Source: https://justice.org/news-and-research/law-reporter-and-trial-news/january-31-2019-trial-news
Timestamp: 2019-04-24 03:51:19+00:00

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In a unanimous 8-0 decision, the U.S. Supreme Court has ruled that an interstate trucking company may not compel arbitration of a truck driver’s claims because they constitute a dispute involving a transportation worker’s “contract of employment” and thus are exempted under §1 of the Federal Arbitration Act. Attorneys described this decision, which affects a large segment of transportation workers, as an important victory for workers seeking to protect their rights in the courts.
In a unanimous 8-0 decision, the U.S. Supreme Court has ruled that an interstate trucking company may not compel arbitration of a truck driver’s claims because they constitute a dispute involving a transportation worker’s “contract of employment” and thus are exempted under §1 of the Federal Arbitration Act (FAA). The Court rejected the defendant’s argument that the FAA exemption does not cover the driver because he was an independent contractor, finding ample evidence that when the FAA was enacted in 1925, the term contract of employment was understood to refer to agreements with workers, not only employees. (New Prime Inc. v. Oliveira, 2019 WL 189342 (U.S. Jan. 15, 2019).) Attorneys described this decision, which affects a large segment of transportation workers, as an important victory for workers seeking to protect their rights in the courts.
As Trial News previously reported, Dominic Oliveira, an independent contractor for New Prime, sued the interstate trucking company in federal court in Massachusetts for failing to pay truck drivers minimum wage. Oliveira brought a class claim for breach of contract or unjust enrichment and alleging that New Prime violated the Fair Labor Standards Act and the Missouri minimum wage statute. New Prime moved to compel arbitration under the FAA, which Oliveira argued did not apply to his work contracts. The district court denied New Prime’s motion in 2015, and the First Circuit affirmed in 2017.
The Supreme Court certified two questions for review when it granted certiorari: whether courts or arbitrators should determine the FAA’s applicability and what transportation worker agreements are covered by the §1 exemption. In October, oral arguments focused primarily on the second issue and whether independent contractors fall under the FAA exemption.
Justice Neil Gorsuch, writing for the unanimous Court, noted that before ordering arbitration in this context, courts must first determine whether the §1 exemption applies: “The parties’ private agreement may be crystal clear and require arbitration of every question under the sun, but that does not necessarily mean the [FAA] authorizes a court to stay litigation and send the parties to an arbitral forum.” The Court rejected New Prime’s argument that arbitrators should make this determination because the employment agreement in question delegated questions of arbitrability to them. Delegation clauses are enforceable under FAA §§3 and 4, but under the statute’s “terms and sequencing,” that inquiry must take place after an analysis of §1, an “antecedent statutory inquiry” appropriate for the courts.
Justice Ruth Bader Ginsburg concurred, agreeing with the decision but noting that to meet a statute’s “remedial purpose,” statutory language may need to be interpreted flexibly to reflect “changing times and circumstances.” Justice Brett Kavanaugh did not take part in the decision.

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