Legal Question in Business Law in California

I worked for a temp agency and the company contracted with the agency let me go due to lack of work. They inadvertantly over paid me by $361.00 and are very rudely insisting that I pay this back immediately. I worked for $12.00/hr, have no job now and have no money. Do I really have to pay this back and if I dont can they come after me? I want to do the right thing, but right now I cannot even pay my bills. Additionally, I got no exit check the same day of release, and I did not receive my check for 1 week.

Asked on 8/22/10, 4:39 pm

2 Answers from Attorneys

Edward Hoffman Law Offices of Edward A. Hoffman

Yes, I'm afraid you have to pay it back. Most companies would agree to a payment schedule in circumstances like these, but the law does not require them to.

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Answered on 8/27/10, 4:57 pm
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

I'm assuming that you worked for the agency, that they issued your paycheck, handled the deductions, figured the amount due you, and also the dates on which you were supposed to receive your pay.

The general rule on accidental overpayments is that the party making the overpayment is entitled to have the excess refunded to them UNLESS two conditions are met, in which case the person who was overpaid is not required by law or equity to make a refund:

(1) The person who received the excess payment had no good reason to suspect it was an overpayment at the time, as for example somoen whose weekly paycheck is usually $525 and suddently gets one for $5,250. That's obviously an error, and the person receiving the check would not pass test number one.

(2) The person who received the excess payment has materially changed his position in reliance on the belief that the money is his. If you put the check in your dresser drawer, you have not changed your position. If you used the check to pay the rent, and had no other funds to pay the rent, you have materially changed your position.

I can't tell whether you meet the tests or not. More likely than not, you'd pass test #2, since you probably don't have piles of cash and you had to use, and did use, the $361. Whether or not getting an extra $361 didn't seem a little too much at the time, that is up to you to answer, both to your conscience and to the agency.

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Answered on 8/27/10, 5:02 pm

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