thread Re: Paid Employee through check and deposit by mistake in Staff & Payroll

Paid Employee through check and deposit by mistake

Bosshydrovac — Fri, 26 Sep 2025 20:24:48 GMT

I ran payroll on Monday and paid one of my employees by check the same day. However, I forgot to change his direct deposit to a paper check on square. He was paid by DD this morning. Is there anyway I can take the funds back through Square?

Re: Paid Employee through check and deposit by mistake

TheRealChipA — Fri, 26 Sep 2025 20:51:26 GMT

Hi @Bosshydrovac. Like all payroll providers that offer direct deposit, Square uses the national ACH system for these transfers. As such, once those deposits have been initiated, it is impossible to recall, cancel or claw them back. That is due to limitations in the federal system and not under Square's control.

Also, at this point, you only have a couple of courses of action. The easiest, of course, is to have the employee return the amount of the duplicate deposit. If they refuse, you'll need to check with your accountant but in most states you have the legal right to deduct that amount from their next paycheck. But, like I said, check on the proper procedure with an accountant, attorney or your state labor relations board. We can't give such advice here on how to proceed.

Re: Paid Employee through check and deposit by mistake

JTPets — Sun, 28 Sep 2025 14:08:54 GMT

Cancel the Cheque?

Re: Paid Employee through check and deposit by mistake

VanKalkerFarms — Tue, 30 Sep 2025 03:53:24 GMT

I would also think the check canceling or stop payment would be the best option if they haven't already deposited it. If they have I think your best option would be to talk with the employee and discuss the double payment especially since it has been a week.

Re: Paid Employee through check and deposit by mistake

VanKalkerFarms — Tue, 30 Sep 2025 14:43:15 GMT

Sorry, I am not able to edit my reply, but I would also talk with your accountant, as they would likely be up on how this needs to be legally handled, as you aren't the first person to ever do this. You can't stop an ACH Direct deposit.