3M paying back nearly $1M in overpayments improperly deducted from employee paychecks

Thousands of 3M employees have been accidentally overpaid in recent years, often a few pennies or dollars, due to time card issues that didn’t get resolved before paychecks were issued.

The Maplewood-based company made it a habit to claw back the overpayments with deductions from a subsequent paycheck, but without voluntary written consent from employees. That’s illegal.

Now 3M will pay back more than $960,000 it deducted without that authorization in a settlement with the state Attorney General’s Office announced Thursday.

“It was wrong for 3M to deduct money from workers’ paychecks without their knowledge and agreement,” Minnesota Attorney General Keith Ellison said in a statement. “I am pleased that 3M was willing to cooperate with my office by returning money to workers and changing its deduction policies going forward.”

Checks ranging between $1 and $300 will be sent to about 1,700 current and former employees, with some payments higher than $300.

The overpayments resulted from “COVID-19 pandemic-related absences, 3M’s own incorrect calculations of employee salary base pay and 3M’s own incorrect calculation of overtime wages owed,” according to the settlement, which stemmed from 3M employee complaints and a state investigation that launched a year ago.

3M made a total of 5,978 unauthorized deductions from 4,204 employees between May 2020 and August 2023, according to settlement documents. More than half of the deductions were for less than $1 and are not included in the settlement.

3M recently adopted a policy to deal with overpayments and other deductions related to money owed to the company or for lost, stolen or damaged property.

“3M worked cooperatively with the Minnesota Attorney General’s Office to resolve concerns regarding previous processes for correcting overpayments,” the company said in a statement. “It is important to note that 3M did not take money away from employees for time they have worked but rather corrected an overpayment.”

The settlement calls for a $1 million civil penalty if 3M violates the deduction policy over the next three years.