Repay overpaid Social Security benefits

ssi benefits

Pre-qualify in 60 seconds for up to $3,345 per What Is Back Pay? When Do I Need To Pay It? and 12 months back pay. How Back Pay is distributed will depend on whether a claimant is approved for Social Security Disability Insurance benefits, Supplemental Security Income benefits, or both. Talk to your attorney about your case and how to make your employer pay for the work you were never compensated for.

How do back pay work?

Back pay is payment for work done in the past where payment was not made at the time work was performed. The employer must make up the difference between what the employees were paid, if they were paid, and what they should have been paid.

The SSA agrees that you are disabled, but finds that your disease did not actually progress to the point of actually constituting a disability until July 1. Your application is approved and your monthly payments are scheduled to begin the following January. On January 1, you are in an accident which leaves you disabled. You are certain your disability will last for longer than 12 months. Therefore, you decide to apply for SSDI benefits right away, and your application is submitted on February 1. Your application is reviewed and the SSA agrees that your disability began on January 1.

What is back pay, and what is retroactive pay?

There is a statute of limitations on back pay, meaning employees have a limited window of time to sue for these wages. Generally, for unintentional wage violations, employees can recover up to two years of back pay.

  • In addition, SSI Back Pay is paid incrementally only, meaning you won’t receive all of you Back Pay in a lump sum as you would with SSDI.
  • Retro pay is usually necessary because of simple human error with payroll.
  • Manage labor costs and compliance with easy time & attendance tools.
  • Back pay is a type of retro pay in which an employee is owed all their wages for a pay period after that period’s payday.
  • If an employee has been discharged or fired unlawfully, that employee could be due back pay because they were being illegally prevented from doing their work.

We provide third-party links as a convenience and for informational purposes only. Intuit does not endorse or approve these products and services, or the opinions of these corporations or organizations or individuals. Intuit accepts no responsibility for the accuracy, legality, or content on these sites. Wage and Hour Divisionof the Department of Labor, which can assess your eligibility for back pay and supervise payment. Employees Everything you need to know about managing and retaining employees. Accounting Accounting and bookkeeping basics you need to run and grow your business.

How is back pay calculated?

If so, you will owe them retroactive pay , and you’ll need to make a payroll correction. Back pay may also come into play afterwrongful terminationas the amount of salary and benefits that an employee claims to be owed after being improperly fired. Back pay is usually calculated from the date of termination to the date a claim was finalized or judgment determined. If an employee was unfairly prevented from completing a job for some reason, they might also be eligible to collect back pay.


If there is a legal dispute regarding the wage claim, payment could be delayed until a resolution is reached. Employers may also want to consult with legal counsel so that any back payments to employees are made in a way that manages their legal exposure. Remember, California wage and hour laws require employers to pay your attorney’s fees in successful unpaid wage lawsuits, which means this fee will not reduce your total recovery. If you are owed back pay and wages, you can recover back wages by filing a wage and hour lawsuit. You applied for benefits on February 1, but your eligibility for SSDI did not begin until June 1. That means that you are not entitled to receive retroactive pay.

Fast, easy, and accurate payroll with BambooHR®.

Additionally, back pay doesn’t just apply to certain classifications of employees. Whether you’re an hourly worker, a salaried employee, a freelancer, or a contractor, you can be entitled to back pay. If an employer withholds your pay, whether intentionally or unintentionally, you may be entitled to back pay. This means that you will compel the employer to pay you the wages you’re owed.


Back pay is typically calculated from the date of termination to the date a claim was finalized or judgment was rendered. If your employer is violating wage and hour laws against you, they may be doing it to multiple employees. This may mean your case can become part of a class action lawsuit on behalf of a large number of employees. A bonus or merit pay increase earned in one pay period isn’t always applied to that period’s paychecks. In some cases, you won’t be able to add that bonus to the employee’s paycheck until the next period. When business processes involve large numbers of calculations, mistakes are inevitable.

If the and Labor Division determines that a violation has occurred the employer may be forced to pay restitution under the Fair Labor Standards Act. Back pay doesn’t just mean money that has been withheld based on the amount of hours that have been worked. It also can be a pay increase that was not honored or a bonus that was never received. Additionally, if a worker was prevented from completing work for a particular reason, he or she could be owed back pay if wages were withheld.

  • When you pay employees retro pay, you still need to withhold payroll tax.
  • In short, back pay is when you pay an employee missed wages that you should have paid them in the first place.
  • An employee can file ​a private suit against an employer for back pay plus attorneys’ fees and court costs.
  • If the employer was found to be in violation of the contract then the employer may owe back pay under the Fair Labor Standards Act.

If an employer fails to pay the wages due to an employee, they will then owe the employee back pay. Read our guide to learn more about back pay and the consequences of not paying back pay. An employer who owes back pay must repay the full value of the employee’s salary and benefits, from the date the underpayment began until the claim is filed, finalized, or judgement rendered. Employees may also be eligible for damages or attorney’s fees.

Back pay calculation example for hourly employees

Focus on what matters most by outsourcing payroll and HR tasks, or join our PEO.

  • Courts may also require employers who owe back pay to double the amount to be paid.
  • However, other workers raised concerns about the length of the agreement, back pay, and living allowances.
  • With retro pay, you can make up for this difference in the employee’s next paycheck.
  • Willful violations of the Fair Labor Standards Act can also result in criminal prosecution, and multiple convictions can result in imprisonment.
  • Your benefits may also be adjusted in accordance with Social Security’s windfall offset provisions.