Overpayment to Former Employees

Overpayment to employees, in particular former employees, is more common than you think. It can range from a simple payroll error such as miscalculating a payment of wages and or bonus/commission to seeking recovery of holiday pay, benefits such as a car allowance or train season ticket and even training fees from a former employee.

If the overpayment has been made to a current employee, you have certain rights under the Employment Rights Act 1996 to deduct the overpayment from the next payroll process. However, what happens if the overpayment relates to a former employee? The first step is to write to the former employee requesting payment of the overpaid sum. If you are not sure what to include in your letter, please download our free guide which provides you with template letters.