Financial Services Manual (FIN)

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Effective: 8/01/2010

Revised: 9/12/2011

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FIN 602: Wage/Salary Overpayment Responsibilities

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Purpose

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To identify the responsibilities of employees, departmental administrators and Payroll Services regarding overpayments

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Sources

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Arizona Revised Statutes §35–301, Duties and liabilities of custodian of public monies; violations; classification
Arizona Revised Statutes §23–352, Withholding of wages
Arizona Revised Statutes §38–601, Effect of payment of legal salary

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Applicability

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All current or former employees who received an overpayment of wages or salary
All departmental representatives charged with responsibility for reviewing their department’s payroll expenses

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Policy

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All wage or salary overpayments must be promptly reported to Payroll Services. Departments are not authorized to overlook or forgive any overpayment.

An employee who discovers that he/she has received an overpayment of wages/salary must immediately notify the departmental administrator. Once the employee has received a Payroll Deduction Agreement and overpayment calculation schedule, he/she has 10 days to sign and return the Agreement to their departmental administrator, or to communicate the specific reason why the form has not been signed.

A departmental administrator who discovers an overpayment or receives notice of an overpayment must immediately notify Payroll Services. If the overpayment occurred on a sponsored project account, the departmental administrator must immediately move the overpayment to one of the department’s local accounts. The departmental administrator is responsible for notifying the employee of the overpayment and making sure they receive the Payroll Deduction Agreement and overpayment calculation schedule. Once the Payroll Deduction Agreement is signed by the employee, the departmental administrator returns the form to Payroll Services.

It is the responsibility of Payroll Services to make timely and accurate wage/salary payments to university employees based upon information provided by university departments and in accordance with applicable state and federal laws. When overpayments are identified it is the responsibility of Payroll Services to provide the departmental administrator a Payroll Deduction Agreement and overpayment calculation schedule to provide to the employee. Payroll Services will set up payroll deductions per terms of the Payroll Deduction Agreement and ensure all tax reporting is correct.

In the event of a final paycheck of an employee leaving ASU employment, the full amount of the overpayment, up to the total amount of the final paycheck, may be deducted. If an employee is not due a final paycheck due to an overpayment, he or she shall be notified in writing.

Specific procedures regarding overpayment repayments are available in the Payroll Section of the HR Business Center.

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Cross-Reference

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See also the Research and Sponsored Projects Policies and Procedures Manual RSP 502–01,“Personnel Employed on Sponsored Projects.”

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