Return ‘accidental’ bonus or face pay cut later, Honda’s tells employees

Imagine being greeted by a festive bonus in your account, only to be hit by the reality that it was a mistake and you’ll probably need to give it back. Bogged down by the pandemic, global carmakers opted for pay cuts to navigate the crisis, but Honda turned to furloughs. Now that business is back on track in the post-pandemic era, the Japanese carmaker is in the news for asking employees to refund the bonus that it had deposited in their accounts.

Hundreds of Honda employees in Ohio had received the extra amount on their salaries earlier this month, but have now been told that they were overpaid. A memo sent out by the firm cited miscalculation of bonuses behind the accidental pay out, and gave them nine days to refund it. Caught in an embarrassing situation which will affect their families, employees can either return the extra cash or it’ll automatically be deducted from their next pay cheque.

Disappointing but not illegal

Although it’s natural for households to plan those big ticket purchases after receiving a bonus, Honda can legally ask for a refund under the Fair Labour Standards Act.

Not a first

Such incidents have also been reported in India where two digital assistants of a village secretariat were asked to return the entire salary paid to them, because they quit before completing two years in service.

In contrast, a government employee in Spain continued to receive 37,000 Euros every year from a water company, despite an absence of six years from work. After being caught, he had to pay back an amount equivalent to a year’s salary, which was the maximum that his employer could reclaim.