What are my options other than collecting a tiny paycheck?
September 19, 2022 9:46 AM   Subscribe

Do I have any recourse when my employer offers to fix their problem that I found by taking my money?

My wife and I recently switched to a health/vision/dental plan offered by my employer instead of her employer, which has been active since September 1. But I noticed that the deductions didn't come out of the first paycheck that should have had deductions.

I guess I shouldn't have waited. I assumed it would work itself out, but it didn't. After the second paycheck was the usual size instead of the reduced size, I let my employer know. They thanked me for catching the error and said they'd fix it by taking double deductions out of this Friday's and next Friday's paychecks. Thanks, I guess?

This is my introduction to the health plan offered by my company, and I'm not happy about it. I understand that all the numbers need to get sorted out, but I feel like I'm being penalized for my employer's error.
posted by emelenjr to Work & Money (8 answers total)
I feel like I'm being penalized for my employer's error

You aren't. You are paying the agreed to amount for the services provided. You collected an "extra big" paycheck for two pay period - having an "extra small" paycheck makes up for that. Your employer does not take the responsibility for your cash flow.

What are my options other than collecting a tiny paycheck?

You may be able to negotiate double deductions periodically - for instance, one pay period of double, one pay period of single, one pay period of double - if that helps you out. However, they are not, so far as I can tell from your description, overcharging you for the health care.
posted by saeculorum at 9:51 AM on September 19 [24 favorites]

They paid you too much the first two pay periods, so now they are correcting that by taking the money from the next two pay periods. In total, you aren't paying any more than you should have been. They're just taking back the extra that they paid you by mistake.

This is a normal thing. For example, I have had my bank accidentally put money into my account. Then a few days later they took it back. It was never my money. I could have withdrawn it during the few days it was there, but if I had, the bank would still have had the right to ask for it back. If I refused, they could demand it.

If it is a hardship for you to repay the money over two pay periods, I suggest you ask your employer to spread the deduction out over a longer period of time.

This may be inconvenient for you, but at least you caught it quickly. Imagine if this had gone on for six months. They could still have asked for the money back, but it would have been a lot more!
posted by Winnie the Proust at 9:53 AM on September 19 [2 favorites]

That seems very normal to me. It's not really a penalty, as it's the same amount, just that it's getting taken out at a later time.

A "penalty" would be more like, if the insurance provider charged a late fee, and then they passed the fee on to you. And that's not what's happening here.

As someone who has done these payroll changes and deductions in the past, how it works in the background is that your company has been paying premiums for everyone including you, which is why your coverage was still active. But they forgot to take it out of your paycheque at the right time. So now they are just playing catch-up. You could probably ask your payroll administrator to distribute the deductions over a longer period of time, if cash flow is an issue (i.e. take out the two missing deductions over four to eight Fridays, rather than just the next two Fridays).
posted by tinydancer at 9:55 AM on September 19 [2 favorites]

Response by poster: I'm realizing this is more venting than anything else. I'm going to mark it resolved. Like I said, I get that the numbers need to be reconciled. Everyone's answers were sensible, so thank you.
posted by emelenjr at 10:02 AM on September 19 [8 favorites]

This is a timing issue not a calculation issue.
posted by JohnnyGunn at 10:34 AM on September 19

I do payroll and stuff like this happens from time to time. If anyone is ever upset or in a potential bind (which: please speak up) about the proposed way to fix an overpayment, I'll happily work folks onto a mutually reasonable repayment plan.

For your situation, the longest I would go is repayment over 4 pay periods vs 2.
posted by phunniemee at 10:39 AM on September 19 [7 favorites]

If it causes you an actual hardship, like you can't pay for rent or groceries (not just that you're miffed) you can ask and they may be able to spread the premiums over several pay periods.
posted by epanalepsis at 11:28 AM on September 19 [3 favorites]

Yes! Ask them to spread it out more. It can't hurt to ask and most reasonable employers would at least consider stretching it out a little more.
posted by Mid at 11:33 AM on September 19

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