What penalties will I face if I commit fraud? Employees bear full responsibility for funds received in error and are expected to repay overpaid funds to the University immediately.The University of North Carolina at Chapel Hill has implemented a formal procedure for the recovery of funds in employee overpayment situations. This chapter deals with state law provisions identifying, establishing, and collecting overpayments. All states have provisions addressing these matters. Best practice in my opinion is to void the overpaid paycheck and reissue corrected amount in your payroll system.