Terminated employee overpayment letter 2025

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California offers the strongest worker protections against bosses clawing back money that they think was overpaid. First, an employer can only recoup money if the worker signs a written agreement outlining the exact terms of repayment.
Dear: Our records indicate that you received a salary overpayment in the amount of $(gross pay). The salary overpayment resulted because . . . .. Please see a copy of the spreadsheet outlining how and when you were overpaid.
Yes, typically you are obligated to repay any amount you were overpaid. It is considered a debt owed to your employer. In some cases, if the overpayment is not returned, the employer may send the debt to a collection agency to recover the funds.
Sometimes employers can ask for money back. This could be like if you owe them for training or have an outstanding balance on a company loan. But heres the important bit: they cant deduct this money directly from your final paycheck unless you specifically signed something allowing it.
1. If the payment is in error, the employee has to repay that balance. 2. They cannot recover more than the overpayment. If they seek to profit from their error you may simply report them to the labor board. 3. The claim here is timely and would be subject to report or lawsuit in the state where you reside.
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