US Supreme Court to decide scope of arbitration exemption for transportation workers

Flowers Foods

29/09/2023 17:52

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      High court to decide if exemption applies outside
transportation
industry
    

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      Case involves delivery workers for a bakery
    

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      Scope of exemption has been litigated extensively
    

  
    By Daniel Wiessner
       Sept 29 (Reuters) - The U.S. Supreme Court on Friday
said it would decide whether an exemption from mandatory
arbitration of employment-related legal claims for
transportation workers is limited only to employees of companies
in the transportation industry. 
    The court granted a petition by Neal Bissonnette, a former
delivery driver for LePage Bakeries Park St. LLC, for review of
an appeals court ruling that said an exemption in the Federal
Arbitration Act (FAA) did not apply to him because he worked in
the bakery industry. 
    The question, which has divided appeals courts, could have
major consequences for companies such as retailers and
manufacturers that employ many truck drivers and other delivery
workers but do not make money from providing transportation
services.
    Workers who sign agreements to arbitrate legal claims
generally cannot file or join class action lawsuits, and
individual claims brought under wage laws are often too small to
be worth pursuing. More than half of private-sector U.S. workers
have signed arbitration agreements. 
    Lawyers for Bissonnette and LePage, a subsidiary of
Georgia-based Flowers Foods, did not immediately respond to
requests for comment. 
    The FAA requires arbitration agreements to be enforced
according to their terms, but includes an exception for
employment contracts "of seamen, railroad employees, and any
other class of workers engaged in foreign or interstate
commerce.” In a 2001 ruling, the Supreme Court said the
exemption applied only to transportation workers. 
    In the LePage case, Bissonnette claims the company
misclassified delivery drivers as independent contractors and
violated various wage laws. 
    The 2nd U.S. Circuit Court of Appeals last year said drivers
had to bring those claims in individual arbitration. The court
said that in order for workers to qualify for the FAA exemption,
they must be employed in the transportation industry. 
    The 11th Circuit has come to a similar conclusion. But the
1st and 7th Circuits in cases involving a retailer and a cement
company have held that the FAA exemption applies to any class of
workers engaged in interstate commerce. 
    The scope of the FAA exemption has been litigated
extensively in recent years, including its application to "gig
economy" companies like Uber Technologies Inc. Last year, the
Supreme Court in a case involving Southwest Airlines baggage
handler supervisors said the exemption applies to workers who
help move goods across state lines, even if they never do so
themselves. 
    Meanwhile, the high court has twice refused to review
rulings that said Amazon.com Inc drivers who make local
deliveries are involved in interstate commerce and exempt from
the FAA.
    The case is Bissonnette v. LePage Bakeries Park St. LLC,
U.S. Supreme Court, No. 23-51.
    For Bissonnette: Jennifer Bennett of Gupta Wessler
    For LePage: Traci Lovitt of Jones Day
    
    Read more:
    Amazon again loses bid for SCOTUS review on FAA exemption
    U.S. Supreme Court rules Southwest Airlines cannot force
wage suit into arbitration
    Uber drivers are not interstate workers exempt from
arbitration, US court rules

 (Reporting by Daniel Wiessner)