Most Texas employers think of estate planning as something their employees do on a weekend with a cup of coffee and a lot of procrastination. It feels personal, private, and firmly outside the scope of any conversation that happens in your conference room. That instinct is wrong, and it is costing businesses money, time, and in some cases, litigation they never anticipated.

A recent continuing legal education presentation by Travis Weaver, a certified elder law attorney at the Weaver Firm, walked a room full of lawyers through the mechanics of wills, trusts, powers of attorney, Medicaid planning, and the legal chaos that follows when none of those things are done correctly. The attorney audience got their CLE credit. What they did not get was a translation of what all of this means for the HR professionals and business owners managing a workforce that is aging, caregiving, and in some cases quietly losing cognitive capacity at their desks. That translation follows.

Your Workforce Is the Sandwich Generation, and It Is Not a Compliment

According to a 2025 AARP and National Alliance for Caregiving report, 63 million Americans provide ongoing care for an adult family member or friend, and 7 in 10 of those caregivers are employed while doing it. The phrase “sandwich generation” refers to the growing share of your workforce that is simultaneously raising children and caring for aging parents. These employees are not a niche demographic. They are your mid-career managers, your institutional knowledge, and the people you cannot afford to lose.

The numbers are not abstract. A survey conducted in late 2024 and early 2025 found that nearly half of all employees take time off for caregiving, contributing to an estimated $8.8 billion in annual productivity losses. More than 80 percent of employees with caregiving responsibilities report that those duties affect their on-the-job performance. And per S&P Global, 13 percent of caregivers have switched employers specifically to accommodate caregiving demands.

What this means in employment law terms is not subtle. The Family and Medical Leave Act requires covered employers to provide up to 12 weeks of unpaid, job-protected leave for eligible employees who need to care for a parent with a serious health condition. More than 15 million workers were supported by the FMLA in 2025 alone. If your leave policy, your employee handbook, and your manager training have not been updated to reflect the caregiving reality of your workforce, you are not just behind on trends. You are exposed.

Only 30 percent of employers currently offer dedicated family caregiver leave, and most of those offer fewer than three weeks of pay. The employers who do not address this are not saving money. They are absorbing the cost in turnover, absenteeism, and FMLA disputes they did not see coming.

When Cognitive Decline Shows Up to Work

One of the more uncomfortable points from the elder law CLE was the attorney’s observation that the question of capacity, meaning whether someone truly understands what they are doing and why, is central to almost every elder law matter. It is also central to a legal risk that very few employers have prepared for: what to do when an employee develops dementia or another form of cognitive impairment while still employed.

The Americans with Disabilities Act may cover cognitive decline, including Alzheimer’s disease, dementia with Lewy bodies, and other neurological conditions, when the condition substantially limits one or more major life activities. Terminating an employee solely because of a dementia diagnosis, without first engaging in the interactive accommodation process, can expose an employer to disability discrimination liability. The ADA applies to employers with 15 or more employees.

The practical guidance is counterintuitive for many managers. An employer cannot ask an employee whether they have been diagnosed with a cognitive condition unless the inquiry is job-related and consistent with business necessity. An employer can, however, document specific, observable performance failures and address them through a straightforward performance process. If the employee then discloses a diagnosis, the interactive process begins. What employers cannot do is skip the performance documentation, guess at a medical cause, and then act on that guess. That is how you end up on the wrong end of an EEOC charge.

The aging of the American workforce makes this less of an edge case every year. With more workers delaying retirement, this will land in HR inboxes with increasing frequency. The employers with documented performance management processes and trained managers will be the ones in a better position to navigate it without writing a settlement check.

The Beneficiary Designation Time Bomb in Your Benefits Administration

Here is where the elder law world and the employment law world collide in ways that most HR professionals do not anticipate until it is too late. When an employee dies, the employer is not a neutral bystander. The employer is the plan sponsor of whatever group life insurance, 401(k), or other benefit plan is involved, and that comes with fiduciary obligations under the Employee Retirement Income Security Act (“ERISA”).

If your organization has not actively encouraged employees to keep beneficiary designations current, and an employee dies with an outdated designation or no designation at all, the resulting dispute can pull your organization into litigation. Employer plan sponsors and plan fiduciaries have been named in ERISA litigation where participants or beneficiaries alleged failures in plan communications, beneficiary records, or enrollment administration.

The elder law practitioner’s CLE presentation reinforced exactly why these designations matter so much. Under landmark U.S. Supreme Court decisions, ERISA can preempt state law when determining who receives plan benefits, and plan administrators generally must follow the plan documents and beneficiary designations on file. A divorce decree does not automatically override a beneficiary designation that was never updated. The plan documents control.

An employee who divorced 10 years ago and never changed the beneficiary designation on their group life policy may leave their former spouse as the legal recipient, regardless of the circumstances, and leave you to explain that outcome to a very unhappy family.

Annual benefits enrollment is not just a check-the-box exercise. It is a litigation prevention strategy. Employers who build beneficiary designation reviews into their annual enrollment process are doing their workforce a genuine service and reducing their own exposure at the same time.

Undue Influence Is Not  Just for Probate Court

The elder law presentation described undue influence in the estate planning context using a three-part test: the existence of influence over a vulnerable person, the exercise of that influence in a way that overrides the person’s own judgment, and a decision or change that would not have happened without it. The attorney described a client whose adult daughter was screaming through a conference room wall to pressure her mother into changing her beneficiary designations. The attorney removed the daughter from the building.

Employers and HR professionals encounter analogous dynamics, and they do not always recognize them for what they are. A supervisor who pressures a cognitively declining employee to sign a separation agreement. A coworker who convinces a financially distressed colleague to redirect their 401(k) beneficiary. A business partner who maneuvers an incapacitated owner out of a role or an ownership stake. These situations do not always rise to criminal elder abuse, but they create legal exposure, and they are far more common than most businesses are prepared to handle.

Texas has elder financial abuse protections under the Texas Human Resources Code. Employers who have documented, written policies addressing financial exploitation, and managers who are trained to recognize and escalate those situations, are in a meaningfully better position than those who discover the issue after the fact. Texas Adult Protective Services maintains reporting resources for suspected elder abuse and exploitation.

The Business Owner Who Has Not Planned Is a Risk to the Business

The elder law attorney’s observation about business succession applies directly to the small and mid-size employers who make up most of the Texas business landscape. If a key principal dies without a proper estate plan, or becomes incapacitated without a durable power of attorney in place, the business can find itself in a legal gray zone where no one has the authority to sign contracts, authorize payroll, or make operational decisions. The courts may need to get involved. The business may suffer.

A durable power of attorney that specifically addresses business operations, is properly drafted under Texas law, and grants authority to communicate with government agencies, is not just a personal planning tool. It is a business continuity document. Employers who own their businesses, or who have key principals without succession plans in place, are carrying an operational risk that has nothing to do with market conditions and everything to do with planning.

Business succession planning should begin at the formation of the business and be annually reviewed to ensure that it is current. Every small and mid-size business owner needs to be thinking of questions such as: 

• Does my business have an operating agreement (for LLCs) or bylaws (for Corporations)? 
• Does the operating agreement speak to what happens to an ownership interest when an owner dies? 
• Does the operating agreement conflict with an owner’s personal estate plan? 
• What measures are in place to preserve the value of the business after an owner passes away? 
• What is the long-term vision for the entity and how can we position the company best to work towards that vision? 
• If the long-term vision is to use the company as a legacy building vehicle, are there individuals who are prepared and willing to continue this legacy on? (Many family owned businesses are inherited by individuals who are not prepared and lack the desire to continue the family business. Estate planning is a time to be realistic to ensure the best plan is made) 

What Your Employee Handbook Should Reflect Right Now

Recent DOL guidance clarifies that employers cannot require employees to use employer-provided paid time off while receiving state or local paid family and medical leave benefits during FMLA leave. Colorado, where Treaty Oak Law Group maintains an office alongside its Texas headquarters and additional offices in Wyoming and North Carolina, expanded its paid family and medical leave program in 2026 to add up to 12 additional weeks for NICU care. Employers operating in multiple states cannot rely on a single federal policy and call it compliant, especially in an employment landscape where remote employment opportunities are expanding daily and far too many employers are location agnostic when searching for new hires. Your new employee may be able to perform their job duties from virtually anywhere but that does not automatically mean your business is prepared to satisfy local requirements virtually anywhere.  Do your research, complete the appropriate foreign business registrations, and make the other necessary local adjustments before you make a hire in a new jurisdiction.

An employee handbook that addresses leave for elder caregiving, beneficiary designation obligations, the interactive accommodation process, and financial exploitation policies is not a luxury. It is a compliance document that reflects the actual workforce employers now manage.

If your handbook still treats caregiving, incapacity, benefits administration, and workplace exploitation as separate issues, it may not be built for the problems already walking into HR.

Not sure your policies would hold up when those issues collide? That is where most of these cases turn.

If you want a second set of eyes before a handbook gap becomes an employment problem, let us take a closer look.

 

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Frequently Asked Questions

Does FMLA cover employees who need time off to care for an aging parent?

Yes. The Family and Medical Leave Act entitles eligible employees at covered employers to up to 12 weeks of unpaid, job-protected leave to care for a parent with a serious health condition. A “parent” under the FMLA includes biological, adoptive, step, and foster parents, but does not extend to in-laws. Employers with 50 or more employees within a 75-mile radius for at least 20 workweeks are covered. The leave may be taken continuously or intermittently. Employers are required to maintain the employee’s group health coverage during the leave period and restore the employee to the same or an equivalent position upon return.

What many employers get wrong is the intermittent leave piece. An employee who takes two hours off on a Tuesday afternoon to take a parent to a medical appointment is exercising FMLA rights, not abusing a flexible schedule. Employers who deny that leave or discipline employees for it without proper FMLA analysis are creating liability. Updated leave policies and manager training are the most practical mitigation available.

What are an employer’s ADA obligations when an employee shows signs of cognitive decline?

An employer’s first obligation is to avoid making assumptions about the medical cause of observable performance problems. The Americans with Disabilities Act prohibits medical inquiries that are likely to elicit disability-related information from employees unless the inquiry is job-related and consistent with business necessity. An employer who suspects cognitive decline should document the actual performance issues, address them through a standard performance management process, and allow the employee to disclose any relevant medical information voluntarily or in response to a neutral inquiry about their wellbeing.

If the employee discloses a diagnosis, the interactive accommodation process begins. The employer and employee are expected to engage in a good-faith dialogue about what accommodations might allow the employee to perform the essential functions of the job. Reasonable accommodations for cognitive impairment may include simplified routines, written instructions, reduced distractions, or modified scheduling. Termination is only appropriate if the employee cannot perform the essential functions of the role even with reasonable accommodations, and that determination must be based on individualized assessment, not assumptions about the condition’s trajectory.

Employers who skip the interactive process and proceed directly to termination upon learning of a dementia diagnosis face disability discrimination claims under the ADA and potentially under applicable state law. Documentation of the performance issues, the accommodation dialogue, and the business necessity for any adverse action is essential. Employers who feel over their heads facing these situations should reach out to counsel for assistance from the beginning rather than waiting until a claim has already been filed. 

Can an employer face liability related to beneficiary designation errors on employee benefit plans?

Yes, though the nature of that liability depends on the structure of the plan involved. For ERISA-governed benefit plans, including group life insurance and 401(k) plans, the plan documents and beneficiary designations control who receives a death benefit. The U.S. Supreme Court has confirmed that a plan administrator may rely on plan documents to determine the proper beneficiary, and that extraneous documents such as divorce decrees do not automatically override a beneficiary designation on file.

The employer’s exposure arises from its role as plan sponsor. If an employee dies and a dispute erupts over who should receive benefits, the employer may be named in litigation if alleged failures in participant communication or enrollment administration contributed to the problem. Employers who routinely prompt employees to review and update beneficiary designations during annual enrollment, who maintain clear records of those designations, and who have well-documented plan administration procedures are in a substantially better position to defend against those claims.

For non-ERISA plans, state law governs, and the rules vary significantly across jurisdictions. Employers operating in multiple states, including Texas, Colorado, Wyoming, and North Carolina, should ensure their plan administration practices reflect the requirements of each applicable state.

What should HR do if they suspect an employee is a victim of financial exploitation by a family member?

HR should first separate what it can observe from what it is inferring. A manager who notices that an elderly employee is under unusual pressure from a family member to change a beneficiary designation, or who is being accompanied to every workplace interaction by someone who answers questions on their behalf, is observing behavior. That observation does not give the employer the authority to investigate the employee’s personal finances or make medical determinations about their capacity.

What an employer can do is ensure the employee has private, unaccompanied access to HR. It can make the employee aware of available resources, including an Employee Assistance Program if one exists. If the employer has reason to believe the employee is being financially exploited and the situation rises to suspected elder abuse, Texas law provides a reporting mechanism through the Department of Family and Protective Services. An employer with a written policy on financial exploitation and a clear escalation process will be better positioned to respond appropriately without creating its own legal exposure in the process.

What happens to a business if the owner dies or becomes incapacitated without an estate plan?

From an employment law and operational standpoint, the consequences can be severe. If no durable power of attorney is in place, no individual has legal authority to act on behalf of the incapacitated owner. Contracts may go unsigned. Payroll authorizations may stall. Decisions that require a principal’s signature become unenforceable until a court appoints a guardian or receiver. That process is slow, expensive, and public.

If the owner dies without a will or trust that addresses what happens to the business, the ownership interest passes under state intestacy laws to heirs who may have no interest in, or qualifications for, operating the business. Texas is a community property state, which means the surviving spouse may have claims to business assets that the deceased owner never intended, particularly in blended family situations. In other words, there will be a lot of scrambling to determine who to give the business to and during the scrambling the business value suffers. Then, under the leadership of the unprepared new business owner, the business value is likely to suffer even further.

Employers, particularly business owners with key person dependencies, should treat estate planning documents as business continuity documents rather than personal planning tools. A properly drafted durable power of attorney under Texas law should specifically authorize the agent to conduct business transactions, communicate with government agencies, and manage financial accounts. The company operating agreement should speak to the transfer of business ownership and outline how the leadership transition process should work. This is not optional infrastructure. It is the difference between a business that continues operating and one that stalls while the courts sort out who has authority.