Windfall!

December 1, 2004 10:58 AM

My latest paycheck is for double the amount I'm supposed to be getting paid. I get paid by direct deposit, so the money is already in my account. What do I do?
posted by anonymous to Work & Money (39 answers total)

Return the money if you care about your job... it's not like they aren't going to notice.
posted by cedar at 11:03 AM on December 1, 2004

If you can, transfer all of the money that you should not have received into a separate checking account. Then, call your workplace and notify them of the error. That money is not yours.
posted by cohappy at 11:04 AM on December 1, 2004

don't spend it; leave it in your account. contact payroll and your work and contact your bank. someone made a mistake and someone will be taking the money back out. if you take it out first, they're still going to take it out of the account into which they deposited it. chances are, they'll notice the error and take the money out without your asking anyone to do so, but if you make inquiries with both your bank and your payroll office, they're more likely to keep you in the loop before they take action, rather than just sending you a letter telling you what the error was and how they fixed it.

it's happened to me and at least half-a-dozen other people i know and it was pretty much no big deal for anyone except the poor schmoe who spent the money first and asked questions later.
posted by crush-onastick at 11:10 AM on December 1, 2004

If you're being paid biweekly, note that there's an extra pay period this year.
posted by five fresh fish at 11:12 AM on December 1, 2004

Live it up and hope they don't notice!

And if they do notice, pretend to be ignorant about their mistake, so they maybe won't make you repay it.
posted by cmonkey at 11:12 AM on December 1, 2004

I had a coworker who got double-paid twice, and spent the money right away so they couldn't take it back. Payroll was pretty pissed at him, and withheld two future paychecks from him.
posted by agropyron at 11:13 AM on December 1, 2004

If this just happened, wait a few days first.

This has happened to me several times. I just recently bought a Powerbook and Apple credited me instead of charging me. A few days later, i noticed it had all been corrected. The same with over-deposits. Maybe someone who works in accounting can chime in, but in every case this has happened to me, the problem has corrected itself before i needed to take any action.

after a few days, follow the advice above. Don't spend it!
posted by vacapinta at 11:14 AM on December 1, 2004

Also, his head was the first on the chopping block when layoffs came around.
posted by agropyron at 11:14 AM on December 1, 2004

DO NOT DO WHAT COHAPPY SAID.

Am I deliberately yelling? Yes, yes, I am.

They will most likely reverse the deposit directly out of the account it was put into. The money needs to still be there. Don't do anything - like moving the double pay out - that might be interpreted as trying to hide the money.
posted by jacquilynne at 11:20 AM on December 1, 2004

The first paycheck I ever received, as an intern, I had exactly this same thing happen to me (although I didn't have direct deposit at the time).

There is really no choice here. You should inform your boss/payroll immediately. Either you tell them, or they'll find out eventually and withhold a future paycheck and, at best, just think much less of you or, at worst, fire you.
posted by thirdparty at 11:20 AM on December 1, 2004

Funny. This just happened to me. My company had an error occur when running payroll. Today, the error has been corrected and the double payment removed from my account. The company has also sent an apology to everyone this impacted.

Don't touch the money. Contact your payroll supervisor.
posted by onhazier at 11:31 AM on December 1, 2004

It sucked for me when this happened, because they took a larger percentage out for taxes, and didn't reimburse any of that when I paid back half of the money they gave me. Sure I got the difference back with my tax refund... a year later. I was super broke at the time, and therefore pretty upset about the whole thing.
posted by Eamon at 11:35 AM on December 1, 2004

Any chance they've changed the pay schedule? Changed from weekly checks to biweekly, or semimonthly to monthly, or something like that? Echoing the advice of others above, a call to payroll would easily check that.
posted by DevilsAdvocate at 12:01 PM on December 1, 2004

The obvious answer is blow and hookers
posted by Steve_at_Linnwood at 12:22 PM on December 1, 2004

First of all, unlike credit cards and the like, they CANNOT just take the money back via an EFT. With your bank, it's a one way deal, they'd need to get your authorization before taking the funds back.

Unless the figure was so great that you could quit the job, or unless you were thinking about quitting the job anyway, I'd tell them about it and figure out a way to give it back.

Don't forget, there very well might be tax issues at stake with giving it back or keeping it.

P.S. This happened to a friend of mine, but instead of doubling the money, she got someone the amount one of the VPs was supposed to get. She probably made 28k or so a year and this one cheque was for 26k. She spoke too soon, but if we all told her she should just quit and walk. ;)
posted by pwb503 at 12:24 PM on December 1, 2004

This is part of the ACH system and the bank initiating the deposit for your employer is responsible. I know because I worked in this area of banking for several years. A bank employee will notice it at the end of the day and initiate a correction (they won't balance - double posts are easy to find). The money should vanish after the next cycle - sometime in the early morning for most banks.

First of all, unlike credit cards and the like, they CANNOT just take the money back via an EFT.

What you mention is a true payroll error on the part of the employer. ACH is run by the Fed and, as I mentioned, double posts are a problem inherent in the system. Screw with the money and you are going to get hosed.
posted by rotifer at 12:30 PM on December 1, 2004

If they notice, and they most likely will, the payroll company will simply inform the bank of the error and the bank, without your permission, will remove the money from your account. That's if the error is with the payroll company. Despite what pwb503 believes, I've seen banks correct these mistakes several times. This happened to our company once, we all wondered the same thing. You have no legal right to that money if the payroll company disputes the legitimacy of it. However, there may be a time limit to how long they can dispute it. In my case, it was disputed two weeks after it was deposited and removed promptly.

As far as your obligation to your employer, it's not your job to verify the payroll company is doing their job. If your friendly with the owner or management, you may wish to tell them, but otherwise there is not much in the way of recourse the employer has if you do not. The law sides with them regarding payroll errors, it's their money. The law sides with you if you don't notice or don't inform your employer of payroll errors. They most certainly will not fire you if you fail to notice the error.

Alternatively, they may withhold future pay if the payroll company opts not to report the error to the bank.

Again, this is not your fault or responsibility. Unless you work in HR or are a part of an in house payroll staff and caused the error, you are blameless.

For what it's worth, if you spend the money and it's reported by the payroll company as an error, you will still see the money removed from your account. This is true even if you would go below a zero balance. In that case, you will be responbsible for any overdraft fees, not the payroll company. You may be able to have the fees removed, but that depends on the bank and your luck with CSRs.

rotifer, it is possible that the money was not just double deposited erroneously. When it happened to us, it was also double withdrawn. This was an error on the payroll companies part, not the banks part. This meant the banks saw balanaced numbers and didn't report any problems.
posted by sequential at 12:45 PM on December 1, 2004

sequential:"As far as your obligation to your employer, it's not your job to verify the payroll company is doing their job."

What about just being honest and not looking for loopholes to keep something that doesn't belong to you?

"Unless you work in HR or are a part of an in house payroll staff and caused the error, you are blameless."

I call bullshit. If you keep something knowing it is not yours you are anything but blameless. In New York it is actually a crime.
posted by cedar at 1:31 PM on December 1, 2004

Are you sure you're not just getting more $ because by this time of year you've already maxed out on your 401K contribution normally deducted from your check, and you're seeing that money instead come directly to you?
posted by onlyconnect at 1:46 PM on December 1, 2004

First of all, unlike credit cards and the like, they CANNOT just take the money back via an EFT. With your bank, it's a one way deal, they'd need to get your authorization before taking the funds back.

Maybe that's how it should be, but it's not the case. I had a slightly different problem earlier this year. Upon leaving a job, my paycheck was deposited, and then completely pulled back out (after I had verified that it had been deposited), even though the majority of that money was earned. After some services charges and long phone conversations with my previous employer, everything worked out. Apparently, they can reverse a portion of a transaction, but in this case, they had reversed the entire thing, leaving me high and dry for a weekend.
posted by trox at 1:53 PM on December 1, 2004

This is kind of a no brainer. If they screwed up enough for you to retire, buy an island and declare yourself dictator for life than run away as fast as your little legs will take you.

If they screwed up a thousand bucks then call payroll and get it sorted out.

cedar, you're right, you aren't blameless in a situation like this. In fact, they might be testing your honesty by doing it on purpose and it looks like you're failing so far.
posted by fenriq at 1:57 PM on December 1, 2004

You should read the paper you sign when you enroll in direct deposit. They reserve the right to correct mistakes by taking funds out. This has sometimes lead to major withdrawals over contested amounts at the time of termination.
posted by caddis at 2:05 PM on December 1, 2004

If they notice, and they most likely will, the payroll company will simply inform the bank of the error and the bank, without your permission, will remove the money from your account.


Banks can do this in USA? Strange indeed.
posted by madman at 2:17 PM on December 1, 2004

I know someone who kept the money from a banking error. She is now blacklisted from having a bank account in the US. Not fun.
posted by goethean at 2:34 PM on December 1, 2004

Give it back. They all ways find that. That's THEY ALWAYS FIND OUT. ALWAYS.
posted by feelinglistless at 2:49 PM on December 1, 2004

many (in fact, i'd say "most") direct deposit enrollment forms [all links .pdf] authorize the depositing agent (payroll or whomever) and your bank to correct errors without the input of the holder of the account. (this is why you should read forms before you sign them) even so, it makes good sense to be involved in your accounts enough to know who is putting money into and taking money out of your accounts (and in what amounts) even if you've given them more or less blanket permission to do so.
posted by crush-onastick at 2:58 PM on December 1, 2004

Once, long ago when we got company bonuses, the bonus was put in via direct deposit before it was announced that we were getting said bonus (make sense?). So it appeared that I was paid double the usual amount.

Expecting a bonus?
posted by jazon at 3:09 PM on December 1, 2004

What about just being honest and not looking for loopholes to keep something that doesn't belong to you?

I don't make a habit of making decisions for other people, especially not moral judgements. If you are inclined to be honest, tell your employer.

As for looking for loopholes, that's capitalism for you. As has been pointed out, your direct deposit is governed by a contract you enter into when you sign up for direct deposit. You assign some rights to the bank and payroll company handling your direct deposit in exchange for the convenience. They use every power assigned to them, explicit or otherwise, to their advantage. Why shouldn't you?

I call bullshit. If you keep something knowing it is not yours you are anything but blameless. In New York it is actually a crime.

Call bullshit all you want. There is no obligation, unless your contract with your employer or your direct deposit agreement states otherwise, for you to verify your direct deposit. That is the sole responsibility of the employer and those your employer hires to carry out the direct deposit. (It's in your best interest to verify your direct deposits, but that's an entirely different topic.)

It is not in your best interest to try to keep the money, by the way. These types of errors are easy to spot by the bank, the payroll company and the employer. It may take some time, but there are mechanisms in place to protect all of the involved parties and the interested parties will eventually notice.

If you were an employer who mistakenly overpaid an employee, but has none of the protections discussed in this thread available, you can still legitimately withhold future earnings until the discrepancy is accounted for. Why would it be to the benefit of the employer to pursue legal recourse if the employer was not already looking for a reason to terminate the employee? Are you that certain it's easy to prove the employee knew the deposit had been made in error? There are countless and legitimate reasons, in absence of hard proof otherwise, that the employee may not know a mistake had been made.

In fact, they might be testing your honesty by doing it on purpose and it looks like you're failing so far.

If your employer is doing this, I'd suggest calling your state's AG. The "I was testing them to see if they are honest." defense is weak at best and may be against the law in your state.

I know someone who kept the money from a banking error. She is now blacklisted from having a bank account in the US. Not fun.

The bank has absolute control of your money while it is in their possession. (Banks are regulated and insured. It is your money, but you willingly give it to them to do what they will with it.) The only way you can keep money from a bank error is to go in debt to the bank by skipping out on your obligations to the bank. That means your account has a negative balance, which may show up on your credit report or any of the systems banks use to screen potential new customer. Considering there are numerous credit reporting agencies and screening systems, the odds are that your friend can get a bank account, but it might take some effort or using a smaller, local bank.
posted by sequential at 3:32 PM on December 1, 2004

This happened to me. They asked me to make out a cheque to them for that amount and they reimbursed me the usual route. I thought the extra money was legitimate; I had a medical expense that didn't go through the agency's insurance. Payroll didn't forward my pay stubs when I transferred within the agency so I didn't see the calculations.

My grandfather received my grandmother's pension cheque for two months after she died. They eventually asked for it.

>These types of errors are easy to spot by the bank, the payroll company and the employer.
I agree with that. Your deposit is an outlier on the payroll statistics. Outliers are easy enough to spot.
posted by philfromhavelock at 3:43 PM on December 1, 2004

pwb503 is wrong--they can take the money back without your consent. It's not your money.
posted by grouse at 4:16 PM on December 1, 2004

Same thing happened to me a couple years ago. Just wait a few days and the "extra money" will be taken back out when they notice. Don't touch it.
posted by mrbill at 5:10 PM on December 1, 2004

"I don't make a habit of making decisions for other people, especially not moral judgements."

Yeah, we wouldn't want any of that nonsense. Why, the entire capitalist system depends upon us taking other people mistakes.

Just stop it. Stop the babble, stop the legalese and use some common sense. This isn't the foundation of the economy we're talking about, it's what one guy should do with the proceeds from his employers mistake.

You do the right thing, or you the wrong thing. I can respect either. What I can't respect is using double talk and obsfucation to justify something you damn well know is dishonest.

See, the deal here is the poster knows it was a mistake and isn't his money. He may not be required to monitor his account to look for errors such as this, but that ship has sailed. Now it's a matter of intent and you better believe that knowingly keeping the funds of another is not legal in very many places.
posted by cedar at 5:15 PM on December 1, 2004

burn that mother down!
posted by jackofsaxons at 7:43 PM on December 1, 2004

I don't know how your absolute morality helps answer the question, cedar, but the City of New York Procedures for Recouping Payroll Overpayments to City Employees (pdf) (html) doesn't seem to agree with either of us. It turns out overpayment is an issue New York City has dealt with in fine detail, at least in regards to city employees. In this specific case, there are procedures to protect the rights of the employee and the employer. There's no indication the employee has any obligation to inform their employer, ostensibly the city and citizens of New York, of such an overpayment.

An integral part of each agency's payroll responsibility is to detect, correct and recoup overpayments made to employees.

If this isn't abundantly clear, this is not meant to be legal advice. If you should need legal advice, seek the services of a laywer.
posted by sequential at 10:13 PM on December 1, 2004

I would not touch it but also in addition to calling write ssomething on paper briefly noting the incident and sending it over to payroll as proof. Some payroll people are pretty incompetent and you want to cover yourself in case they thought you somehow created or helped create the situation. It also could earn you brownie points someday.
posted by calwatch at 10:18 PM on December 1, 2004

sequential: along the lines of not being legal advice it may be worth considering that NY Section 155.05 of NY State penal law defines larceny (in part) as 'acquiring lost property' and goes on to say:

A person acquires lost property when he exercises control over property of another which he knows to have been lost or mislaid, or to have been delivered under a mistake as to the identity of the recipient or the nature or amount of the property, without taking reasonable measures to return such property to the owner. [emphasis mine]

Simply put -- if it isn't yours it's against the law to keep it. This certainly cannot be superceded by bank or company policy. Sure, it isn't something likely to be pursued in these circumstances, but it would really suck to be the guy they made an example of.

I'll be putting down the whip and stepping away from this horse now. I don't think it's alive anymore.
posted by cedar at 4:40 AM on December 2, 2004

Ignore it, don't tell anyone, and don't look at your account for a while. If it's still there in a few months, you're lucky. :)

They don't always notice, trust me.
posted by cell at 4:41 AM on December 2, 2004

cell wins.
posted by chundo at 3:00 PM on December 2, 2004

By the way, if you happen to be a member of a union, check your contract or MOU. They often have clauses that discuss how overpayments can be recovered. See, for instance, this contract from the County of Los Angeles (PDF page 34) that states that if you are overpayed by more than 15%, the recovery shall not exceed 15% per month of "disposable income". Therefore, if you were double paid a month, you could legally hold the money and pay it back over a seven month period, although I'm sure you will be coerced to "mutually-agree" on a faster payment schedule.
posted by calwatch at 9:14 PM on December 2, 2004