Who Pays Up When Employer Overpays?
By Amy E. Feldman
PHILADELPHIA (CBS) - What happens if your employer accidentally overpays you? Do you have to give it back?
Most people join gyms in January, but a woman quit her job at New York Sports Club in January of 2013. But by mistake, the gym continued to pay her for twenty months - she racked up a total of over $45,000 in salary after she stopped working.
Since it was their mistake, does she get to keep it? Well, unlike those 45,000 additional calories that you racked up over the holidays which are yours to keep, the money she was paid in error is not hers. In fact, by not letting her old company know that they were mistakenly still paying her she was, under some state laws, committing theft by deception - keeping money she knew wasn't really hers.
It happens all the time that companies pay an extra paycheck before word gets to the accounting department that someone quit - and in an era of direct deposit and automatic bill pay, it's often hard to know exactly what's been paid and when and whether it was really yours or not. So there's nothing criminal if you legitimately didn't realize that a company overpaid you - although you still need to give back money you didn't earn.
And, you still have to pay that gym membership long after you remember that you hate both New Year's resolutions AND exercise.