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Frequently Asked Questions

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Business FAQs

Can I require my employees to receive the COVID-19 vaccination or provide a negative COVID-19 test before they can return to work?

The short answer is yes, as long as you pay for it and the employees’ time getting it, and you do not discriminate.  The California Department of Fair Employment and Housing (DFEH) oversees this area of California employment law, and the DFEH recently clarified that employers may mandate vaccines approved by the U.S. Food and Drug Administration. Employers may request proof of vaccination but must take steps to protect employee privacy. There are wage and hour implications with a mandatory vaccination policy, so be sure to work with your employment counsel before implementing such a policy.

We have been cleared to return to work, but my employee is refusing to come back to the worksite. What can I do?

The first step is to learn why the employee is refusing to return to the worksite.  If the reason is related to a disability or for religious reasons, you will need to engage in a good faith interactive process with the employee to see if a reasonable accommodation is possible and would not be an undue burden on the business.  Remote work can be such an accommodation.

An employee who is just generally fearful of returning to the workplace does not have to be accommodated; however, this is an opportunity to communicate with your workforce and reassure them that you are committed to providing as safe a workplace as possible.  Show your workers that you have complied with all applicable guidelines and protocols, including a written COVID-19 Prevention and Response Plan, cleaning, masking and social distancing protocols, and the availability of paid leave for employees who may be ill or who are getting tested or being vaccinated. 

If the employee still refuses to return to work, employers can enforce their “reasonable disciplinary policies and practices” against employees who refuse to return to work and who aren’t entitled to accommodation.  This means that an employer can terminate the employment of an employee who refuses to return to work.  We recommend that you consult with legal counsel before taking any adverse employment action in this area, to analyze the legal risk, such as the employee arguing that s/he was terminated for engaging in protected activity.

We have an employee who tested positive for COVID-19. What can we tell her co-workers?

Under California Assembly Bill 685, employers who receive “notice of potential exposure” to COVID-19 of an employee who was physically at the worksite must, within one business day, notify all employees who were also present with the affected employee during the window of potential infection. The notice must be in writing and delivered in the way the employer typically communicates with workers, but it cannot include any personally identifiable employee information.  In addition to potentially exposed employees, the employer must also notify the employers of any subcontracted employees, and any union representative, and must comply with additional technical notice requirements or face costly civil penalties.  If three or more employees test positive, that is considered an “outbreak” and additional notice requirements must be met.

We are a small business. Do we have to provide paid sick leave to employees affected by COVID-19?

A number of complex leave laws may be triggered when you have an employee affected by COVID-19.  You will want to consult employment counsel for your specific situation, but some general examples of leave laws affecting California employers with less than 50 employees include:

  • If the employee was infected at work, s/he may be eligible for workers’ compensation.
  • If the employee or a family member is sick or needs preventive care such as recommended quarantine or stay-home order, employees may choose to take the leave they have accumulated under the Paid Sick Leave Law This law entitles employees to one hour of paid sick leave for every 30 hours worked or 24 hours (3 days) provided per year, subject to allowable caps on accrual.
  • If the employee is unable to work because of medical quarantine or illness related to COVID-19, they may be eligible for short-term disability insurance payments that provide partial wage replacement.
  • If the employee is unable to work because of caring for an ill or quarantined family member, eligible employees may be entitled to up to eight weeks of partial pay under California Paid Family Leave law.
  • If the employee lives or works in a locale with its own paid sick leave requirements, the employee may be entitled to additional paid sick leave pursuant to that local government paid sick leave law.

If you have more than 25 employees, they may be entitled to up to 80 hours of COVID-19 supplemental paid sick leave under a recent law enacted by Governor Gavin Newsom on March 18, 2021. 

What are some must-have employment policies for California employers?

It is not just our exceptional weather that sets California apart from much of the country.  Employment policies that work in other states or that comply with federal law may not work in the Golden State.  With our infamously aggressive plaintiffs’ bar and the proliferation of class action lawsuits and representative actions such as those brought by aggrieved workers under the Private Attorney General Act (“PAGA”), every California employer should have the following employment policies written and communicated to their entire workforce:

  • At-will employment policy
  • Anti-harassment, discrimination, and retaliation policy
  • Timekeeping policy and prohibition against “off-the-clock” work
  • Meal period and rest break policy
  • Lactation accommodation policy
  • Time off and leave policies

These policies can be included in a simple but complete employee handbook, which can be a one-stop shop for all of your employment policies. If you need assistance drafting an employee handbook or have any questions about the above list, contact us.

Can I hire independent contractors to work for me in California?

When it comes to hiring workers as independent contractors (aka “1099 workers”), California employers must proceed with caution.  Since Governor Newsom signed Assembly Bill 5 (“AB 5”) into law on September 4, 2020, the very concept of an independent contractor has fundamentally changed.  That law created an initial presumption that a worker in California is an employee unless the employer can satisfy a three-pronged test, the “ABC Test”, including the now-infamous prong B, by showing that the worker performs work that is outside the usual course of the hiring entity’s business.  The consequence of AB 5 is that, unless an exemption applies, the only workers who will be considered independent contractors are more akin to subcontractors who perform work that is not like work performed by employees in the business.

My employee wants to work through lunch and leave early. Can I agree to that?

Employees can voluntarily work through their lunch.  Be sure to get documentation from the employee showing that the employee chose to not have a compliant meal period.  There is no meal period violation if an employee voluntarily chooses to work during a meal period, as long as the employer:

  • Relieves the employee of all work duties;
  • Relinquishes control over their activities;
  • Permits employees a reasonable opportunity to take an uninterrupted 30-minute break;
  • Does not impede or discourage the employee from doing so; and
  • Completely and accurately records its compliance with California law, including documentation from the employee that it was the employee’s choice to forego or take a shorter meal period.

For more information, we encourage you to read more about compliance with California meal period law.

Our employment contracts contain an arbitration clause. Is that ok?

Arbitration in California has evolved over the past 20 years.  While the current mood among legislators and in the courts is to invalidate arbitration provisions that were forced on employees, employers can continue to require disputes to be resolved by arbitration.  However, should the agreement be challenged, it is very likely that the agreement itself and the circumstances of its signing will be scrutinized under a legal microscope. Courts are routinely refusing to enforce poorly drafted or outdated arbitration agreements, so now is the time to review your existing employment documents (contracts, handbooks, stand-alone agreements, policies and procedures) to make sure any arbitration agreements are drafted in a way to maximize their enforceability.

If you would like to review your employment documents with an experienced California employment law attorney, or have questions that weren’t answered here, we invite you to contact JDS Law, Inc. to schedule a consultation.

 

Estate & Trust Administration FAQs

What happens to my property when I die?

We can only give a general answer to this question, because no two estates are identical.  What happens to a given piece of property in your estate will be determined first, by how the property is titled, and second, by the total amount of property that is titled in your name as an individual (versus your name as trustee of your trust, or as a joint tenant, for instance).  Property that is part of your trust, that passes to a joint tenant, or that passes by beneficiary designation will not be part of your probate estate at all. As a result, that property will be transferred, in most cases, using forms instead of seeking court authorization.  If, however, you left property that was titled in your name alone, some form of court authorization will most likely need to be sought. 

Does a Last Will and Testament have to go through probate?

Yes. Assets that you leave to others using a Last Will and Testament must be distributed through the probate process. If there is no Last Will and Testament (or other estate planning document such as a revocable living trust), then the probate court will decide how to distribute the assets by following California Probate Code intestate succession laws.

What are the alternatives to probate?

There are many alternatives to going through probate.

If the only property in the estate is so encumbered by liens or debts that there will be nothing left once it’s sold, then it may be best to let the foreclosure process take care of it.

If the property has enough value to make it worth pursuing, then available probate alternatives will vary based on a number of factors, including the type of property (real estate or personal property) and its value, who else is on title, and who stands to inherit the property.

If the value of property in the probate estate is less than the statutory threshold ($166,250 in 2021), and at least 40 days have passed since the date of death, then personal property such as bank accounts and stocks can be transferred to the next of kin by using a notarized affidavit signed under penalty of perjury, with required supporting documentation attached.  This procedure cannot be used to transfer real property, but there may be other simplified procedures available through the probate petition process.

If an asset has a beneficiary named to receive it, that asset will not be part of a probate.  Assets that pass by beneficiary designation include life insurance, retirement accounts, pensions, or annuities, payable-on-death or transfer-on-death accounts or deeds, and property in a living trust.

If an asset was titled in the name of more than one person, the type of title ownership might remove the property from the probate estate.  For example, property with title held in joint tenancy or community property with right of survivorship, as well as joint account holders will receive the property without probate.

If survivors include a spouse, registered domestic partner, or minor children, there may be simplified procedures available to transfer the property.  Survivor benefits, such as Social Security or veterans’ benefits, do not require probate.

If you need help determining whether a given probate alternative is available may be difficult, contact experienced probate counsel for guidance. 

What does a trustee do?

A trustee is someone who holds and manages property for the benefit of someone else.  When the creators of a trust die, their successor trustee takes over the tasks of managing the trust assets and carrying out the instructions in the trust documents to ultimately transfer the trust property to the trust beneficiaries.  If the trustee and the executor are not the same person, the trustee will work with the executor on trust-related tasks. 

A trustee can do many of the initial tasks and day-to-day management without the help of professionals. Other tasks, such as filing tax returns, transferring ownership of real estate, funding sub-trusts, and making investment decisions may be best handled with the help of experienced professionals, such as attorneys, accountants, and financial advisors.   

Does a trustee get paid?

The first step is to read the trust documents and see if they mention trustee compensation.  As with most trust-related questions, the trust documents will determine what can be done.  However, in general, a trustee is entitled to reasonable compensation for the time spent executing trustee duties, and to reimbursement for trust-related costs and expenses.

My parent died and named me trustee. What do I do next?

The most important thing to know is that, unless there is an emergency trust task requiring immediate action, you have time to focus on grieving your parent before you have to worry about trust administration tasks.  As a practical matter in California, you will not be able to do much trust work until you have received the death certificates (order at least 10 certified copies), and it has been at least 40 days since your mom or dad passed. 

After ordering the death certificates, your first tasks will involve initial notifications and getting organized so you can gather as much information about what the trust owned and what it owed. The trustee will work with the executor to find the will and deposit it with the proper probate court.  The trustee will notify interested governmental agencies, including the Social Security Administration, Department of Health and Human Services, and others as required, and will get a taxpayer identification number for the trust. 

The trustee will next give notice to the trust beneficiaries, with the information required by the California Probate Code.  Other tasks include paying debts and may include property appraisals, reviewing investments, filing tax returns, and transferring property. If the trust property will be distributed quickly, then the trustee’s tasks will primarily involve gathering and protecting all trust property and completing the property transfers. 

If the trust will be ongoing, because there are minor children or continuing business operations for example, the trustee will have additional and ongoing tasks. The trustee must communicate with beneficiaries and provide them a trust accounting as required by the trust documents, at least once a year.

Is there common-law marriage in California?

No.  California does not, and has never, recognized common law marriage.  However, couples who have lived together for an extended period of time have rights, including rights they can assert to inherit property.

 

Estate Planning FAQs

What if I don’t have an estate plan when I die?

There is nothing like a devastating global pandemic to make us ponder our own mortality.  We all hope for the best, but it is important to be prepared for whatever comes.  If your wishes do not line up with the California Probate Code and you do not have a valid estate plan (will or trust) in place when the time comes, the state will have no choice but to give your property to your next of kin as defined by California law.

My family knows what I want. Do I need a formal estate plan?

Without a valid estate plan in place, those holding your property, such as your bank or mortgage company, may not have authority to recognize your wishes.  Then your survivors will have to seek court supervision to administer your personal affairs.  Even a “small estate” proceeding will take many months and, if you are facing a full-blown probate, it will be at least one to two years, and require several thousand dollars in fees and costs, before the person administering the estate will be able to distribute your property, even for the simplest estate.

What information do I have to share for an estate plan?

An effective estate plan requires information about your family and your assets.  While account numbers and exact balances do not need to be disclosed, the attorney advising you on estate planning matters needs an accurate sense of the size of your estate, the property owned, and the complexity of your family situation, because these things can dramatically impact the advice given.  JDS Law provides clients a confidential Estate Planning Questionnaire to help them gather and organize the necessary information, including the following:

  • Copies of current estate planning documents;
  • Names and addresses of your children, parents, and siblings;
  • Grant deeds to real property, including the legal description of the property;
  • Business agreements such as operating agreements, succession agreements, and buy sell agreements;
  • General account information for all financial accounts;
  • Stock certificates and bonds;
  • Information about insured assets; and
  • Marital contracts or divorce settlement documents impacting your estate plan.

JDS Law takes the security of your sensitive information and our ethical responsibility to maintain the confidentiality of our clients very seriously.  We offer clients an encrypted and password-protected portal that allows us to securely exchange information, including the Estate Planning Questionnaire, documents, messages, invoices and more.

What is a living trust?

A living trust is a powerful estate planning tool that allows its creators to hold their personal and real property, use that property for their own benefit during their lifetimes and then direct what happens to the property when they pass away.  If the terms of the trust can be changed while its creator(s) are living, it is a revocable trust, popularly known as a living trust. 

If the terms of the trust cannot be changed once it is signed, then it is an irrevocable trust, which is a different type of trust that can be useful for certain assets and situations.  Trusts are used to provide as easy a transition as possible for the creators’ loved ones, with the goal of avoiding probate and minimizing tax burdens.

Why would I want a trust?

If you own an interest in California real property or if your real and personal property totals more than the threshold dollar amount to trigger a California probate proceeding (in 2021, this amount is $166,250), then you should consider whether a trust would benefit you.  Property held in a trust will not be part of the creator’s estate for probate and tax purposes.

In addition, if you have minor children, it is worth thinking about how you would want them to manage their inheritance if you were not here to guide them.  For instance, would you want your child to receive their entire inheritance, outright and without any guidance or restrictions, when they turn 18?  That is what will happen under California law, unless you have left an estate plan with different instructions.

My only asset is my home. Do I need a trust?

If the home is located in California, you may benefit from a trust, even if the home is your only asset.  If you have more than one beneficiary who will inherit the home, or if minor children are involved, you will most likely want a trust.  If your only asset is the home and you have only one beneficiary you want to inherit the home, there are other alternatives to consider, including a Revocable Transfer on Death Deed.

My significant other will take care of our children. Shouldn’t I just leave everything to him/her?

With estate planning, you must consider the various scenarios that may happen after your death and the impact on your planning goals. What if your significant other marries? What if s/he has more children? What if you are concerned about minimizing tax burdens? Sometimes it makes sense to leave everything to your significant other outright and free of any restrictions, and other times a more nuanced approach is required.

Who should I name as the person to administer my affairs if I cannot?

You want to nominate someone you trust that would act in your best interest and in the best interest of those you care about.  Many times the choice is obvious, but sometimes it is not.  The right person to make medical decisions on your behalf may not be the same person you would want to handle your financial affairs.  The best person for your children to live with may not be the best person to manage their inheritance.  JDS Law is equipped to walk you through the process for selecting the people who will carry out the plans you make.

Do estate planning documents need to be notarized?

Some documents, such as powers of attorney and property deeds, must be notarized while others need to be witnessed or just signed and dated. JDS Law provides notary services, which are generally included as part of our estate planning packages.

How often should I update my trust?

You should update your estate plan whenever you have a major life change, such as a birth, death, marriage or divorce, or whenever there is a major change in the law affecting estate plans.  It is also a good idea to review your estate planning documents every three to five years to make sure they still meet your goals.  JDS Law will review your existing estate plan and give you customized recommendations for updates if needed.

How do I know if my home was actually transferred into my trust?

In order to transfer title to real estate in California, a formal deed and accompanying documents must be recorded with the county recorder’s office in the county in which the property is located.  You should have received a copy of the recorded deed.  If you did not, you can search county records by assessor’s parcel number or property address to confirm that a valid deed was properly recorded. If you have concerns that your home may not have been properly transferred to your trust, consult an experienced estate planning attorney for guidance.

What if my home wasn’t properly transferred into my trust?

You may easily transfer your home into your trust while you and anyone else on the title to the home is living.  If anyone on the title has passed away, the procedure for transferring the property into the trust will vary.  JDS Law has helped trustees successfully petition courts all over California to recognize property as a trust asset.  Contact us for a consultation.

I want to refinance my home and it’s in a trust. Can I?

Yes.  Real property that is titled in a revocable trust (sometimes called a living trust) should not be difficult to refinance.   The mortgage company may require you to transfer the property out of the trust before they will fund the loan.  Make sure that the property is properly transferred back into the trust after the refinance is complete. If you need assistance, JDS Law has the experience to help.

Should I do my own estate plan?

Although DIY estate planning software, websites, and pre-made kits are a dime a dozen, one size does not fit all when it comes to estate plans.  Every state, including California, has its own legal requirements and procedures that must be followed for an estate plan to have legal effect.  If you have minimal assets, do not have any real property, and want to leave everything to your closest living relative, then a DIY estate plan may work for you.  For any other estate, creating your own estate plan carries significant risk.  Whatever you decide, be sure to follow the exact procedural requirements for creating valid estate planning documents in California, including very specific witnessing requirements.  An estate plan is one of the few legal acts that survives death.  Because it will not be tested until you are gone, it is worth doing everything possible to ensure it is done right.

Why would I want to use an experienced estate planning lawyer to draft my estate plan?

A lawyer does more than make sure the estate planning documents are properly drafted.  An experienced lawyer helps you think about things you might not have considered, including best candidates for guardian, fiduciaries like trustees, executors, and agents under power of attorney, what happens in the event of remarriage, and what to do about pets and problematic in-laws.

Even simple estate plans need to be carefully thought out.  By way of example, imagine a woman with two sons who owns a piece of property worth $400,000 and a savings account with the same amount.  Wanting to divide her property equally between her boys, she hand writes her will, leaving the real property to one son and the savings account to the other.  She puts the will in her fireproof safe and doesn’t give it another thought.  On her death many years later, the real property has appreciated in value to $500,000 while she depleted the savings account, little by little, to $100,000.  One son will be very happy and the other son will be looking for a lawyer.

Words matter, especially when the author will not be available to explain, and an experienced estate planning attorney knows which words matter most.  In California, valid estate planning documents require “dispositive” language that clearly show the testator’s intent.  Words such as “I give” or “the Trustee shall distribute” are examples of such language.  Language that expresses general preferences, wishes or hopes will not be good enough.

If your estate plan is ever challenged, the court will be looking for someone to explain your intentions.  The court will not be able to rely on testimony from self-interested family members.  Testimony from the person who does not benefit from the estate and who had conversations with you while you were alive will be of most value.  That person will most likely be the estate lawyer who drafted the document.

 

Probate FAQs

How does probate work in California?

Probate is court-supervised administration of an estate.  It will require numerous court filings and at least two court hearings.  Probate is started by filing a Petition for Probate with the correct probate court so that a person can be appointed to administer the estate.  The petition packet consists of many forms that must be completed and filed with the court.  A hearing will be set for the court to hear the petition and notice must be given to known creditors and also published in a newspaper of general circulation. 

At the hearing, any objections will be given, and a personal representative (called an executor/executrix if there is a valid will; called an administrator if there is not) will be appointed by the court and takes on the duties and responsibilities of distributing the deceased person’s property to beneficiaries (if there is a will) or heirs (if there is no will).  Once appointed, the personal representative will manage all aspects of the probate estate, including inventorying assets, paying debts, responding to creditors’ claims, managing real estate or business concerns, and filing an accounting.

When all objections and creditors’ claims have been addressed, and the estate is ready to be transferred to the beneficiaries/heirs, the personal representative will file and give notice of a Petition for Final Distribution, and another hearing will be held.  If the personal representative hired an attorney to help with probate, the attorney’s compensation is set by the Probate Code and must be approved by the court, typically as part of the petition to close the estate. 

Once the Final Petition is granted, all distributions have been made and receipts filed with the court, the personal representative’s final task will be to file and give notice of a Petition for Discharge, which the court will review without a hearing.  Once this document is signed, the estate is officially closed, and the personal representative’s duties fulfilled.  The entire probate process, from first petition to last, will take approximately 18 months to 3 years for a simple estate and could be many years for a complex or contested estate.

Do I need a lawyer for probate?

Probate is a forms-driven, timeline-intensive process involving hundreds of steps that must be taken in a specific order and by strict deadlines.  While probate court judges are sympathetic to estate administrators, the court cannot overlook skipped steps or missed deadlines, and mistakes in probate cause costly and lengthy delays.  By hiring an experienced probate attorney, you will have a knowledgeable guide beside you.  Attorney’s fees in probate cases are set by statute and involve a sliding scale, based on the gross value of assets in the estate.

How long is the probate process?

It is a years-long process, and most of the estate property cannot be transferred until the end of that process.  Even a simple, uncontested probate should be expected to take at least 12 months.  A probate matter with many beneficiaries, creditors, litigation, or disputed assets can go on for many years.

How expensive is probate?

The total cost of probate will vary depending on the estate’s value, but a good rule of thumb is to plan on all probate-related costs and fees, including statutory attorney’s fees and personal representative compensation, to be between 7% and 10% of the value of the estate.  If the probate involves litigation, complex assets, or business operations, and the attorney has to render extraordinary legal services, the price tag can be much higher.

How can I plan to avoid probate?

You can avoid probate by gifting your property to your loved ones while you are alive.  This removes the property from your probate estate and transfers it to the people you want to have it.  Gifts may be subject to gift taxes and they will be counted toward your available exemption amount for estate tax purposes.

Another way to avoid probate is to title your property in such a way that it will not be part of your probate estate. You can own property as joint tenants with the right of survivorship, where the property will automatically pass to the surviving joint tenant.  Property that can be transferred at death to named beneficiaries is another option to avoid probate.  Examples include “payable on death” accounts and revocable payable on death deeds.  The examples above are most easily accomplished when you want the property to go to a small number of competent adults.

However, if you want to avoid probate but also have the property be shared among several people, or you want to condition receipt of property on an event such as reaching a certain age, or achieving a certain level of schooling, you will want to seriously consider a revocable living trust.  When the trust creators die, the trustee can easily and quickly transfer the trust property to the people who are supposed to receive it, or hold that property in trust for their benefit and in the way specified in the trust.

Lastly, California provides special procedures for “small estates”, or estates whose value falls below specific thresholds, that are shortcuts through probate, including the use of affidavits to transfer property, and special petitions that can be used instead of a full-blown probate petition.

If you would like to discuss your estate planning or probate or trust administration questions with an experienced California estate planning attorney, or have questions that weren’t answered here, we invite you to contact JDS Law, Inc. to schedule a consultation.

 

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