Payroll Overpayments

University of California employees are not legally entitled to receive more money than they earned for each pay period. When an employee has been overpaid, an overpayment recovery plan is established to provide a method by which the overpayment can be recovered.

Common reasons for overpayments include:

Unpaid Exception Time: leave over-usage, unauthorized or unexcused absences
Wage Overpayments: timesheet errors, erroneous compensation rate, coding errors on job record, severance repayment, erroneous payment during unpaid leave of absence
Deduction Errors: insufficient withholding (or the arrearage of) a mandatory employee-paid tax or deduction

Any overpayment represents a legal debt owed to the University, which it has a duty and obligation to recover.

Reporting Overpayments

The overpayment recovery process begins when an overpayment is reported through one of the following actions:

An employee identifies a potential overpayment and reports it to their Manager, HR, or Payroll
HR submits an overpayment recovery request to the Payroll Office
Payroll identifies an overpayment; for example where there are:
- Retirement/FICA coding corrections
- and/or payroll adjustments due to timesheet changes

The Payroll Office is responsible for coordinating the overpayment recovery process and setting up any arrears deductions.

Collection Methods

Employee consent is required for an overpayment amount to be deducted from a future pay check or remitted via check or credit card. When contacted by HR, the Payroll Office will provide a letter containing a billing notice, amounts and tax implications, and a repayment agreement for the employee to indicate consent. The HR representative coordinates signing the repayment agreement with the employee, obtaining their consent, and communicating back to the Payroll Office to process the overpayment.

Overpayments are generally collected using the following methods:

Method 1: Payroll Deduction

One-time payroll deduction - Full repayment of the amount owed via payroll deduction from the employee’s next payment
Recurring payroll deduction - Recurring payroll deduction installments from a set number of paychecks until the overpayment is paid in full
- The overpayment may be recouped in the same number of pay periods in which the overpayment occurred.
- In the event the overpayment continued beyond 12 months, full repayment may be required within a 12 month period.

Method 2: Cash Payment

Personal Check - One-time payment in full or installment payments by personal check
- Make check payable to UC Regents
- Mail check along with a copy of the signed agreement to
  UCSF Payroll Office, Box 0815
  1855 Folsom St, Suite 425
  San Francisco, CA 94143

Overpayment Closeout

The process is complete when the full amount of the overpayment has been recovered and the employee’s earnings record is adjusted to reflect the repayment.