Never before Covid-19 has the world so appreciated grocery store employees. They have kept everyone fed while the world has shut down and at personal risk. Grocery store giant Kroger offered employees emergency pay, but, unfortunately, a few employees were overpaid.
This happens. It's not a sign of a bad payroll system--it's just a sign that when things change rapidly, mistakes sometimes occur. In this case, the payroll department sent out an email asking the employees to repay the overpayment.
This is not a problem. Paychecks should be accurate, and a mistake on either end should be fixed. However, the problem comes from how they asked, or instead demanded, the repayment.
Kroger asking workers to return some of the extra pay they received pic.twitter.com/WPtAsYRAOb-- steele (@laborseller) May 18, 2020
Note the bolded line: Failure to repay the overpayment could result in further collection efforts.
Threatening to send your employees to collections for a mistake you made is not only bad policy, but it also plays poorly on the internet.
At some point, your business will make a payroll mistake in favor of the employee. It's essential to make sure your team understands how to fix these errors. Here are things everyone should think about.
- Is the repayment that important? It's important, legally and morally, that you pay your employees every penny they earn, but if you accidentally overpay them, how important is it to recover the money? The answer depends on your business, the overpayment, and how many people were involved.
- How will this look on the internet? You no longer need a public relations firm to get the news out there. One employee can take a snapshot and have your letter go viral. It's okay to note that there was an overpayment and ask for money back, but it's not okay to threaten.
- Understand that people spend what they receive. Grocery store workers have been working like crazy, and with a bonus, they wouldn't suspect that their check was inaccurate. They thought it was their money and they spent it. If you ask for it back, do so with the option of an extended repayment plan.
- Train all managers in communication. It's not unusual for many people to communicate with groups of employees. Have you trained them on how to do it and instructed them whom they should ask if they have questions?
In the case of Kroger, it decided to rescind the requirement to repay. A Kroger spokesperson told me via email,
We've instructed our payroll department to directly inform the small number of associates affected by the recent overpayments of Emergency Leave of Absence pay that we will not seek repayment.
With all the rapid changes every business is going through, mistakes will happen. How you correct those mistakes makes the difference between being seen as a good employer or a bad one. Proceed carefully.