Legal Question in Employment Law in Pennsylvania

Payback of bonus erroneously issued

Company A outsourced me as of 6/1/06, also retired from Company A as of 5/31/06. Signed work agreement with Company B that included salary, incentives and explanation of pro-rated bonus for 06 based on months with company A vs. company B. Company A issued bonus check in July 06 to retirement-eligible employees in error (check was not marked what it was, had no accompanying explanation). Now (4 months later), company A claims they made a mistake and is demanding either repayment of the bonus or agreement to have it applied towards the actual bonus to be awarded by Company B the first part of 07. They are using the fact that we signed the work agreement with Company B as leverage for us to repay the money. My question is, can they demand that we pay them back within 2 weeks? (they gave no amount due or how taxes would be handled) They also threatened to begin collection activity if I did not select one of their two options within 2 weeks. Although I agree that they screwed up, I'm incensed that after 20+ years, Company A felt it necessary to threaten me with legal action if I didn't return their letter with my choice immediately, yet they didn't even give me the check #, date, amount, return postage etc. How should I proceed?


Asked on 11/10/06, 9:20 pm

1 Answer from Attorneys
Roger Traversa Arjont Group (Law Office of Roger Traversa)

Re: Payback of bonus erroneously issued

You asked about return of a incorrectly paid bonus.

You are correct that the business needs to present clear explanation of what happened and when. They need to prove how much is owed and where it came from. Also, they need to provide a reasonable amount of time for repayment. Most likely, they are correct that you cannot keep the money. they are not correct that it is a collectable debt until they prove it to be se.

You can stand your ground but if you are prepared to catch a lot of flak. This could even include minor interference with your current employment (which may or not be actionable).

You should get the advice of an attorney with whom you can investigate the matter in more detail.

Regards,

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Answered on 11/11/06, 12:37 pm


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