Over the last two decades, the U.S. Supreme Court has made it clear that the Federal Arbitration Act (FAA) establishes a public policy favoring arbitration of disputes in lieu of litigation. There is one part of the FAA, however, that exempts certain workers “engaged in foreign or interstate commerce,” thus permitting these workers to sue in court. In recent years, the scope of the so-called “transportation worker exemption” has been heavily litigated in a variety of contexts, including its application to gig economy workers and others whose jobs may involve driving across state lines.
A unanimous decision issued this week by the High Court in the case of Southwest Airlines Co. v. Saxon resolves a split among federal appeals courts on the scope of the exemption. Rejecting the positions of each party to the litigation, the Court took more of a middle road on the specific issue before it. Regrettably, however, while the Court’s opinion provides a broad framework for analyzing future cases, it sheds little light on how the exemption may apply to many types of gig economy cases being litigated today, such as last mile delivery drivers.
Members of the Center for Workplace Compliance (CWC) can read more here.