{"id":1382,"date":"2024-04-17T09:29:50","date_gmt":"2024-04-17T13:29:50","guid":{"rendered":"https:\/\/blogs.duanemorris.com\/classactiondefense\/?p=1382"},"modified":"2024-04-17T09:29:50","modified_gmt":"2024-04-17T13:29:50","slug":"u-s-supreme-court-holds-that-application-of-the-faas-transportation-worker-exemption-turns-upon-the-work-performed-and-not-the-employers-industry","status":"publish","type":"post","link":"https:\/\/blogs.duanemorris.com\/classactiondefense\/2024\/04\/17\/u-s-supreme-court-holds-that-application-of-the-faas-transportation-worker-exemption-turns-upon-the-work-performed-and-not-the-employers-industry\/","title":{"rendered":"U.S. Supreme Court Holds That Application Of The FAA\u2019s Transportation Worker Exemption Turns Upon The Work Performed And Not The Employer\u2019s Industry"},"content":{"rendered":"

\"\"<\/a>By Eden E. Anderson, Rebecca S. Bjork, and Gerald L. Maatman, Jr.<\/b><\/p>\n

Duane Morris Takeaways:<\/i> <\/b>\u00a0On April 12, 2024, the U.S. Supreme Court issued its decision<\/a> in Bissonnette v. LePage Bakeries Park St., LLC, Case No. 23-51 (U.S. Apr. 12, 2024), holding that application of the transportation worker exemption in the Federal Arbitration Act (\u201cFAA\u201d) turns upon the work performed by the plaintiff and not the employer\u2019s industry.\u00a0 The Supreme Court made clear, however, that this work-focused test should not bring within the exemption large swaths of workers who in some manner engage with products in the flow of commerce.\u00a0 The Supreme Court opined that the worker at issue must play a \u201cdirect\u201d and \u201cnecessary\u201d role in the free flow of goods across borders.\u00a0 Id. at 9. For employers with workplace arbitration agreements, the Supreme Court\u2019s ruling is a required read.<\/i><\/p>\n

Case Background <\/b><\/p>\n

The defendant in Bissonnette<\/i> produced and marketed baked goods, with its products made in 19 states and distributed across the country.\u00a0 The plaintiffs were franchisees who contracted with the defendant to distribute the products in local markets.\u00a0 The plaintiffs also advertised the products, identified retail buyers, and performed services for those retailers, including stocking and inventory.\u00a0 When the plaintiffs filed a putative wage and hour class action, the defendant sought to compel arbitration and to dismiss the class claims, citing a contractual arbitration provision with a class action waiver.<\/p>\n

The district court granted the motion and the Second Circuit affirmed.\u00a0 The Second Circuit reasoned that, because the plaintiffs\u2019 work was performed in the baking industry and not the transportation industry, the FAA\u2019s transportation worker exemption did not apply.\u00a0 The transportation worker exemption provides that the FAA \u201cshall not apply to contracts of employment of seamen, railroad employees, or any other class of worker engaged in interstate commerce.\u201d\u00a0 9 U.S.C. \u00a7 1.<\/p>\n

Immediately after that decision, the U.S. Supreme Court issued its decision in Southwest Airlines Co. v. Saxon<\/i>, 596 U.S. 450 (2022), wherein it held that the test to be employed in assessing application of the transportation worker exemption is based on the work performed by the plaintiff and not the employer\u2019s industry.\u00a0 Nonetheless, on panel re-hearing, the Second Circuit adhered to its prior decision on the grounds that the transportation worker exemption still did not apply because the defendant\u2019s business was to distribute baked goods into commerce and not transportation services.<\/p>\n

The U.S. Supreme Court then granted review.<\/p>\n

The Supreme Court\u2019s Decision <\/b><\/p>\n

As it did in Saxon<\/i>, the Supreme Court emphasized in Bissonnette <\/i>that the test for application of the transportation worker exemption focuses on the work performed by the plaintiff and not the employer\u2019s industry.\u00a0 Addressing the employer\u2019s argument that such a test would make virtually all workers who load or unload goods, such as pet shop employees and grocery store clerks, exempt transportation workers, the Supreme Court disagreed. It determined that the exemption has never been interpreted to apply in such a limitless basis.\u00a0 The Supreme Court emphasized that, for the exemption to apply, the worker \u201cmust at least play a direct and necessary role in the free flow of goods across borders.\u201d\u00a0 Bissonnette<\/i>, at 9.\u00a0 The Supreme Court thus vacated the order compelling arbitration and remanded for further proceedings.<\/p>\n

Implications Of The Decision <\/b><\/p>\n

Seemingly feeling its decision in Saxon<\/i> was being misapplied, the Supreme Court\u2019s ruling in Bissonnette<\/i> confirms that the FAA\u2019s transportation worker exemption turns upon the work the plaintiff performs and not on the employer\u2019s industry.\u00a0 Thus, an employer cannot seek to compel arbitration and avoid application of the transportation worker exemption by arguing that it is not in the transportation industry.\u00a0 Rather, an employer\u2019s arguments against application of the exemption must focus on the work the plaintiff performs.<\/p>\n

\n","protected":false},"excerpt":{"rendered":"

By Eden E. Anderson, Rebecca S. Bjork, and Gerald L. Maatman, Jr. Duane Morris Takeaways: \u00a0On April 12, 2024, the U.S. Supreme Court issued its decision in Bissonnette v. LePage Bakeries Park St., LLC, Case No. 23-51 (U.S. Apr. 12, 2024), holding that application of the transportation worker exemption in the Federal Arbitration Act (\u201cFAA\u201d) … <\/p>\n

Continue reading “U.S. Supreme Court Holds That Application Of The FAA\u2019s Transportation Worker Exemption Turns Upon The Work Performed And Not The Employer\u2019s Industry”<\/span><\/a><\/p>\n","protected":false},"author":583,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[41],"tags":[],"ppma_author":[30],"class_list":["post-1382","post","type-post","status-publish","format-standard","hentry","category-arbitration-issues"],"authors":[{"term_id":30,"user_id":583,"is_guest":0,"slug":"classactiondefense","display_name":"Class Action Defense","avatar_url":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-content\/uploads\/sites\/56\/2020\/10\/dmlogo.jpg","author_category":"","last_name":"Defense","first_name":"Class Action","job_title":"","user_url":"","description":""}],"_links":{"self":[{"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/posts\/1382","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/users\/583"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/comments?post=1382"}],"version-history":[{"count":0,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/posts\/1382\/revisions"}],"wp:attachment":[{"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/media?parent=1382"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/categories?post=1382"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/tags?post=1382"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/ppma_author?post=1382"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}