sabbatical payout overpayment...

[archimedez]

Hi guys. The tech company I was working for recently underwent a large RIF - and I was one of the "lucky" ones that got layed off. I had earned a sabbatical during my employment, so at my termination it was payed out to me.

However, I recently received a letter from the company saying they had overpaid the sabbatical payout by several thousand dollars, and now they want me to pay it back (minus the taxes, etc. that were deducted). The letter states that if I do not pay it back within a given time period, then I will have to pay back the gross amount (i.e., including the deductions).

My question is, what are my legal obligations as far as paying the money back? If I am legally bound to pay the money back, since the money was used to pay off some debts (and I am now unemployed), if I don't pay the net amount w/in the time period, can they legally make me pay back the gross amount as they state? Can they legally make me pay interest?

Thanks for any advice on this matter!

 

[cbg]

If you really were overpaid, then yes, you legally need to repay the money. You can certainly ask for an accounting of how the amount was arrived at, but you have no legal right to keep the money that was paid out in error.

Whether you need repay the net or the gross amount is tax-related and has to do with whether you repay the full amount in the same calendar year as the overpayment was made; however, there are others better qualified than I to explain the specifics.

 

[archimedez]

If you really were overpaid, then yes, you legally need to repay the money. You can certainly ask for an accounting of how the amount was arrived at, but you have no legal right to keep the money that was paid out in error.

Whether you need repay the net or the gross amount is tax-related and has to do with whether you repay the full amount in the same calendar year as the overpayment was made; however, there are others better qualified than I to explain the specifics.

Thanks for the advice, cbg - much appreciated!