Why Should I Have a Will?

Many people have never had a Will or Trust drafted for them by an attorney. Maybe they don’t want to discuss personal details, they feel as if they aren’t ready to make such important decisions, or maybe they are unaware of the consequences of not having a Will. It’s common for 20-somethings to feel as though it’s just not important to have a Will right now. However, every age group can benefit from having a Will.

What people may not realize is that the State of Illinois has already written some estate planning documents for them. Those State-written documents provide for who will be the guardian of any minor children or disabled adult children you leave behind. They provide who in your family can make healthcare decisions for you if you are unable to make those decisions. They provide who will receive your hard-earned money and property after your death.

The good news is that you have the power to undo those documents, which are really state laws intended to fill in the gaps if you do not have a Will or a Trust or if those are somehow defective. You can have an attorney write a Will or Trust that will reflect your wishes as to the division of your property. You can also state who you want to care for your children after you are gone. More importantly, you can say who should not be allowed to care for your children after your death. Of course, a judge will make a determination as to the best interest of your children, but your wishes would be of great value and influence. An attorney could also prepare a power of attorney for healthcare where you get to decide who will make your healthcare decisions when you cannot, and you decide the standards by which that named person makes those decisions. You get to decide and describe in that power of attorney document whether or not you want to be kept alive by artificial means if your chances for recovery appear hopeless.

You have the right to specify, in another type of power of attorney, what type of mental health services you would want or not want if such became necessary. For instance, you might wish to specify that you not receive electro shock therapy.

You can also make a power of attorney for property and name an individual you know to be worthy of your trust to take care of and make decisions regarding your finances if your mental capacity greatly declines. Without such a document, a court of law may decide who should make financial decisions for you. Similar documents can help decide who can make personal decisions for you when you cannot.

The choice is, of course, left to the individual. However, please know that you have options. Explore them, so that you can make informed decisions that will have a great impact on you and yours later in life.

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Changes in U.S. Overtime Rules

The U.S. Department of Labor will be issuing new regulations in July 2016 that will bring an additional 13.5 million workers under the overtime requirements of the Fair Labor Standards Act. Labor Secretary Thomas Perez claims the new rules could add as much as $1.3 billion nationwide to workers’ pockets.

The proposed changes will more than double the salary threshold for overtime eligibility to $970 a week. This means that employees earning a yearly salary of $50,440 or less will automatically be eligible for overtime pay. Currently, the threshold for a salaried worker is $23,660 a year.

As of now, all hourly employees are automatically eligible for overtime pay. Salaried white collar workers, labeled by the U.S. Department of Labor as Executive, Administrative, and Professional Employees (EAP), are generally exempt from the requirement to pay overtime as long as they are paid at least $455 a week.

The DOL finds two major problems with the current rules. One, the salary level has not kept pace with the general increase in salaries since 2004. Additionally, employers have taken liberty with the definitions of EAP, and many workers who should not be exempt from overtime are classified as exempt. For example, under the DOL’s current rules, an administrative employee is one who exercises individual judgment or discretion in matters of significance to the company. However, administrative assistants, who do not exercise this judgment, if making more than $23,660 a year, are often classified as an exempt employee.

The DOL has decided on one solution: raise the minimum exempt salary for EAP workers. This means that when implemented, employers will have to begin paying overtime to all employees making less than $970 a week. The DOL believes salary is the only true objective measure of exempt vs. non-exempt staff, because job duties can vary so much from employer to employer. Thus, no matter what the employee’s job duties are, if the salary falls under the threshold, the employee is eligible for overtime.

Interestingly, the new overtime rules will not fix the minimum EAP exempt salary at a stated dollar amount. Rather, the minimum EAP exempt salary will be indexed at the 40th percentile of all salaries in America. The DOL will use the Bureau of Labor’s annual statistical data on salaries to reset the minimum FLSA exempt salary each year. This means that employees may be eligible for overtime one year and not the next (or vice versa) without any change in their salary.

Before the new rules take effect, employers should take advantage of the time to collect data related to each employee’s work week. By determining the work habits of employees, employers can consider the best classification for each. For example, if during the data collection period an employer sees that an employee is working an average of 47 hours a week at $42,500 a year, it may become more cost effective to raise the individual’s salary to $50,440. By increasing the salary rather than paying overtime, the employer may save money. With the DOL not issuing the rule until July 2016, employers have enough time to collect data on employee work habits and come up with a strategic, cost-effective plan to manage their employee’s salaries and overtime.

Eligibility For Unemployment Benefits

In a recent case regarding unemployment benefit eligibility, the plaintiff, Petrovic, was fired from defendant American Airlines after she gave a gift and a first class upgrade to a passenger without authorization.

Petrovic filed a claim for unemployment benefits with the Illinois Department of Employment Security. The Board of Review denied her claim on the ground that she was discharged for misconduct, so she filed a complaint for administrative review, where the trial court reversed the Board’s decision. The Board then appealed.

On appeal, the Board argued that Petrovic was employed as a tower planner for the airline. On the date in question, she left her work area without her manager’s approval to secure an undocumented upgrade for a “friend of a friend.” She had been issued a performance discussion less than a year earlier regarding being out of her work area.

The Board claimed that Petrovic received PC based training where she was made aware of the policies that only authorized employees may issue upgrades, and that employees are expected to remain in their work areas during their shifts unless given permission by their managers. Petrovic did not receive permission for any of her actions and admitted to receiving the PC based training.

Petrovic’s supervisor testified that along with the approximately $7,100 loss to the airline, the procedure for moving a passenger also affects the load audit necessary for an accurate weight and balance number, causing safety concerns.

The Illinois Unemployment Insurance Act denies benefits to employees discharged for misconduct. Under the Act, three elements must be proven to establish misconduct: “(1) there was a deliberate and willful violation of a rule or policy of the employing unit, (2) the rule or policy was reasonable, and (3) the violation either harmed the employer or was repeated by the employee despite a previous warning or other explicit instruction from the employing unit.” 820 ILCS 405/602(A).

There is plenty of Illinois case law stating that a rule or policy does not need to be written or otherwise formalized in order to be applied. The court may find the existence of a reasonable rule “by a commonsense realization that certain conduct intentionally and substantially disregards an employer’s interests.” Willful conduct stems from an employee’s awareness of, and conscious disregard for, a company rule.

Here, Petrovic admitted that she left her work area to procure an unauthorized upgrade. Though she claimed she was unaware of any rule or policy, the record indicated otherwise. Further, Petrovic admitted to being aware that she did not have authority to perform the actions she took.

The appellate court ultimately ruled that Petrovic’s actions resulted in financial loss to the employer, making her termination rightfully based on misconduct. They reversed the decision of the trial court that reversed the denial by the Board of Review, leaving Petrovic ineligible for unemployment benefits.