{1 - 24} GreyGrey
{25 - 49} GreenGreen
{50 - 499} BlueBlue
{500 - 4999} OrangeOrange
{5000 - 24999} RedRed
{25000+} BlackBlack

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I was overpaid, am I obligated to pay it back?

I am paid based on commission. I was never properly educated on how they figure out my pay each month. All I know is that I get 38.5% of my production for the month have a draw of $2,000.
I was informed they overpaid me by $7,500 over the last 4 pay periods. How does this even happen?!? and since it was not caught sooner I don’t think I should be held responsible, our payroll coordinator should!!!
HELP!!!



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1 Answer

This is a tough one because even though it was the payroll coordinator’s fault, you might still owe back the money. Think of it this way, if you were underpaid, you’d expect to be paid that underpayment. The same might apply for over-payment. Over-payment laws vary by state and how repayment should be done (taking small amounts out every paycheck to pay it back, for instance). Because of this, you may want to contact an employment attorney to find out the definitive law for your state regarding over-payment. I’d be careful saying that you weren’t properly educated on how to figure out your commission. I say this because an over-payment of $7500 over only 4 pay periods would be a large increase to your paycheck and it could be argued that it should have been obvious. They could also argue that it was part of your due diligence when taking the job to understand your pay structure. Basically, what I’m saying is that it might be easiest not to go down that path of coming up with reasons why you didn’t notice. It’s about over-payment and what to do now, nothing more.
 
I don’t know what a “draw” is, but to figure out your production, you take your production number and multiply that by your production percentage (38.5%). Here’s a link that walks you through the math: http://www.wikihow.com/Calculate-Commission

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