Staff Personnel Manual (SPP)

Effective: 7/25/2008

Revised: 8/13/2009

SPP 405–02: Overpayment

Purpose

To clearly state the policy for wage or salary overpayments and repayment to ASU

Sources

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

Applicability

All current employees who received an overpayments of wages or salary

All departmental representatives charged with responsibility for reviewing their department's payroll expenses

Policy

All employees shall receive the wage/salary provided by law and shall not, under any pretext, receive any salary or emolument in excess of the wage/salary so provided.

A wage/salary overpayment occurs when an employee receives a wage/salary in excess of their current wage/salary. An employee is responsible for reviewing his or her paycheck and reporting errors immediately.

Procedures

Notification

It is the responsibility of each ASU employee to notify his or her departmental representative if they suspect an overpayment has occurred. The following individuals should be notified:

1. For amounts under $1,000, notify the Office of Human Resources (OHR) payroll representative.
2. For amounts ranging from $1,000 to $3,000, notify the OHR payroll representative with a copy to the payroll manager.
3. For amounts ranging from $3,000 to $5,000, notify the OHR payroll representative with a copy to the payroll manager and the assistant director of Payroll Administration.
4. For amounts over $5,000, notify the OHR payroll representative with a copy to the payroll manager, the assistant director of Payroll Administration, and the senior director of OHR.

It is the responsibility of each ASU departmental representative who has been notified of a suspected overpayment, or who suspects there may have been an unreported overpayment, to notify the Office of Human Resources.

Wage or salary overpayments, whether a system, department, or payroll error, must be promptly repaid to ASU. All overpayments must be repaid regardless of dollar amount. Departments are not authorized to overlook or forgive any overpayment. Upon discovery of an overpayment, OHR shall notify the employee in writing of the amount of the overpayment and the reason for the overpayment.

Each department is to comprehensively reconcile the payroll expenses for their department at least monthly to determine whether an overpayment or underpayment has occurred and to notify the individuals noted above, based on the overpayment amount, so that repayment can be obtained expediently.

Repayment

Employee repayment of overpaid wages or salaries can be repaid by personal check, money order, or cashier’s check. Employees may make a written request to have their repayment deducted in total in the next scheduled biweekly payroll run.

If the employee does not make full payment within ten days of being notified of the overpayment, OHR shall initiate payroll deductions.

OHR will utilize payroll deduction (whether voluntary or involuntary) as a method of repayment. Prior to the first deduction an employee shall be given notice of the amount that will be deducted from his or her paycheck and the period(s) for which such deductions will occur.

If the overpayment is to be collected over several paychecks, OHR shall calculate the amount to be collected per paycheck. The amount to be collected per paycheck is the overpayment divided by the lower of the number of pay-periods the overpayment was received or 26 pay-periods. The amount to be collected shall not be lower than $50 per paycheck for more than one pay-period.

Except in cases when the employee is leaving ASU employment, reductions of pay will not result in the employee receiving below state minimum wage for all hours worked and will not be deducted from overtime paid.

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.

It is best if the overpayment is repaid in the calendar year in which it occurred for wage and tax reporting purposes. Repayments made in the calendar year of the overpayment will result in a correction of current year wages for income tax purposes. Repayments made in the following year will require the gross amount less Social Security, Medicare, retirement, and long-term disability variances to be repaid.

Appeal of Determined Repayment Amount

An employee who wishes to appeal the amount and duration of the repayment can do so by filling out an Appeal Form and submitting it to the assistant director of payroll administration. Under no circumstance will the repayment schedule be longer than twice the number of pay-periods the overpayment was received for.

The associate vice president for Human Resources, or designee, shall make a final decision and notify the employee in writing of the final determination within five to seven business days.

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