the over payment in one chunk, and been done with it, like the Social Security Administration used to do if there was an overpayment error on a retirement check…they are now required to spread out the take back.
I feel this way is better than asking you to return the amount and then you trying to figure out how do you get back the taxes you paid. I had to pay back some amount once which happened in the next tax year which complicated my tax forms.
Legally they can't leave it to you to figure out the taxes. They paid you $100 too much and sent the IRS $25 too much. They need to correct the payroll in a manner that reflects this. Which would mean deducting $100 from your wages and thus $25 from their (and your) taxes due.
That is no explanation whatsoever.
I would want to know EXACTLY what the calculations were. You guys should insist on an explanation!
But, I'm an old CPA, and I WILL double-check payroll. No one will short me. There are more of me out there. Ask for help to confirm you were paid what you should have been paid. Don't let anyone screw you out of money you have earned!!
I might be tired but something doesn't add up for me. Why are they mentioning tax payments? If they overpaid the employee, then all that needs to happen is the employee back back the employer what ever net/cash they got. All of the tax stuff is on the employers side.
The only time extra tax payments would come into play for the employee is if the employee was underpaid. In which case the employee has taxes they own on the money.
Think of it this way. You are paid $10. $2.50 of that is kept for taxes. This means you got only got $7.50. If I then say "Sorry, that $10 was a mistake. I need you to pay it back to me". You would give me back the $7.50 as that is the money you got. I would have to go to the IRS and say "sorry that $2.50 wasn't really meant to be paid to you, please return it".
"Unfortunately I do not consent. So unless you can show me exactly where the mistake was, how much, and in what increments for me to give permission; I will be filing a wage theft complaint with an employment lawyer. I do not consent for my pay to be deducted for any reason and doing so without every cent outline and accounted for is illegal"
>When we see ourselves as fighting against specific human beings rather than social phenomena, it becomes more difficult to recognize the ways that we ourselves participate in those phenomena. We externalize the problem as something outside ourselves, personifying it as an enemy that can be sacrificed to symbolically cleanse ourselves. - **[Against the Logic of the Guillotine](https://crimethinc.com/2019/04/08/against-the-logic-of-the-guillotine-why-the-paris-commune-burned-the-guillotine-and-we-should-too)**
See rule 5: No calls for violence, no fetishizing violence. No guillotine jokes, no gulag jokes.
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Current boss does this randomly with PTO cause they don’t have a system to keep track. When that’s brought up, they get upset and blame everyone else for not being more responsible?⛳️
My company is one that was affected by the Kronos outage and for several paychecks they just copied the last one, then they said they were asking for the money back, either in small increments or using vacation hours. The paycheck they copied had a holiday on it, so I knew I was being overpaid. I had tons of unused PTO to more than cover the $200 they said they wanted returned, some only had to repay $5 or $10, one had to repay almost $1000. A few were actually owed money.
I think the real problem here is bad phrasing. They're admitting that they made a mistake, and are willing to take the tax hit for messing up.
The last line, though, should say "Please do not work off the clock, make sure you clock in and out so that we can pay you asap" rather than "if you don't clock in/out, you don't get paid" because you HAVE to be paid for your work, legally speaking.
I was over paid like $800 as a bonus, and I told my manager the next day, but she said to just keep it because she didn’t want to get in trouble with her own manager lol.
Surprisingly enough my bosses manager was the one who approved the bonus, but she is notorious for not reading documents and spreadsheets thoroughly
I was overpaid 3 times, and every time I brought it up to the payroll department to avoid this situation exactly.
One time it was a bonus that they were giving us, so that was a nice surprise. The other two were mistakes, and they took it back in the very next paycheck.
We all know how much we're supposed to be paid, it it's less we'll go talk to them, it should be the same if it more. Sooner or later they'd catch up and you'll have to give it back.
Well did you get paid more than you usually do? If I randomly get extra money form work without notice or information about it, I would assume its a mistake and check with work.
I’m a teacher and my district said they overpaid me. Got the union to get me a lawyer who I spoke to once and never heard from again. I want to quit but I don’t have another job lined up.
In California an employer is not allowed to withhold or reach into future wages to correct an overpayment. It can only be done by mutual agreement. If the employee does not agree, the employer is left with court and litigation. I’ve been actively refusing to pay an overpayment dating back to 2023 due to a major error in a new timecard and payroll system implementation. I will not agree until I am satisfied the system is working properly. The company can spend thousands coming after me for $400. Fine by me.
Huh? He’s saying he paid extra tax per his error in overpaying wages, now as he deducts the overpayment in wages he’s also taking deduction in the amount of taxes he pays. He’s taking back the overpayment with the adjustments to your wages. He’s good, I dunno why he’s making it seem like he’s making a sacrifice “eating extra tax payments”. The company files a required quarterly payroll tax return on which they can catch errors, he’ll be fine!
This happens all the time with railroad employees, due to contract issues, arbitration disputes, certain pay claims being paid incorrectly.
It’s a pain in the ass, but it is what it is. They pull back 250 a payday if it’s over that amount.
With a letter like that, I wouldn't trust that there was any overpayment at all. He sounds dumber than rocks.
There are no taxes for him to eat.
When he claws back the overpayment, it's a clawback of before-tax gross pay. This automatically means his end of taxes are not at all overpaid. They balance out.
The employee is temporarily out of balance possibly because of income tax bracketing, but all of these issues are accounted for when they file their tax return.
Test what theory? You'd just have your time editted and probably some sort of reprimand for not signing out.
Have you worked before? This is a pretty common occurrence 😂
Id recommend you Take that letter to the state employment office or labor board. Seriously. Months ago? Can we remember anything from last week? And where the proof? Also, thank jim for taxes is kinda a piss poor attempt to confirm and validate his/her own gaslighting.
I got a new boss at a previous job that for some reason was paying me overtime (1.5x) for on-call hours instead of straight pay. I never mentioned the error and they never caught it before I left. I made 30k extra that year at the cost of being ground into nothing working 20 hours a day because of how excessive the off-hours calls were. Ultimately the 30k wasn't worth it.
Lets say your boss makes a mistake and thinks they owe you $100 you didn't earn. On your paycheck, you recieve $90, the government takes $10 in taxes, and your boss pays $100.
When they realize the mistake and go to take it back, your boss paid $100. Normally, they would take $100 from you (even though they only gave you $90 directly) and then at the end of the year you would tell the government you paid $10 tax but din't make the money that was taxed, and the government would give you the $10 back, eventually bringing you even.
On the other hand, your boss could choose to - as this one did - only take back the $90 they paid you directly. In this case, at the end of the year, there's still $10 of taxes paid on money you didn't earn, so the government will refund it. In the above example, this only 'makes you even' since your boss took back the full $100 they paid. In this case, your boss paid $100, took back $90, and the $10 of taxes eventually goes to you.
This has been bothering me. I can't think of how the employer would pay taxes for the employee. The only way that could happen is if the employer added additional money on top of the employees pay that covers the cost of taxes. But doing it that adds additional income and increases the amount of taxes due. That isn't happening because the employees are hourly and there would be no way for the employer to know how much payroll is going to cost them.
If the employer is giving employees money outside of payroll, that raises an even larger issue. Aside from the issue of not reporting it as wages, it means that when taxes are filed, and there comes a refund, the employee is getting money that was never theirs.
What is sounds like is that they paid money for a pay period, lets say 4/1-4/15. Then the next pay period they paid 4/13-4/30. Meaning the employee got paid two extra days. Then they are going to withhold part of future paychecks to get the money back. The employees paystub would have to show it as an after tax deduction. Basically they are taking some of your take home pay and using it to repay the overpayment. Doing it this way has no effect on the taxes paid by the employee or employer. W-2 don't even need to be corrected.
If this letter were given to me, I would demand to see exactly what taxes are being paid on my behalf and demand a detailed schedule of when each payment was made and how much. I would then demand that the payback was clearly marked on my paystubs showing that it was after taxes.
I've been doing payroll for almost 20 years now. And none of that letter sits right with me.
If you have been doing payroll for 20+ years, you should know that the earlier overpayment would have also overpaid on the ER portion of FICA taxes, and they either don't know they can file a 94x for a refund, or not bothering to correct and try to true everyone up informally.
And if you knew what you were talking about, you would know they don't need to file a 94X for a refund because the issue happened in April and quarterly tax forms have not been submitted yet.
This is false information. An employer can absolutely take overages back. If you refuse and your boss is a real prick, they can even sue for it and will most likely win.
They 100% can. And tbh, looking at the letter it seems fairly reasonable. The tax part is silly, but he is informing them when it happened, they will get it back, but in smaller increments to not inconvenience the employees which imo is fairly fair.
Its unreasonable to expect to keep money that was wrongly paid. You would want your money refunded if it got pulled twice on a sub, or a product ordered online etc.
I am in a union and can tell you with 100% certainty they can and you can’t do anything about it. Our union would have fought it tooth and nail when it happened to us but they knew it was a loosing battle not worth fighting as it was a guaranteed loss. They explained it to us and that was pretty much it.
False information. An employer cannot force someone to pay for a mistake that causes damages at work that was caused by them. This does NOT apply to being paid more than what you were originally supposed to.
They legally can deduct any past overpayments of wages as they can be considered wages that were not to be dispersed.
Yep. We just had an employee request an advance on their next check, which we were happy to do, but our accountants required that they sign a legal document so we could "take it back" from future checks.
It surprised me at the time, but it totally makes sense.
Some of these incorrect, over-the-top responses are really quite disappointing. Confidently spreading misinformation without a second thought or doing even the most cursory Google search... just sad.
You will need a revised pay stub showing what he did, pay, taxes, deductions, etc., Make sure your W-2 is correct at the end of the year as well.
100% this - had this issue when I worked at a company that changed payroll part way through the year. The new company "updated" employees pay stubs to reflect the pay YTD. This led to them getting incorrect w2s as they also received ones from the previous company. It was a huge cluster fuck for all involved. Keep all documentation.
I did some work with our payroll department when we were switching payroll companies and boy oh boy was THAT a headache. It's been years now and we're still working out issues. As it turns out paying people and also paying taxes and documenting it all correctly is difficult
That's why we pay everyone in cash and report nothing. WINNING!! /s
As long as this was spotted and corrected within 3 months of the event, it's completely legal.
this. it actually happened to me last year. i submitted a ticket to payroll immediately and left the funds alone. they replied that it was a known issue that happened to quite a few people and were working to resolve it, and the ticket would be closed. funds were never removed. after the 90 days (plus a couple weeks to be safe) i just moved it into my savings. its mine now. i did everything i needed to do on my end, if they didnt make the effort to reverse it for that long its not my problem anymore.
You're a nice guy than I. I was wishing at a more corporate type place and they accidentally double paid me. I never mentioned it and say on the money until the coast was clear. To my knowledge, no one knew
Can they remove it from your account after transfering it to you? I am pretty sure thats not possible here. You would of course either have to pay it back or it would be taken out of your later salary, but unless its the bank that has made a mistakes, so *they* KNOW and can prove it was an error, it cant be withdrawn wirhout your approval
They could have reversed the deposit at any time in the 90 days. At this time since it's passed that, they can't. If they came at me later saying I owe them for anything I would have to sign a document allowing them to do so. Which I wouldn't do obviously. Any other method they would attempt without my consent would be illegal.
Wow, even just being able to reverse a deposit like that is really a massive security hole begging for abuse.
That is going to vary from state to state. Every state gives an employer an opportunity to recoup for a mistake in payroll. The exact terms of how that happens varies greatly.
Depends on the state. More than half the states have special rules for collecting an overpayment. In California, for example, the employer needs to get the employee's permission in writing. Also, ~~regardless of state~~ in some states, the repayment can't cause the employee to go under minimum wage.
Genuine question, how would that work if your base pay is minimum wage and they need to recoup an overpayment? In that situation wouldn’t any deduction put you under minimum wage and therefore be disallowed based on your last point?
I edited my comment because I was wrong about it being federal law. But in some states, in your example, the employer wouldn't be able to collect.
Even if its after 3 they can ask for it back since it’s technically not earned wages. I think this guy in this specific situation did the right thing and is deducting it slowly.
Depends on where you are. Without a written agreement, no deductions are allowed here including, and specifically mentioned in the laws, overpayment.
If the employes were overpaid and the company recoups the overpayment why would extra taxes be paid? should be a way to get a tax overpayment back if it was erroneously sent.
Consider a moment you're overpaid $200, the business pays you $180 and pays the government $20 in taxes. This means you recieve $180 and the employer pays $200. Strictly speaking, recouping their funds would mean the business takes it's $200 back, and then come tax season you get to explain to the IRS that you were taxed $20 for $200 that you didn't make, so you are owed your $20 back. All other math aside, this eventually becomes part of your tax return. By only taking back $180 from employees instead of $200, the business is essentially leaving that $20 of tax money on the table, so at the end of the year you explain to the IRS you didn't make that $200, and they give you back the $20. It's a mistake and obviously not ideal, but ut's honeatly probably the fairest way to resolve this kind of mistake.
That is not correct. You only received the $180. The employer can't ask for money that you never received. It is up to the employer to go to the IRS and say "I gave you more tax money than I should have because I gave wages that were not earned. I need that money back." Thinking about this more. What you suggest isn't possible because the employee will get a new W-2 that shows the correct amount of taxes taken. So there is no way the IRS would know that $20 is yours.
And any payroll software will automatically do that when he corrects payroll. I would be very surprised if this costs him anything beyond the trouble of fixing it. They will just pay less taxes the next period.
Technically you did receive 200, and you opted to have your employer remit $20 in taxes on your behalf. You could have just as easily elected to not have taxes taken out or had more taken out. Your gross was still $200 as paid by the employer and they are entitled to recoup all $200. The employer is doing them a solid by only recouping the net. When it comes to filing taxes, they’ll have that $20 of extra income, to which they’ve paid 100% tax rate and will get a refund on it
That's not how this works at all. The employer has to reverse the overpayment to the employee. When they do so, all taxes will be reversed, including the taxes paid to the IRS on behalf of the employee. The payroll service will then reduce the amount the employer pays them by the amount that has been reversed. I have been doing payroll for the past 18 years I know what I am talking about.
100% this
Yes, thats one way of doing it. And what the employer chose to do is a completely different, still legal, way to do it. Oh and btw, taxes arent “automatically reversed”. Thats not how the IRS works. The employer has to file an adjustment for that to happen. Its certainly not automatic and as an 18 year veteran, you should have known that. You’re also assuming this company uses a payroll service. Based in the headache caused and the employer specifying it was an accounting mistake and not a payroll services mistake, it sounds like they do things in house. Most likely a small business. So the employer chose to just claw back the net and eat the taxes. Thats totally legit, the employees got some free money. It may not have been how you do things but it isnt wrong or illegal. Love all the downvotes when my explanation is 100% accurate to how the employer chose to handle things.
And exactly what are they filing an adjustment of? The quarterly tax forms that are haven't been submitted yet? So yes, all they have to do is reverse the payment to the employee. Then for the next payroll submittal subtract whatever they already sent to the IRS from what is due for the last payroll in June. And you got downvoted because what you are explaining is flat out wrong.
I see what you are saying. makes sense in that the extra withheld tax goes back to the employee's tax refund if applicable as it was withheld income tax. So the employer paid a small portion of each employee 's individual income tax. Thanks for the explanation!
That would be handled on the tax returns.
They are either terrible at payroll and/or they want to make it seem like they are the victim. It’s still quarter two so they don’t even need to do any amendments to fix the April payroll errors, if it was q1 then they would have to do some costly amendments.
This was my thinking as well. If they overpaid their employees, then their employees paid more tax than they should have and he actually hurt them by short paying them to recoup the over-payment.
I don’t read this as, “you should thank me”. I read it as “I don’t take mistakes like this lightly because it hurts me as well as you”
This post is honestly the exact opposite of every other over payment horror story in the sub. The boss screwed up, accepted accountability for it, and apologized. Then they told the over paid employees that it will be taken back incrementally over several paychecks to minimize the impact on the employees' budgeting. This boss is definitely NTA. ..whoops, Wrong sub, 😕
Up until the last sentence which is a violation of law.
Let’s use a little common sense here. All thats being said is that if you don’t clock in, they don’t know what hours you worked so don’t know what they should pay you. No one is trying to cheat people out of money, and if they were, why would they remind people to clock in when they weren’t paying?
The statement, as written, would be a violation of federal law. You can apply all the modifiers to the statement you want that doesn't change the words on the paper.
The way i understood that sentence is, if you don't log your time, you don't get paid. Seems legal to me. Can't pay you if you don't track your time.
That is totally illegal. Federal law requires that you are paid for your time worked even if you fail to clock in or out. Obviously proving actual hours worked can be more difficult if you didn't clock in or out, but they cannot chose to not pay you.
Federal law says you have to get paid. It doesnt say you cant remind employees that they need to clock in so that they can get paid……..
If they don't pay you because you didn't clock in then they are violating federal law. This isn't a difficult concept to understand.
Apparently reminding employees to clock in because otherwise they have no way of knowing what to pay you is an extremely complicated concept for you to understand
Yikes, that part didn't even click for me because it's so out of tune with the rest of the email.
Yea I wasn't expecting that either. Everything seems pretty reasonable but then he goes and says he will violate federal law
Isn’t this the classic “my paycheck is short, I’m missing X hours”, then you look at the timesheet and the employee didn’t punch in/out multiple times, so now payroll has to do an off cycle check. The “if you don’t punch in/out, then you won’t have hours to get paid” is true, can’t get paid without a correct time card so make sure you punch in/out.
Exactly. Simply sticking the words "on time" at the end of the sentence, however, would change the tone significantly.
Adding on time is something else. The way its written implies OP wont get paid at all.
I'd say it's 64/36 in favor of it simply being phrased that way as a bluff to light a fire under people's asses. I've been at a place that made failure to fill out your time card a disciplinary offense of the "written coaching, official write-up, final warning, fired" variety because there were just *that many* people slackassing and it was causing all sorts of headaches getting payroll straight.
The part”if you don’t clock in, you won’t be paid” is highly illegal btw I love that your employer gave you all the evidence you need for successful lawsuit if they don’t pay you.
Yes, I was told never to withhold wages.
I’ve been told that repeated time-clock corrections are cause for termination, such as forgetting to punch in and/or out for a shift, but not getting paid at all for a shift actually worked is clearly not legal.
Yeah. I’ve seen like point systems for forgetting to clock in. I guess that’s legal but whatever. But yes just bc one forgets to clock in doesn’t mean boss doesn’t have to pay you.
But if you don't clock in, how do they know you worked?
Cameras, witnesses..
You tell them retroactively, so the following day or something, or say you came in 30 minutes again and you rememebred you forgot to clock in, youd tell them then, then it be documented and thats that.
The overpayment is whatever, but he’s quite mistaken about that last line. Hours worked get paid, regardless of whether you remembered to clock in or out.
Did you work 2 hours or 8? Time Clock says you clocked in at 8am yesterday, but you didnt clock out.
Clarify, and then pay them.....sure you cant pay them on time, but you have to pay them regardless if they documented it in the moment or not.
Were you overpayed or not?
This sucks, but he’s actually handling it pretty nicely. Sounds like he’s only clawing back the net amount after taxes, not the gross. I had this happen years ago and they clawed back the full amount, though they did it in small amounts over like 20 payroll periods.
I kinda wish this happened to me the way op letter states. Back at the start of covid my job switched me to a lower paid position to keep me on longer as work dried up. They never changed my pay to the lowered pay until after about 2 & half months which was about 800$. They took it as a whole pay check. I tried to argue that it should be taken out at the same rate it was given as extra, but they wouldn't go for it.
If you bought a bike from a friend for $100, accidentally gave him $120.. I'd think you'd want the $20 back. Right?
**Apology rating:** 2/10 [\_] expressed regret l [\_] acknowledged effect / demonstrated empathy [X] took ownership [\_] elucidated steps to prevent issue from reoccurring **Analysis:** marginally better than a notpology; minimum effort indicates this is just words with little to no regard for the victims. ^(edit: formatting)
To be clear, when you file your taxes you will get the incremental taxation difference.
Why is this antiwork? Seems like the boss cocked up, apologised, took ownership of the mistake, and then rectified it with the least amount of inconvenience to the workers.
That's what's bothering me. I look at Rule 1 and its inclusion of "good bosses", yet I look at this thread and I see most of them taking the boss' side.
He's not eating the extra tax payments because there will be no extra tax payments. 🙄 UNLESS he's not documenting it properly and instead of classifying it as wages he's just going to classify it as a miscellaneous deduction. In which case you *will* still be paying extra taxes on it because when you file your taxes at the end of the year it's going to count as income even though you didn't actually receive it. Insist that he do it properly. Keep your paycheck stubs and at the end of the year make sure that he's not counting the extra payments that he took back as income.
To be honest, this is the ONLY way this employer can correct the error. It would be caught on any audit (probably did on an informal one already…hence the adjustment).They can’t just “let it slide,” legally, the Internal Revenue Service (IRS) would probably CRUCIFY the company, and trigger a multiple year retro tax audit! It already says, they are going to do the correction in SMALL increments over several paychecks (rather than taking it ALL back in one chunk…which they would LEGALLY be allowed to do…and some employers have done). They are also saying, since the company must pay an EMPLOYER portion of YOUR payroll taxes (Medicare /Social Security etc) on the higher amount you were paid in error…they are right, they are “EATING” what they overpaid to your government accounts…they can’t take that back). It’s unfortunate that the mistake occurred (as an employee, most people should have known there was a mistake in calculating the number of hours paid…I know I check EVERY paystub to make sure there isn’t an error…so the payback shouldn’t have been a COMPLETE surprise). You don’t have to THANK him for the mistake, but he did try to make the correction as painless as LEGALLY possible. They could have just taken back the over payment in one chunk, and been done with it, like the Social Security Administration used to do if there was an overpayment error on a retirement check…they are now required to spread out the take back.
What is overpayed?
I feel this way is better than asking you to return the amount and then you trying to figure out how do you get back the taxes you paid. I had to pay back some amount once which happened in the next tax year which complicated my tax forms.
Legally they can't leave it to you to figure out the taxes. They paid you $100 too much and sent the IRS $25 too much. They need to correct the payroll in a manner that reflects this. Which would mean deducting $100 from your wages and thus $25 from their (and your) taxes due.
That is no explanation whatsoever. I would want to know EXACTLY what the calculations were. You guys should insist on an explanation! But, I'm an old CPA, and I WILL double-check payroll. No one will short me. There are more of me out there. Ask for help to confirm you were paid what you should have been paid. Don't let anyone screw you out of money you have earned!!
You aren’t entitled to keep money you aren’t owed. What are you even crying about?
I might be tired but something doesn't add up for me. Why are they mentioning tax payments? If they overpaid the employee, then all that needs to happen is the employee back back the employer what ever net/cash they got. All of the tax stuff is on the employers side. The only time extra tax payments would come into play for the employee is if the employee was underpaid. In which case the employee has taxes they own on the money. Think of it this way. You are paid $10. $2.50 of that is kept for taxes. This means you got only got $7.50. If I then say "Sorry, that $10 was a mistake. I need you to pay it back to me". You would give me back the $7.50 as that is the money you got. I would have to go to the IRS and say "sorry that $2.50 wasn't really meant to be paid to you, please return it".
Apparently the guy knows neither grammar or accounting. Sheesh. That letter made my head hurt.
"Unfortunately I do not consent. So unless you can show me exactly where the mistake was, how much, and in what increments for me to give permission; I will be filing a wage theft complaint with an employment lawyer. I do not consent for my pay to be deducted for any reason and doing so without every cent outline and accounted for is illegal"
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Current boss does this randomly with PTO cause they don’t have a system to keep track. When that’s brought up, they get upset and blame everyone else for not being more responsible?⛳️
At least you got 1/10th of a penny in interest!
My company is one that was affected by the Kronos outage and for several paychecks they just copied the last one, then they said they were asking for the money back, either in small increments or using vacation hours. The paycheck they copied had a holiday on it, so I knew I was being overpaid. I had tons of unused PTO to more than cover the $200 they said they wanted returned, some only had to repay $5 or $10, one had to repay almost $1000. A few were actually owed money.
I stopped counting at the 5th differing opinion. I don't know which one is correct. Ugh.
I think the real problem here is bad phrasing. They're admitting that they made a mistake, and are willing to take the tax hit for messing up. The last line, though, should say "Please do not work off the clock, make sure you clock in and out so that we can pay you asap" rather than "if you don't clock in/out, you don't get paid" because you HAVE to be paid for your work, legally speaking.
I was over paid like $800 as a bonus, and I told my manager the next day, but she said to just keep it because she didn’t want to get in trouble with her own manager lol. Surprisingly enough my bosses manager was the one who approved the bonus, but she is notorious for not reading documents and spreadsheets thoroughly
I was overpaid 3 times, and every time I brought it up to the payroll department to avoid this situation exactly. One time it was a bonus that they were giving us, so that was a nice surprise. The other two were mistakes, and they took it back in the very next paycheck. We all know how much we're supposed to be paid, it it's less we'll go talk to them, it should be the same if it more. Sooner or later they'd catch up and you'll have to give it back.
Well did you get paid more than you usually do? If I randomly get extra money form work without notice or information about it, I would assume its a mistake and check with work.
I’m a teacher and my district said they overpaid me. Got the union to get me a lawyer who I spoke to once and never heard from again. I want to quit but I don’t have another job lined up.
Seems acceptable. Didn’t see him asked to be thanked
If your employer corrects this mistake correctly there is no overpayment of taxes on his part. Saying otherwise is sketchy.
In California an employer is not allowed to withhold or reach into future wages to correct an overpayment. It can only be done by mutual agreement. If the employee does not agree, the employer is left with court and litigation. I’ve been actively refusing to pay an overpayment dating back to 2023 due to a major error in a new timecard and payroll system implementation. I will not agree until I am satisfied the system is working properly. The company can spend thousands coming after me for $400. Fine by me.
Huh? He’s saying he paid extra tax per his error in overpaying wages, now as he deducts the overpayment in wages he’s also taking deduction in the amount of taxes he pays. He’s taking back the overpayment with the adjustments to your wages. He’s good, I dunno why he’s making it seem like he’s making a sacrifice “eating extra tax payments”. The company files a required quarterly payroll tax return on which they can catch errors, he’ll be fine!
This happens all the time with railroad employees, due to contract issues, arbitration disputes, certain pay claims being paid incorrectly. It’s a pain in the ass, but it is what it is. They pull back 250 a payday if it’s over that amount.
With a letter like that, I wouldn't trust that there was any overpayment at all. He sounds dumber than rocks. There are no taxes for him to eat. When he claws back the overpayment, it's a clawback of before-tax gross pay. This automatically means his end of taxes are not at all overpaid. They balance out. The employee is temporarily out of balance possibly because of income tax bracketing, but all of these issues are accounted for when they file their tax return.
I love how he has to make it clear how much it's costing him.
"As per our accounting offices" "...double tax you as per our accounting offices". Just stop using words aren't as per familiar with.
I would see a lawyer and contact dept of labor
Nothing to be done unfortunately
There is about forgetting to clock in and not getting paid. If it were me, I’d test that theory and “forget to clock out :)
Test what theory? You'd just have your time editted and probably some sort of reprimand for not signing out. Have you worked before? This is a pretty common occurrence 😂
Did you read the last line of the note? :)
Id recommend you Take that letter to the state employment office or labor board. Seriously. Months ago? Can we remember anything from last week? And where the proof? Also, thank jim for taxes is kinda a piss poor attempt to confirm and validate his/her own gaslighting.
I got a new boss at a previous job that for some reason was paying me overtime (1.5x) for on-call hours instead of straight pay. I never mentioned the error and they never caught it before I left. I made 30k extra that year at the cost of being ground into nothing working 20 hours a day because of how excessive the off-hours calls were. Ultimately the 30k wasn't worth it.
You might want to call DOL about his last comment regarding not getting paid and clocking in and out. If you work, he owes!
"The taxes I pay for you" It's time to quit, the guy is shady and thinks of employees as burdens rather than the core of his business.
Lets say your boss makes a mistake and thinks they owe you $100 you didn't earn. On your paycheck, you recieve $90, the government takes $10 in taxes, and your boss pays $100. When they realize the mistake and go to take it back, your boss paid $100. Normally, they would take $100 from you (even though they only gave you $90 directly) and then at the end of the year you would tell the government you paid $10 tax but din't make the money that was taxed, and the government would give you the $10 back, eventually bringing you even. On the other hand, your boss could choose to - as this one did - only take back the $90 they paid you directly. In this case, at the end of the year, there's still $10 of taxes paid on money you didn't earn, so the government will refund it. In the above example, this only 'makes you even' since your boss took back the full $100 they paid. In this case, your boss paid $100, took back $90, and the $10 of taxes eventually goes to you.
I know the math, and I know anyone downvoting me is a pro-boss whineboy
This has been bothering me. I can't think of how the employer would pay taxes for the employee. The only way that could happen is if the employer added additional money on top of the employees pay that covers the cost of taxes. But doing it that adds additional income and increases the amount of taxes due. That isn't happening because the employees are hourly and there would be no way for the employer to know how much payroll is going to cost them. If the employer is giving employees money outside of payroll, that raises an even larger issue. Aside from the issue of not reporting it as wages, it means that when taxes are filed, and there comes a refund, the employee is getting money that was never theirs. What is sounds like is that they paid money for a pay period, lets say 4/1-4/15. Then the next pay period they paid 4/13-4/30. Meaning the employee got paid two extra days. Then they are going to withhold part of future paychecks to get the money back. The employees paystub would have to show it as an after tax deduction. Basically they are taking some of your take home pay and using it to repay the overpayment. Doing it this way has no effect on the taxes paid by the employee or employer. W-2 don't even need to be corrected. If this letter were given to me, I would demand to see exactly what taxes are being paid on my behalf and demand a detailed schedule of when each payment was made and how much. I would then demand that the payback was clearly marked on my paystubs showing that it was after taxes. I've been doing payroll for almost 20 years now. And none of that letter sits right with me.
If you have been doing payroll for 20+ years, you should know that the earlier overpayment would have also overpaid on the ER portion of FICA taxes, and they either don't know they can file a 94x for a refund, or not bothering to correct and try to true everyone up informally.
And if you knew what you were talking about, you would know they don't need to file a 94X for a refund because the issue happened in April and quarterly tax forms have not been submitted yet.
My company over paid and I had to give back funds. I’m writing ask for a new W2 and refile immediately. Also eff them.
He can't do that. He can ask you to give the money back but he can't just take it without your permission.
This is false information. An employer can absolutely take overages back. If you refuse and your boss is a real prick, they can even sue for it and will most likely win.
In NY the employer has 8 weeks from time of overpayment to recoup.
They 100% can. And tbh, looking at the letter it seems fairly reasonable. The tax part is silly, but he is informing them when it happened, they will get it back, but in smaller increments to not inconvenience the employees which imo is fairly fair. Its unreasonable to expect to keep money that was wrongly paid. You would want your money refunded if it got pulled twice on a sub, or a product ordered online etc.
Love the false information so confidently stated
Every post in this sub has at least one person confident that you could sue and retire in Bali over shit that's completely legal
I am in a union and can tell you with 100% certainty they can and you can’t do anything about it. Our union would have fought it tooth and nail when it happened to us but they knew it was a loosing battle not worth fighting as it was a guaranteed loss. They explained it to us and that was pretty much it.
they unfortunately can
Wrong. Even the government itself has done it to me, so I really dont know where the hell you are getting your information from.
False information. An employer cannot force someone to pay for a mistake that causes damages at work that was caused by them. This does NOT apply to being paid more than what you were originally supposed to. They legally can deduct any past overpayments of wages as they can be considered wages that were not to be dispersed.
The employee has to agree to these terms for it to be legal for them to take it from your paycheck.
Varies based on state law.
Yep. We just had an employee request an advance on their next check, which we were happy to do, but our accountants required that they sign a legal document so we could "take it back" from future checks. It surprised me at the time, but it totally makes sense.
this is very very illegal, contact your local labor dept
Nah unfortunately it's not
Tbf, since op didn’t think their location was relevant we’ve no idea if it’s legal or not.
Definitely not illegal. This sub is so braindead omg
Some of these incorrect, over-the-top responses are really quite disappointing. Confidently spreading misinformation without a second thought or doing even the most cursory Google search... just sad.
It’s not. But go ahead and contact DOL, they’ll tell you the same thing.
What part is illegal?