Employment law essentials
Mar 12 2007
If you were still employed by the company, it would be a case of making a deduction from wages, but as you have left their employment this is clearly not the case and as a result it makes it more difficult for them to get their hands on the cash. They do have every right to stake a claim to the money in the courts, because you have received money to which you were not entitled. This does not mean to say that they would win their case.
If you work out who is morally entitled to the money, you will have your answer. If you realised your employers mistake but refused to repay it and instead spent the money on trivial indulgences you may well find their case is easily won. On the other hand, if you didn’t realise the employers mistake and they didn’t enlighten you until after you had spent the cash, then they would find it harder to argue for repayment, especially after such a long time.
Alternatively, if they win their case, you could ask the court to let you repay it in small instalments, such as a few pounds a month to ease the burden. As you no longer work for the company, they would pursue their case in the County court or High court and different limitation periods apply, that is to say, they must stake their claim to the money in the courts within six years of the overpayment itself.