Career Advice

Former Employer Accidentally Paid Me, What Should I Do?  

You would probably feel like it’s a holiday if you opened your bank account and realized your former employer accidentally paid you. However, it might not be a good idea to get too excited about it. This piece will discuss the question, “What do I do if my former employer accidentally paid me?” and some related questions.

My former employer accidentally paid me. Why?

There could be many reasons you receive additional funds after you separate from a place of employment, and not all of them are accidents. These are some of the most common:

You worked during a new pay cycle.

One reason you might receive money after you separate from an employer is if you earned a few days of pay on a new pay cycle. Sometimes, employers have strange biweekly pay cycles that end on abnormal days.

Thus, you may have entered a new pay period before you resigned or got fired. Check to see if you have an online pay stub for the money. If so, it’s yours; you can spend it on whatever you like.

The employer gave you paid personal time.

Some employees earn paid personal time when they work, and the employers pay them for the unused portion when they separate. That may be why you received a separate payment from your employer long after you left the company.

It’s highly likely if you were a full-time employee with benefits. In that case, you don’t need to ask, “Do I have to pay back money paid to me by mistake?” You can enjoy your PTO payout.

They found a discrepancy.

Your employer may have found a discrepancy with your benefits deductions or something else, and the payment could have been a refund to correct that issue.

Payroll made an error.

The payroll department is full of human beings who make errors from time to time. Thus, perhaps your company accidentally sent you a check when your payments should have stopped, and you had accrued no hours. It’s probably a human error if you can’t think of any other reason your former employer would do that.

The software glitched.

Businesses are big on technology, AI, and software for all types of things, including payroll. It’s possible that the payroll software had a meltdown or went into overdrive, causing it to issue checks to the wrong people.

Someone else accidentally used your logins.

Here’s where things could get illegal. While there’s no logical reason someone would intentionally use your logins to clock in, it’s possible that it happened. This incident is more likely in workplaces that use old-style login systems.

Many employers are moving to biometric logins and computer chip badges these days. However, there’s a chance that someone accidentally or intentionally used your information to sign into work for a long time. If that’s the case, someone will be looking for their money soon.

Someone likes you Very much.

Another unethical reason your former employee might keep sending you money is that you have a secret admirer. Perhaps someone in management or payroll wishes you good fortune. Maybe they “accidentally” adjusted your time and forgot to take you out of their system. If so, it will catch up with them one day, and it may cause you problems in the future. You may be saying, “I’m happy my former employer accidentally paid me,” but it can come back to haunt you in the end.

Can you keep the cash if a company accidentally pays you money by mistake?

You can keep anything you receive in the mail or via direct deposit with your name on it. Whether it’s morally or legally acceptable is a different story.

First, you must determine if a company paid you by mistake. You can do that by reviewing the most common reasons for getting paid after quitting or getting fired. Once you determine the company did indeed overpay you, you have to make a decision. These are your options:

Keep the money and spend it well.

You can choose to do what you believe is right or wrong here. Life is full of choices, and you get to make a crucial one when you receive an overpayment.

Contact the employer and let them know.

You could contact the employer on your own and notify them that they made a gross error and overpaid you. They might thank you for your honesty and be willing to work out something with you.

There’s also a chance that they’ll let you keep the money, but don’t count on it. Make a repayment arrangement with them if you have already used the money for your bills. They may allow you to pay them in monthly installments.

What can the employer do if you keep a payment they sent you accidentally?

Now you might wonder, “What could happen if a former employer accidentally paid me?” The employer has several options based on the laws in the state where you live.

First, they can contact you to see if you will own the error and offer to repay the funds. They can employ the services of a collection agency as well.

In some states, the employer may have the option to deduct the overpayment from the bank account they sent you. This option is not available in all states. For example, the state of Iowa prohibits employers from taking such actions.

Employers have the right to take you to court to retrieve their funds, however. They will have even more rights if a judge rules that you have to pay the money back.

Now you know the answers to, “My previous employer over paid me. Do I have to pay it back?” and “What do I do if my former employer accidentally paid me?” You also know various reasons you might receive money after you separate from a workplace and some of the ways you and your former employer can handle the overpayment.

Use the information wisely and make the most suitable decision if you ever receive money in your paycheck, and you believe your former employer’s company accidentally pays employees. Investigate the payment to determine why you received it, and then do something honorable. You will save yourself from a world of trouble by doing the right thing in the beginning.

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About Author

Founder of With over 20 years of experience in HR and various roles in corporate world, Jenny shares tips and advice to help professionals advance in their careers. Her blog is a go-to resource for anyone looking to improve their skills, land their dream job, or make a career change.

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