The US Supreme Court delivered a unanimous decision, rejecting an industry-based test for determining exemption from mandatory arbitration under the Federal Arbitration Act’s transportation worker carveout. Here’s a breakdown of the key points:
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Clarification on Transportation Worker Exemption
In a significant ruling, the court clarified that workers falling under the interstate transportation jobs exemption can avoid mandatory arbitration, irrespective of whether their employer operates directly in the transportation industry. This decision resolves a circuit split and provides essential clarity on the application of the exemption.
No Industry Requirement Imposed
Chief Justice John Roberts, writing for the court, emphasized that Section 1 of the FAA does not impose an industry requirement for transportation workers to be exempt from arbitration coverage. The court overturned the Second Circuit’s decision, which compelled arbitration based on the argument that the drivers worked in the bakery industry.
Implications for Gig Economy
The ruling holds substantial implications, particularly for the gig economy. By disallowing companies from invoking arbitration agreements to bypass court proceedings in employment classification cases, the decision could potentially disrupt the business model of such companies.
Revival of Class Action Lawsuit
Friday’s decision revives a proposed class action lawsuit against Flowers Foods, alleging misclassification of drivers as independent contractors. The drivers, delivering products under distribution agreements with Flowers Foods subsidiaries, seek legal redress for wage and hour violations.
Legal Representation and Response
The workers are represented by Gupta Wessler LLP and Lichten & Liss-Riordan PC, while Flowers Foods is represented by Jones Day and Ogletree, Deakins, Nash, Smoak & Stewart PC. Representatives for the parties have not immediately responded to requests for comment.
Case Details
The case, styled as Bissonnette v. LePage Bakeries Park St. LLC, marks a significant development in the interpretation of arbitration exemptions for transportation workers engaged in interstate commerce.
