WASHINGTON (CN) — Truck drivers who haul Wonder Bread can be classified as transportation workers, the Supreme Court ruled Friday in a decision that expands arbitration exemption rights.
“A transportation worker need not work in the transportation industry to fall within the exemption from the [Federal Arbitration Act],” Chief Justice John Roberts, a Bush appointee, wrote for the unanimous court.
The 1925 Federal Arbitration Act forces courts to enforce arbitration clauses in employee contracts unless the worker is a seaman, railroad employee or any other class of workers engaged in foreign or interstate commerce.
The Supreme Court has attempted to define which employees get an arbitration exemption multiple times since the law took effect, finding most recently that an airport ramp agent whose job includes loading and unloading airplane cargo could be classified as exempt.
In Southwest Airlines Co. v. Saxon, the court ruled unanimously that since ramp agents were directly involved in transporting goods across state or international borders, they can be considered transportation workers under the exemption.
Two Wonder Bread truck drivers asked the justices to expand on Saxon. Neil Bissonnette and Tyler Wojnarowski work full-time hauling goods for Flowers Foods, the manufacturer of Wonder Bread.
Bissonnette and Wojnarowski were part of the final leg of the bread’s cross-country journey, tasked with driving the product from a Connecticut warehouse to stores throughout the state.
Flowers hired the truck drivers as independent contractors. This forced the drivers to form shell corporations and purchase the right to transport Flowers’ goods. The drivers also paid for the trucks they drove.
Despite that classification, Bissonnette and Wojnarowski said they were Flowers employees. In 2019, the drivers sued the company for misclassifying them in violation of state and federal wage laws.
Flowers tried to compel arbitration, but the drivers claimed they were exempt. A lower court sided with Flowers and the Second Circuit affirmed. The Supreme Court heard arguments in the case in February.
Roberts said the statute’s exemptions for seamen and railroad employees refer to the employment characteristic of being transportation workers. He said the exemption was never meant to be industry-specific and instead covers any transportation worker — even if they don't work in the transportation industry.
“In other words, any exempt worker ‘must at least play a direct and ‘necessary role in the free flow of goods’ across borders,’” Roberts wrote. The requirements limit the controlling federal law, the justice said, and "'undermine[] any attempt to give the provision a sweeping, open-ended construction.'"
Roberts said the Second Circuit incorrectly applied the high court's precedent in trying to decide if specific companies could be considered part of the transportation industry.
The high court said focusing on the industry instead of workers themselves would result in arcane riddles about the nature of a company’s services.
“Does a pizza delivery company derive its revenue mainly from pizza or delivery?” Roberts wrote. “Do companies like Amazon and Walmart — which both sell products of their own and transport products sold by third parties — derive their revenue mainly from retail or shipping?”
The case was remanded to the Second Circuit.
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