Can an employer reclaim wages from an employee without the employee’so consent?

UPDATED: Sep 30, 2022

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Can an employer reclaim wages from an employee without the employee’so consent?

The employer erred and overpaid wages. They now want to reclaim those wages. What is the law regarding this here and does it differ in other states? The company has stores and employs people in all 50 states.

Asked on May 7, 2016 under Employment Labor Law, Alabama


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

No, the employer may not "reclaim" wages from an employee, either by taking them out of the employee's bank account or by reducing future wages, without the employee's consent. (With one exception: if there is a check or direct deposit which has not settled yet and which is for the wrong amount, they can cancel it and replace it with the right amount.)
But that does not mean the employee can keep an overpayment: the law is very clear that if someone is paid extra due to some administrative, technical, or even plain human error, that the person has to return the money--a mistake gives no right or entitlement to funds. If the employee does not return the money voluntarily, the employer has the right to file a lawsuit for the funds. If the employer can prove the overpayment in court, they can get a court judgment--an order--requiring repayment. And if wages truly were overpaid--i.e. the employee was accidently paid more than he/she was entitled to given his/her then-current wages or salary and the hours or days worked--the employer will win that lawsuit.
So while the employer cannot simply take the money back unless the employee lets them, they could sue and get the money that way.
Also, unless the employee has an employment contract which by its terms would prevent them from being terminated in these circumstances, an employer could certainly terminate the employee for being unwilling to return money to which he/she is not entitled.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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