UPCOMING CHANGES TO ILLINOIS EMPLOYMENT LAWS IN 2023
With a new year right around the corner, employers and employees should be aware of two major amendments to laws affecting Illinois workplaces. Effective January 1, 2023, amendments to the One Day Rest in Seven Act and to the Family Bereavement Leave Act (formerly known as the Child Bereavement Leave Act) will provide additional protections for employees and obligations for employers. One Day Rest in Seven Act (ODRISA).
Presently, the law provides most employees with designated meal breaks and a consecutive 24-hour rest period within every calendar week, defined as beginning on Sunday at 12:01 a.m. and ending on the following Saturday at midnight. The amendment redefines the period in which an employee is entitled to 24 consecutive hours of rest, giving employees at least 24 consecutive hours of rest in every consecutive 7-day period. For example, under the current law, an employer can schedule an employee to work Monday of one week through Friday of the next week (twelve consecutive days) without having to provide the employee with a day off. Employees also receive additional meal breaks under the amended law. In addition to the mandatory 20-minute meal break within the first 5 hours of a 7½ hour continuous shift, employees will now receive an additional 20-minute meal period for every additional 4½ continuous hours worked.
ODRISA amendments also expand employer obligations. Under the 2023 amendments, employers will be required to post, in one or more conspicuous places, a notice provided by the Illinois Department of Labor summarizing the requirements of the Act and information about filing a complaint. Because of the shift to remote work following the COVID-19 pandemic, the amendment requires employers to provide the notice by email or post on a website regularly used by the employer to communicate work-related information that all employees are able to regularly access.
Employers will also face increased penalties for violations of the Act, including upping a violation from a “petty offense” to a “civil offense.” These new penalties target employers who fail to adhere to the rest and meal break requirements. Offenses include each week an employee has been denied 24 consecutive hours of rest and each day an employee has been denied a meal period. An employer may be liable for fines of $250 to $500 per offense. Notification requirement violations will result in a single offense with a civil penalty not exceeding $250.
Changes to this Act expand the availability for Illinois employees to take unpaid bereavement leave, which is a period of time taken by an employee due to the death of a family member. The FBLA is applicable to employers with 50 or more employees. Employees are only eligible for leave under FBLA if they are eligible employees under the Federal Family and Medical Leave Act (FMLA), which requires 12 months of employment and at least 1,250 hours over the past 12 months.
Under the former version of the Act, bereavement leave was only available for the death of a child. Now, the FBLA provides bereavement leave for the death of a “covered family member,” including children, stepchildren, spouses, domestic partners, siblings, parents, stepparents, mothers and fathers-in-law, grandchildren, and grandparents. Leave must be granted for a miscarriage; an unsuccessful round of intrauterine insemination or of an assisted reproductive technology procedure; a failed adoption match or an adoption that is not finalized because it is contested by another party; a failed surrogacy agreement; a diagnosis that negatively impacts pregnancy or fertility; or a stillbirth.
The FBLA requires employers to provide unpaid leave to employees to attend the funeral, make arrangements related to the death of the family member, and grieve. Leave must be taken within 60 days of the date the employee receives notice of the death of the covered family member or the date on which a qualifying event occurs. An employee is entitled to up to 6 weeks of bereavement leave during a 12-month period in the event of the death of more than one covered family member.
A complete discussion of employment laws and amendments is beyond the scope of this article. Please contact an attorney with questions or concerns regarding these changes or employment law-related matters.
MEDICAID PLANNING BASICS: WHAT YOU SHOULD KNOW
Many of us may eventually need long-term care (LTC), commonly known as nursing home care, due to a variety of circumstances. In order to plan for possible LTC needs, and to avoid potential Medicaid eligibility pitfalls, there are certain basic facts everyone should know.
Medicaid is a jointly funded state and Federal program that (among other services) provides benefits to pay for LTC for persons aged 65 and older with limited assets. Medicaid has strict income and asset eligibility limits and rules regarding what assets can be kept by the Medicaid applicant or their spouse. While a comprehensive discussion of Medicaid regulations is outside the scope of this article, knowing some basic facts about Medicaid asset limits and rules can assist a person with proper estate planning and paying for LTC if needed.
Income and asset limits vary from state to state. Illinois law requires that a person own no more than $2,000 of assets to be eligible for Medicaid benefits. The assets that count toward this limit include (but are not limited to) bank accounts, stocks, bonds, retirement assets, and certain annuities and life insurance policies. These are called “non-exempt assets.” If a person owns non-exempt assets totaling more than $2,000 in value, they must use, or “spend down” those assets before being eligible for Medicaid benefits. Married persons may also transfer non-exempt assets to their spouse who does not live in the nursing home (called the “community spouse”) in order to provide for the community spouse’s needs and to become eligible for Medicaid. The amount the community spouse may keep is called the Community Spouse Resource Allowance (CSRA). The CSRA limit in Illinois is $109,560 as of 2022.
A 2022 change to Illinois law provides for a long-overdue increase to the CSRA. Beginning January 1, 2023, the CSRA base amount will be $109,560 plus an additional amount of $2,784 added to the base amount each year from starting in 2024 through 2034, plus any annual increase allowed under federal law during the next 10 years. Starting January 1, 2034, the Illinois CSRA will be equal to the maximum CSRA amount allowed under federal law, which will permit the spouses of Illinois Medicaid recipients to keep more of their hard-earned assets. The amount of monthly income allowed to be kept by a community spouse in Illinois also increased as of June of this year.
Certain assets are NOT counted toward the asset limit of the Medicaid applicant or the community spouse, including a primary residence (if the spouse or a dependent still lives at home), one vehicle or certain prepaid funeral and burial plans. Please consult an attorney regarding which assets may be exempt as there are specific rules and value limits concerning exempt assets.
Some individuals consider transferring assets to family members in order to avoid spending down assets on long-term care costs. However, Medicaid has a 5-year look back rule. This rule allows Medicaid to look at gifts or transfers of assets made by an applicant within the 5 years prior to applying for Medicaid. If these gifts or transfers were for less than fair market value, Medicaid can deny benefits for a period of time based on the value of the transfer. For example, assume Mrs. A gives a car worth $10,000 to a grandchild. She later needs to apply for Medicaid to cover the $5,000/mo. cost of LTC. If Mrs. A’s gift to her grandchild was made less than five years before she applies for Medicaid, she could be denied benefits for 2 months, or the length of LTC the gift would have paid for.
A full discussion of Medicaid eligibility and asset planning strategies is beyond the scope of this article. Any person who has concerns about long-term care planning should consult an attorney to assist with complying with Medicaid rules and regulations You do not want to make a decision that could affect a loved one’s or your eligibility for Medicaid assistance when it is needed most.
NEW AMENDMENTS TO ILLINOIS LAWS AIM TO EASE THE PAIN OF ESTATE ADMINISTRATION
When a loved one passes away, family members are often overwhelmed with grief. Unfortunately, arranging funeral plans and administering the deceased’s estate creates added stress during difficult times. Recently, the Illinois legislature took action to ease some of the monetary obligations that arise when a family member passes away.
An amendment to the Illinois Consumer Fraud and Deceptive Practices Act took effect on January 1, 2022. This amendment ends early termination fees on utility contracts of deceased customers. The bipartisan amendment provides consumer protection to Illinois residents, even after death. The Free From Fees After Losing A Loved One Act (Public Act 102-0112) permits early termination of telephone, cellular telephone, television, Internet, energy, medical alert system, or water service contracts in the event the customer has passed away before the contract expires without imposing the fees customarily associated with early cancellation. This law is subject to federal laws and regulations.
Family members and trustees should also be aware that vehicle transfers from a trust to a non-spouse beneficiary are now taxed at a rate of $15 per transfer for each motor vehicle. This law took effect on May 13, 2022. The transfer tax applies to a non-spouse beneficiary that survives the grantor of the trust.
Prior to the amendment, the $15 transfer tax only applied to motor vehicle transfers or purchases between a spouse, parent, sibling, or child of the vehicle owner, or a non-spouse beneficiary who was gifted a vehicle in the administration of an estate. Transfers to a non-spouse beneficiaries in the administration of a trust could be taxed at much higher rates.
If you have questions regarding estate planning or administration of trusts and estates, please consider scheduling a meeting with an attorney for more information
ANIMAL BOARDING & INNKEEPER’S LIENS: WHAT PET OWNERS SHOULD KNOW
Over fifty percent of U.S. households own pets today. From dogs and cats to pigs and horses, pets are valued members of our households. As a result, animal boarding has become increasingly common for our beloved four-legged friends. Just as Illinois laws protect hotel owners from guests who fail to pay for their stay, laws protect animal boarding business owners stuck with an unpaid bill. These protections are found in the Illinois Innkeeper’s Lien Act, which provides for a lien on an item of property to secure payment of a debt. An innkeeper’s lien is a legal right of the innkeeper to hold personal property until payment for their services is tendered. The Act also extends to the boarding and care of domestic animals. Pet owners who utilize boarding services for their four-legged friends should be aware of these liens in the event they dispute charges to their bill or refuse payment.
Recently, an Illinois court upheld a lien on a horse for unpaid fees for boarding an animal. The stable owners filed a lien on the boarded horse pursuant to the Illinois Innkeeper’s Lien Act. The costs the stable owners sought to recover included stabling, training, and veterinary services. Legal fees incurred for the enforcement of the lien may also be included in charge calculations. However, innkeepers may not extend one lien to multiple animals owned by the same individual with unpaid charges at the animal boarding facility. The court held liens may only include unpaid charges relating to that animal.
Pet owners should also be aware that attempting to tender payment for outstanding charges releases the lien on their animal, destroying the legal right of the innkeeper to hold the animal from the owner. However, attempted payment does not dismiss the debt owed to the facility if the debt has not actually been paid.
When boarding pets, owners should be aware of the policies of the facility and be mindful of the possible repercussions associated with failure to pay charges arising from such services.
ARBRITATION CLAUSES ARE GENERALLY ENFORCEABLE IN ILLINOIS
Most people have signed a contract with a mandatory arbitration clause in the contract. However, many people may not realize what they are agreeing to when they sign a contract with an arbitration clause. In addition, how many times has an arbitration clause been explained to the person by the business or company that wrote the contract?
Arbitration is a dispute resolution process that is an alternative to going to court. An arbitration clause in a contract typically requires that any disputes be resolved by arbitration and waives the right for a party to file a lawsuit. Generally, arbitration is a confidential process where the parties decide on an arbitrator or panel of arbitrators, i.e., the person or persons who make the final decision on the dispute. Public policy in Illinois generally favors enforcement of arbitration clauses and decisions.
However, there are circumstances where a court will determine that an arbitration clause is not enforceable. A recent Illinois Appellate Court case found that a contractor’s arbitration clause in the company’s contract was unconscionable (i.e., excessively shocking or unreasonable) and therefore not enforceable. There are generally two situations in which an arbitration clause could be determined to be unenforceable, discussed below. A court’s finding that either or a combination of both types of situations could render an arbitration clause unenforceable.
The first situation is one in which some wrongdoing during the process of forming the contract deprived a party of a meaningful choice. Courts consider factors such as whether each party had the opportunity to understand the terms of the contract, differences in bargaining power between the parties, and whether certain contract terms were hidden. An example of this situation is when one party is not given a choice to read the contract before signing it.
The second type of situation is when the terms of a contract are so unfair or one-sided that they would oppress or unfairly surprise an innocent party. Examples of this type of situation are when an arbitration clause disallows attorney’s fees or punitive damages even though the law would allow attorney’s fees or punitive damages; a clause that has a confidentiality provision which prevents others from learning about similar misconduct of the company; or a requirement that the arbitration proceedings be held in a location that substantially increases the cost of arbitration compared to a different location.
Arbitration provisions are generally enforced in Illinois. Even if an arbitration clause contains some objectionable terms, a court may exercise its right to remove the unenforceable parts and hold the rest of the contract enforceable. Arbitration clauses can also be unenforceable due to fraud or duress.
Whether an arbitration provision is enforceable is heavily fact-based. An attorney can advise whether there are enforceability issues regarding an arbitration clause. Businesses should have their attorney review their arbitration clauses for any improper terms.
Ralph and Mary Elliott welcomed a new grandchild, David James Elliott on September 2, 2022. David is the son of Brian Elliott and Liz Elliott. Everyone is doing well and enjoying the newest addition to their family!
If you are a member of a civic, religious, or other community group and would like information on a certain legal topic, please contact us at 815-233-1022. We are happy to present complimentary seminars on a variety of legal topics.
Please visit our website for past editions of Law Notes and additional information about our firm at http://www.etwlawyers.com/.
Attorney Christina Willman was appointed as District 2 representative for the State Young Leaders Committee of the Illinois Farm Bureau. District 2 includes the following counties: Stephenson, Carroll, Jo Daviess, Ogle, Winnebago, and Boone. Christina will work with Young Leader members from all listed counties to help advocate for young farmers and young professionals in agriculture. Christina is excited to serve a two-year term on the State Young Leaders Committee of the Illinois Farm Bureau!