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How to deal with a salary overpayment or deduction

Overpayments and deductions

There are a number of reasons why an employer might accidentally overpay you, or pay you less than you were expecting. It could be an HR or payroll issue, it might be a simple administrative error, or perhaps you've been on sick leave but have been paid in full. In some ways it doesn't matter, in either case you need to take steps to deal with the situation.

  • How to deal with an overpayment

    If you notice an overpayment. Advise your HR department in writing, either a letter or an email, as soon as you can. Arrange for a meeting and invite them to explain the situation to reassure yourself that there has, or hasn't been an overpayment. Before the meeting you should check your employment contract and your employer's written policy, if they have one, with regard to overpayments.

    If an overpayment is confirmed. If you and your employer agree that you have been overpaid, they do have the right to deduct the overpayment from your pay. But there is no law that states how much time your employer has to reclaim the overpayment. Even if your contract, or their written policy, advises that they will take the overpayment immediately, it's usually in your, and your employers', interest to agree to a schedule of payments, so it's always worth suggesting that.

  • How to deal with a deduction

    If you’ve had money deducted from your salary, but your employer didn’t tell you about this in advance, you need to get advice on what steps you can take.

    Get independent advice. You can get this from ACAS or your union rep.

    Get in touch with us. If you're a current or former bank employee, get in touch with us particularly if you're at risk of losing your home, or you can't pay for essentials, we may be able to refer you to our charity partner Law Express.

Tip: If you notice you’ve been overpaid, tell your HR department in writing as soon as you can. 

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