Q: What recourse is there if a former employer cancels a deposited final check?
I deposited the final check from my employer. It cleared and funds were available in the account. The company later reached out and said an overpayment occurred and they had cancelled the check (it had been deposited already) and would issue a new check. This seems to violate section 221 of the California Labor and Employment Code regarding an employer's recourse in the event of an overpayment, as it must be voluntary. Were it stipulated that an overpayment did actually occur, but the employer violated the law in their recovery of the funds, what recourse, if any, do I have?
A: Was it actually an overpayment? Were you owed the funds? More details are necessary to provide a professional analysis of your issue. The best first step is an Initial Consultation with an Attorney such as myself. You can read more about me, my credentials, awards, honors, testimonials, and media appearances/ publications on my law practice website, www.AliEsq.com. I practice law in CA, NY, MA, WA, and DC in the following areas of law: Business & Contracts, Criminal Defense, Divorce & Child Custody, and Education Law. This answer does not constitute legal advice; make any predictions, guarantees, or warranties; or create any Attorney-Client relationship.
A:
The law does not allow you to keep an over payment. You will have a legal obligation to repay any amount overpaid. While an employer can re-issue a check made by mistake, once it is deposited and becomes your funds, the employer's only legal option is to ask you to voluntarily repay the money, or sue you to get the money back plus interest. It is in your best interest to simply acknowledge the over payment (if that is the case) and negotiate repayment of the money that does not belong to you.
Good luck to you.
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