Recoupment of Overpayment Policy

Purpose

The purpose of this policy is to establish procedures to be followed when an employee has been overpaid. 

Procedures

Overpayment occurs when compensation that is not owed to the employee is paid in error. This may include, but is not limited to, overpayment of wages, leave payoff in error, erroneous refunds of deductions, etc. Unearned payments to employees are prohibited by Article 7, Section 14, of the Louisiana State Constitution, which prohibits the donation of public funds. As a result, McNeese State University is required to recoup overpayments from both active and separated employees.

Notification to Active/Separated Employee of Overpayment

Employees will be notified immediately in writing by the director of human resources and student employment once it is determined that an overpayment has been made. The notification to the employee will include the following information:

• Pay date(s) the overpayment occurred;
• Amount of overpayment;
• Plan of action for recoupment;
• Employee options for repayment; and
• University procedure for dispute of recoupment.

Recoupment from Active Employee

The following repayment options are available:

• Direct deposit reversal;
• One-time deduction from a subsequent paycheck;
• Payment plan (recurring deductions may be established for a period not to exceed 12 months) in accordance with internal procedures for such; or
• Personal payment from employee (i.e., check or money order).

If an employee who has been overpaid is separating from employment, the amount of overpayment will be withheld from the employee’s final paycheck. If the full amount is not recovered, then the guidelines below for recoupment from separated employees will be followed. 

Recoupment from Employees Transferring to Another State Agency

If an overpaid employee is transferring to another state agency, and the recoupment process has not yet been completed, the Office of Human Resources and Student Employment will notify the new agency that the employee has an outstanding balance due. The University will collaborate with the new agency to determine a reasonable approach for recovering the overpaid amount from the employee and ensuring that any funds collected are returned to McNeese State University.

Recoupment from Separated Employees

The following repayment options are available:

• Personal payment from the separated employee (i.e., check or money order); or
• Payment plan (multiple payments may be established with the University in accordance with internal procedures for such; the period of recoupment may not exceed 12 months).

If the University is unable to recover overpayments from a separated employee, the comptroller will be notified to begin the collection process.

Employee Dispute

If the employee disagrees with the identified overpayment, they must provide a written statement of disagreement to the director of human resources and student employment, along with any supporting documentation, no later than 15 business days from the date of the overpayment notification. The University will review the dispute and render a decision. Based on this decision, the University will either proceed with recoupment in accordance with this policy or dismiss the recoupment process.

Communication

This policy is distributed via the University Policies webpage.