Special delivery: SCOTUS rules on FAA transportation worker exemption

On April 12, 2024, the U.S. Supreme Court (SCOTUS) provided guidance on the transportation worker exemption under Section 1 of the Federal Arbitration Act (FAA), unanimously holding that a worker doesn’t have to work in the transportation industry to qualify for the exemption. Employers with arbitration agreements should review both the employees’ duties and the agreements now to determine if they’re still enforceable.

Distributors sue bakery for right to litigate claims in court

Flowers Foods, Inc., is the nation’s second-largest producer and marketer of packaged bakery foods. Those baked goods, which include tortillas, bagels, snack cakes, and Wonder Bread and Sunbeam Bread products, are delivered to retail outlets nationwide using a network of distributors.

Neal Bissonnette and Tyler Wojnarowski owned the rights to distribute Flowers’ products to retail stores in parts of Connecticut—a job they later claimed required them to work at least 40 hours each week. Under the terms of their distributor agreement, any disputes were to be arbitrated under the FAA.

After Bissonnette and Wojnarowski filed suit in federal court against Flowers alleging violations of state and federal wage laws, the company moved to compel arbitration, arguing the governing contract over the parties required them to arbitrate their claims rather than litigate them in court.