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Tina, Lawyer
Category: Employment Law
Satisfied Customers: 33166
Experience:  JD, BBA, recognized by ABA for excellence.
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What laws are there governing direct deposit reversal by employers

Resolved Question:

What laws are there governing direct deposit reversal by employers? I recently had vacation and sick pay direct deposited by my former employer and I verified this with a phone call to the bank and also received a statement of the deposit from the employer. The deposit was reversed within 3 days unknown to me (this was January 26th). I received my bank statement February 19th and saw the reversal and this was the first I learned of it. The same day I also received overdraft notices as well. Are employers required to provide notification when reversals occur and would the employer be held accountable for the overdrafts?
Submitted: 7 years ago.
Category: Employment Law
Expert:  Tina replied 7 years ago.

Thank you for contacting our JA team for guidance.


What state are you in? Was this money owed to you because you recently left your employment or for some other reason?

Customer: replied 7 years ago.
I am in Kansas. Yes, the money was owed to me and I left employment due to lay-offs.
Expert:  Tina replied 7 years ago.

Hi Robin,


You should do two things. First, contact your state labor commission because you were not paid all compensation due to you upon your lay off. This agency has the authority to recover the amount you should have been paid and assess significant penalties against the employer.


In addition, you should contact an employment law attorney in your area. The employer can likely be held liable for breach of contract, along with all foreseeable costs and expenses you incur attempting to recover the amount that is due to you. Look for an attorney who offers free consultations and takes contingency fee cases.


Best regards,



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