Management Update
Volume 1, Issue 1
February 2012
Inaugural Issue of Breazeale, Sachse & Wilson's Management Update

Welcome to the inaugural issue of Management Update brought to you by Breazeale, Sachse & Wilson, L.L.P. We have created this newsletter in the style of Modern Management to continue to keep our clients and contacts up to date on the hot topics in Employment and Labor law.


We welcome your feedback in helping to make Management Update the most useful newsletter possible. If you want us to cover any issues, or take an in-depth look at a subject, please email us at  


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Lemle, Kelleher Attorneys Join Breazeale, Sachse & Wilson, L.L.P.

Breazeale, Sachse & Wilson, L.L.P. is excited to welcome eight new attorneys to the New Orleans office. Fred Preis, Eve Masinter, Joe Hugg and Rachael Jeanfreau are among the eight attorneys. They join the eight members of the Labor & Employment group at BSW. Full press release is here.

New Labor Group

Woman Fired for Working Through Lunch Wins Battle

Sharon Smiley had worked for ten years as a receptionist and administrative assistant at a Chicago real estate company until she was fired for skipping lunch one day.

In January 2010, Sharon Smiley decided to work through her lunch break to finish extra work she had received from a new manager. She decided to punch out for lunch, but she stayed at her desk to finish the extra work. Her human resource director informed her that company employees were required to take a 30 minute break, and not following that policy would be a violation of the labor laws in Illinois. Smiley was terminated.

After being refused unemployment, Smiley found out that she was ineligible for unemployment because she had been terminated for misconduct. Illinois allows an unemployed person to receive unemployment unless there has been misconduct, defined as "conduct evincing such willful or wanton disregard of an employer's interests."

After a two-year battle, an appeals court in Illinois has found that denial of her unemployment benefits was "clearly erroneous."

This situation highlights a dilemma employers often face. It may sound harsh, but employees who disregard their employer's instructions about working hours/breaks eventually must be disciplined and possibly discharged. Being charged for unemployment benefits is much better than being liable for violating State and Federal Wage & Hour laws.

"Chicago Tribune" reports full story here.

Pepsi Pays $3.13 Million and Changes Employment Policy

After a finding by the EEOC that Pepsi Beverages' former criminal background check policy discriminated against African Americans in violation of Title VII of the Civil Rights Act of 1964, Pepsi has agreed to pay $3.13 million and provide job offers and training in order to resolve charges. The EEOC's investigation of the former policy revealed that more than 300 African Americans were disproportionately excluded from permanent employment.  


During the EEOC's investigation, Pepsi adopted a new criminal background check policy. In addition to monetary relief, Pepsi will offer employment opportunities to victims of the former policy who are qualified and still want jobs at Pepsi. The company will supply the EEOC with regular reports on its hiring practices under the new policy. Pepsi will conduct Title VII training for its hiring personnel and all of its managers.


"We hope that employers with unnecessarily broad criminal background check policies take note of this agreement and reassess their policies to ensure compliance with Title VII," said Julie Schmid, Acting Director of EEOC's Minneapolis Area Office. This lawsuit shows that employers must be careful how they use information obtained when conducting background checks for applicants. Employers should not consider criminal background checks that describe arrest records - only those that indicate whether the applicant has been convicted of a crime - and even then, an employer who disqualifies a large number of applicants on the basis of criminal convictions should consider whether this policy has a disproportionate effect on individuals of any particular race, national origin, gender, or any other protected class. Also, employers always need to remember to comply with the requirements of the Fair Credit Reporting Act (FCRA) when ordering any kind of consumer report, including background checks.  


To read the EEOC Press release in full, click here. 

NLRB Finds Class Action Ban to be Unlawful

Employers who currently have mandatory arbitration policies or provisions in their employment agreements, may have to rewrite those policies. Recently, the NLRB held that an employer had committed an unfair labor practice by requiring employees to sign mandatory arbitration agreements, which waved the employee's rights to participate in a class claim.

The case involved a nationwide home building company, based in Florida, which required all new and current employees to sign a Mutual Arbitration Agreement (MAA) as a condition of employment. This agreement required all employment disputes to be resolved individually, and not as a group. When a superintendent at the company tried to join a class of other superintendents in a claim that they had been misclassified as exempt employees, the company refused to arbitrate the collective claim.

The NLRB found that the MAA had violated the NLRA and the company had committed an unfair labor practice. They found that "employers may not compel employees to waive their NLRA right to collectively pursue litigation." The US Supreme Court will likely look at this matter in a few years, but in the meantime, employers must be very careful about excluding any joint, class-based or collective claims in any mandatory arbitration policies.

If you have any questions regarding the NLRA's decision, including how it may impact your company's arbitration agreements, please contact your attorney, or email

The Mutual Arbitration Agreement can be downloaded here.  

NLRB Releases Second Social Networking Memo

The NLRB has issued a second report to try and provide guidance to human resource professionals regarding social networking. There are two main points emphasized in the memo.    

  1. Employer policies should not be so sweeping that they prohibit the kinds of activity protected by federal labor law, such as the discussion of wages or working conditions among employees.
  2. An employee's comments on social networking are generally not protected if they are mere gripes not made in relation to group activity among employees.

Employers should review their social networking policies and any other handbook policy that is broad enough to encompass social networking site usage.   


 The Operations Management Memo can be downloaded here.  

Breazeale, Sachse & Wilson, L.L.P. Labor and Employment Attorneys


 John T. Andrishok  



Murphy J. Foster, III  




Leo C. Hamilton  



Joseph R. Hugg  




Rachael Jeanfreau  




Eve B. Masinter 




Yvonne R. Olinde   




E. Fredrick Preis, Jr.  




Melissa M. Shirley 




Jennifer D. Sims 


square logo

Jerry L. Stovall  




This electronic newsletter is provided to clients and friends of Breazeale, Sachse & Wilson, L.L.P. The information described is general in nature, and may not apply to your specific situation. Legal advice should be sought before taking action based on the information discussed. Applicable State Bar or Attorney Regulations May Require This Be Labeled as "Advertising."Anchor1