Recapturing an Overpayment
dotato
13 Posts
[font size="1" color="#FF0000"]LAST EDITED ON 09-11-02 AT 11:55AM (CST)[/font][p]HELP!!!!
We recently implemented a new union contract, and part of the negotiation was retro pay.
When entering the new pay rates into our computer system, two of the individuals (out of 49) had incorrect rates used, so we in effect overpaid them. The overpayment applied to both the retro pay, and the current pay period.
We had already completed the electronic transfer for direct debit, and had called in the total taxes information, so in effect, we can't pull the checks back. Since we already reported the tax information, my assumption is that we can't just ask them to cut us a check for the overpayment, because it will show up as income for them.
So, we are thinking that we'll reduce the amount due in the next pay cycle and be done with it...
Are there any problems with this solution? We assume the members in question will accept the error, it was a computing error...so hopefully they will understand.
Erik
We recently implemented a new union contract, and part of the negotiation was retro pay.
When entering the new pay rates into our computer system, two of the individuals (out of 49) had incorrect rates used, so we in effect overpaid them. The overpayment applied to both the retro pay, and the current pay period.
We had already completed the electronic transfer for direct debit, and had called in the total taxes information, so in effect, we can't pull the checks back. Since we already reported the tax information, my assumption is that we can't just ask them to cut us a check for the overpayment, because it will show up as income for them.
So, we are thinking that we'll reduce the amount due in the next pay cycle and be done with it...
Are there any problems with this solution? We assume the members in question will accept the error, it was a computing error...so hopefully they will understand.
Erik
Comments
Good luck!
If the deduction will take them below minimum wage, that is an issue someone else will have to answer. I believe you might have to space out the deduction so that they would not be paid less than minimum wage on any given paycheck.
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Thank you for your input. Here is what I did:
I learned from my payroll clerk that we had already called in the federal taxes on all wages, therefore it was impossible for us to not pay them. Had we not called in the wages, it would have been possible to simply cut new checks.
That being the case, I personally called the Police Chief and told them what occured, and asked that he have the two officers in question speak with me, I was available to either call them at their convi. or, I would meet with them as needed. Long and short, they called me and I explained what happened (clerk used the budget salary rate, which is an annualized figure, instead of the step rate) and told them we would have to recoup the overpayment. I told them we could do it over two, but would prefer one pay period. One chose two, the other one. We're done, no hard feelings. I sent an email, and a memo to both, copied to the chief, and every body is happy.