Court Opinion

ID: 4300334
Source: CourtListenerOpinion
Date Created: 2018-08-02 13:19:15.422085+00
Date Added: 2024-06-11T14:42:02.641996
License: Public Domain

COURT OF APPEALS
                                EIGHTH DISTRICT OF TEXAS
                                     EL PASO, TEXAS

                                                 §
  OEP HOLDINGS, LLC,                                            No. 08-17-00159-CV
                                                 §
                         Appellant,                                  Appeal from
                                                 §
  v.                                                              41st District Court
                                                 §
  MOHAMMAD AKHONDI,                                           of El Paso County, Texas
                                                 §
                         Appellee.                             (TC # 2016-DCV0460)
                                                 §

                                         OPINION

       In this appeal, we decide if an “orientation instructor” for a trucking company is a

“transportation worker” under the Federal Arbitration Act. Based on the trial court’s finding that

an orientation instructor is a transportation worker, the trial court denied OEP Holdings, LLC’s

(OEP) motion to compel arbitration. We affirm the trial court’s decision.

                                       BACKGROUND

       This is an employment discrimination case. Mohammed Akhondi worked for OEP, a staff

leasing company. OEP provided workers, including Akhondi, to Mesilla Valley Transportation

(MVT), a national over-the-road trucking company. Akhondi signed an arbitration agreement with

OEP requiring that employment discrimination claims be resolved through arbitration. When OEP

terminated his employment, Akhondi filed suit asserting age discrimination, along with a

retaliation claim. OEP moved to compel arbitration under the Federal Arbitration Act (FAA).
Akhondi does not dispute that he signed the agreement, or that the text of the agreement would

cover a dispute such as this, nor does he raise any of the traditional affirmative defense to

arbitration. Rather the narrow question below, and before us, is whether he is a transportation

worker under the FAA.

        The FAA requires the enforcement of arbitration agreement, but excepts “contracts of

employment of seamen, railroad employees, or any other class of workers engaged in foreign or

interstate commerce.” [Emphasis added]. 9 U.S.C. § 1. No one would seriously dispute that truck

drivers generally fall within that class, and thus the scope of the exception. See e.g. In re Swift

Transp. Co., Inc., 311 S.W.3d 484, 488-89 (Tex.App.--El Paso 2009, orig. proceeding) (noting

truck driver fell within exception). Trucking companies, however, employ other classes of

workers to accomplish their mission, including mechanics, dispatchers, loaders, trainers, and as

relevant here, orientation instructors. Does an orientation instructor, as described in this record,

fall within the class of transportation workers exempted by the FAA? That trial court said yes,

and it declined to enforce the arbitration agreement. OEP brings this interlocutory appeal1 and in

a single issue, claims that the trial court abused its discretion in doing so.

                                      STANDARD OF REVIEW

        We review a trial court’s decision to grant or deny a motion to compel arbitration for an

abuse of discretion. Ellman v. JC General Contractors, 419 S.W.3d 516, 520 (Tex.App.--El Paso

2013, no pet.). Under this standard, we defer to a trial court’s factual determinations if they are

supported by some evidence, but we review a trial court’s legal determinations de novo. In re

Labatt Food Serv., L.P., 279 S.W.3d 640, 643 (Tex. 2009); Ellman, 419 S.W.3d at 520; Sidley

Austin Brown & Wood, LLP v. J.A. Green Development Corp., 327 S.W.3d 859, 862-63

1
  See TEX.CIV.PRAC.&REM.CODE ANN. § 171.098(a)(1)(West 2011)(allowing interlocutory appeal of denial of motion
to compel arbitration).

                                                      2
(Tex.App.--Dallas 2010, no pet.)(applying a no-evidence standard to the trial court’s factual

determinations and a de novo standard to legal determinations under the Texas Arbitration Act).

Because the trial court here did not enter specific findings of fact or conclusions of law to explain

its denial of the motion to compel arbitration, we infer that the trial court made all the necessary

findings to support its ruling. Kmart Stores of Texas, L.L.C. v. Ramirez, 510 S.W.3d 559, 565

(Tex.App.--El Paso 2016, pet. denied)(analogizing disputed motion to compel arbitration to a non-

jury trial proceeding).

                              ARBITRATION UNDER THE FAA

       Generally, the FAA provides for the enforceability of “any maritime transaction or a

contract evidencing a transaction involving commerce.” 9 U.S.C. § 2 (2009). Congress exempted

from the FAA’s coverage, however, “contracts of employment of seamen, railroad employees, or

any other class of workers engaged in foreign or interstate commerce.” 9 U.S.C. § 1 (2009). This

exclusion provision “is limited to transportation workers, defined, [. . .], as those workers ‘actually

engaged in the movement of goods in interstate commerce.’” Circuit City Stores, Inc. v. Adams,

532 U.S. 105, 112, 121 S. Ct. 1302, 1307, 149 L. Ed. 2d 234 (2001), quoting Cole v. Burns Int’l

Security Servs., 105 F.3d 1465, 1471 (D.C.Cir. 1997). The exclusion expresses a “concern with

transportation workers and their necessary role in the free flow of goods. . . .” Circuit City, 532
U.S. at 121, 121 S.Ct. at 1312. It also evidences a Congressional intent to reserve regulation of

those employees for separate legislation more specific to the transportation industry. Id. at 120-

21, 121 S. Ct. at 1312; Hill v. Rent-A-Ctr., Inc., 398 F.3d 1286, 1289 (11th Cir. 2005). Congress’s

emphasis, however, “was on a class of workers in the transportation industry, rather than on

workers who incidentally transported goods interstate as part of their job in an industry that would

otherwise be unregulated.” Hill, 398 F.3d at 1289.

                                                  3
        Differentiating transportation workers from those who only incidentally aide in the

transport of goods is a fact intensive inquiry. This Court concluded that a mechanic employed by

a trucking company was a transportation worker, and thus exempt from the FAA. Western Dairy

Transport, LLC v. Vasquez, 457 S.W.3d 458, 463 (Tex.App.--El Paso 2014, no pet.). The United

States Court of Appeals for the Third Circuit found that a “field services supervisor” who oversaw

between 30 and 35 drivers was also a transportation worker. Palcko v. Airborne Express, Inc., 372
F.3d 588, 590 (3rd Cir. 2004); see also Zamora v. Swift Transportation Corp., 2008 WL 2369769,

at *9 (W.D.Tex. 2008), aff’d, 319 Fed. Appx. 333 (5th Cir. 2009)(unpublished)(terminal manager

who was directly responsible for the overall success and profitable operation of defendant’s

terminal was a transportation worker). Other courts have reached the opposite conclusion for other

classes of employees. See McNamara v. Yellow Transportation, Inc., 570 F.3d 950 (8th Cir. 2009)

(customer relations manager was not a transportation worker under FAA); Bell v. Ryan

Transportation Serv., Inc., 176 F. Supp. 3d 1251, 1255-56 (D. Kan. 2016)(freight broker employed

by a logistics company that itself operated no trucks was not a transportation worker); Lorntzen v.

Swift Transp., Inc., 316 F. Supp. 2d 1093, 1097 (D.Kan. 2004)(“Safety Compliance Assistant” at a

transportation company was not a transportation worker). And courts have more uniformly found

that workers employed by companies that only assist those who transport persons or goods do not

fall within the exemption.2

2
  See e.g. Pilot Travel Centers, LLC v. McCray, 416 S.W.3d 168, 187 (Tex.App.--Dallas 2013, no pet.)(truck stop
maintenance worker was no more engaged in interstate movement of goods than clerk at truck stop or wait staff at
truck stop restaurant); Omoruyi v. Grocers Supply Co., Inc., No. 14-09-00151-CV, 2010 WL 1992585, at *4
(Tex.App.--Houston [14th Dist.] May 20, 2010, no pet.)(not designated for publication)(holding that a warehouse
employee was not a transportation worker); Tran v. Texan Lincoln Mercury, Inc., No. H-07-1815, 2007 WL 2471616,
at *4 (S.D.Tex. Aug. 29, 2007)(holding that a car dealership’s finance manager was not transportation worker); Perez
v. Globe Airport Sec. Serv., Inc., 253 F.3d 1280, 1284 (11th Cir. 2001)(pre-departure security agent at international
airport who inspected goods was not a transportation worker); Cole v. Burns Int’l Sec. Serv., 105 F.3d 1465, 1472
(D.C.Cir. 1997)(security guard at a train station was not a “transportation worker” because he was not actually
involved in the “ ‘flow’ ” of commerce, meaning he was not responsible for the transportation and distribution of the
goods).

                                                         4
       In Lenz v. Yellow Transp., Inc., the Eighth Circuit set out a nonexclusive eight-part test for

determining whether an employee is a transportation worker for purposes of the 9 U.S.C. § 1

exclusion. 431 F.3d 348, 352 (8th Cir. 2005). This Court recently applied the Lenz test. Vasquez,
457 S.W.3d at 465-67; see also Zamora, 2008 WL 2369769, at *6. Lenz’s eight nonexclusive

factors include: (1) whether the employee works in the transportation industry; (2) whether the

employee is directly responsible for transporting goods in interstate commerce; (3) whether the

employee handles goods that travel interstate; (4) whether the employee supervises employees

who are themselves transportation workers, such as truck drivers; (5) whether like seamen or

railroad employees, the employee is within a class of employees for which special arbitration

already existed when Congress enacted the FAA; (6) whether the vehicle itself is vital to the

commercial enterprise of the employer; (7) whether a strike by the employee would disrupt

interstate commerce; and (8) the nexus that exists between the employee’s job duties and the

vehicle the employee uses in carrying out his duties. Lenz, 431 F.3d at 352. OEP concedes that

these factors should guide our decision in this case.

                                  AKHONDI’S JOB DUTIES

       Akhondi started with MVT in 2011 as a dispatcher. At the time of his termination, he held

the job title of “orientation instructor.” The parties evidenced his job duties through the live

testimony of Luis Garcia (MVP’s director of recruiting), the affidavit and live testimony of

Akhondi, and the written job description for the position.

       The “orientation instructor” job description summarizes the position as developing and

conducting an orientation program for new drivers and re-hires. Akhondi would develop and

conduct that program by: (1) determining the training needs within MVT; (2) providing guidance

to operations employees, new drivers, and re-hired drivers; (3) presenting MVT’s policies and

                                                 5
procedures; (4) selecting, developing and updating teaching aids; (5) instructing drivers on federal

Department of Transportation rules and regulations; (6) updating the driver handbook as needed,

and communicating those changes; (7) conducting orientation sessions for new employees,

including on-the-job training, and use of specified software packages; (8) coordinating driver truck

assignments; (9) testing trainees to measure progress and to evaluate effectiveness of training; (10)

maintaining records of all testing for drivers and re-hires; and (11) reporting to the Operations

Manager any job refusals or negative conduct among orientation attendees. While the job did not

require the orientation instructor to have a commercial driver’s license, Akhondi did at that time.

       Akhondi’s affidavit explained his orientation duties as follows:

       As an Orientation Training Instructor for MVT, I trained drivers that transported
       goods throughout the country. As a trainer, I handled the trucks which were used
       to transport goods. On some occasions, I drove these trcuks [sic] from El Paso, TX
       to Arizona and New Mexico for training purposes. On one occasion, I trained a
       driver where goods were actually transported from El Paso, TX. As a trainer, I
       would supervise truck drivers that transported goods throughout the country. The
       trucks and trailers that I used for training were critical to MVT’s operations as a
       trucking company. I trained drivers using the same trucks that the truck drivers
       used to transport goods.
       Akhondi testified at the hearing on the motion to compel arbitration. He explained that he

took each new driver out to their assigned rig and taught them (1) how to use the unique software

packages that MVT uses in its trucks, (2) how to use the standard stick shifts in MVT vehicles,

and (3) how to perform a pre-trip inspection of the rig. On three or four occasions during the two

and half year period that he was the orientation instructor, he went with the drivers to the ports of

entry to show them how DOT inspections are done at state borders. On one occasion, and at the

direction of his supervisor, he accompanied a driver from El Paso to Albuquerque to train the

driver on the software and how to back the truck to a dock. MVT has a “miles per gallon” program

to promote fuel economy; Akhondi testified that he would also teach drivers ways to improve their

driving to save fuel. He admitted that his use of the word “supervise” in his affidavit was an error.

                                                 6
He was, however, also a member of a three-person incident review committee that would review

driver accidents, and make recommendations stemming from those accidents, including whether

the driver should be terminated or otherwise disciplined.

        At the hearing below, OEP relied on the testimony of Luis Garcia, who was the director of

recruiting for MVP. He testified that Akhondi would not have any duties requiring him to be on

the road with truckers, nor the actual transportation of goods. Garcia acknowledged, however, that

his testimony was based on assumptions about what the orientation instructor would do, and was

not based on any personal knowledge of Akhondi’s actual job.

                                        APPLICATION

        While the parties dispute how some of the Lenz factors apply, all agree that MVT is in the

transportation industry (the first Lenz factor). The concession is significant, because “the more

related to the transportation industry an enterprise is, the less necessary it becomes for the

employee to be directly transporting goods” in order for Section 1’s exclusion to apply. Zamora,

2008 WL 2369769, at *6, quoting Veliz v. Cintas Corp., No. C-03-1180-SBA, 2004 WL 2452851,

at *5 (N.D.Cal. Apr. 5, 2004). Not that employment within the transportation industry alone is

sufficient:   the employee’s individual responsibilities “must be closely related to interstate

commerce,” although they “need not actually transport the goods himself for the exemption to

apply.” Zamora, 2008 WL 2369769, at *6, citing Lenz, 431 F.3d at 351–52. The first factor thus

weighs heavily in Akhondi’s favor.

        The second factor (direct responsibility for the movement of goods in interstate commerce)

and the third factor (handles interstate goods) weighs against Akhondi. Unlike truck drivers who

transport goods interstate, Akhondi is not personally responsible for the transport or handling of

                                                7
goods. The fact that he did so on one occasion would not be sufficient to turn this factor in his

favor.

         The fourth factor (supervision of employees who are themselves transportation workers)

also weighs somewhat against Akhondi. He is not a supervisor in the strict sense of the word, in

that he does not hire, fire, or direct the daily tasks of MVT’s truck drivers. He does, however,

instruct them on company policies, coordinate driver assignments, and is required to report

negative information on new drivers to the operations manager. As a part of an accident review

committee, he had input into disciplinary recommendations which management most of the time

followed. OEP argues, and Akhondi does not contest, that the fifth factor--whether Akhondi is

subject to special arbitration provisions like seamen and railroaders--is effectively neutral to our

analysis.

         Two of the last three Lenz factors weigh in favor of Akhondi being a transportation worker.

The sixth factor asks whether the vehicle itself is vital to the commercial enterprise of the

employer. Id. There is some evidence in the record that MVT is a trucking company and that

trucks are essential to its operation. See Zamora, 2008 WL 2369769, at *7-8 (“Clearly, a truck, as

a vehicle, is critical to the operations and the economic viability of a trucking company such as

Swift.”). And while Akhondi does not repair or maintain a truck as did the truck mechanic in

Vasquez, he instructs drivers on the use of unique software that MVT uses as a part of its business

model. For much the same reason, there is some evidence in the record supporting the eighth

factor--a nexus between the orientation instructor and the operation of the trucks.3 Akhondi

3
  OEP in its reply brief asks that this factor be strictly applied as the Lenz court originally parsed it: “eighth, the nexus
that exists between the employee’s job duties and the vehicle the employee uses in carrying out his duties (i.e., a
truck driver whose only job is to deliver goods cannot perform his job without a truck).” Lenz, 431 F.3d at 352.
According to OEP, because Akhondi did not have a truck, he must lose on this factor. However, the Lenz factors are
just that--factors--that were non-exclusive and gleaned from several earlier published opinions. We do not feel
constrained to strictly apply them as we would statutory language.

                                                             8
instructs on the software used in the truck’s operation, as well as routine safety checks, and DOT

inspections necessary to comply with state and federal law. And while not a frequent duty, he has

also accompanied truck drivers over the road to instruct them on clearance through the ports of

entry, and on one occasion, backing the truck into a dock. Cf. Zamora, 2008 WL 2369769, at *7-

8 (terminal managers occasional driving of trucks considered for one of the Lenz factors). His

written job description specifically contemplated that Akhondi would conduct “on-the-job

training.”

       The seventh Lenz factor asks whether a strike by the class of worker at issue would disrupt

commerce. Lenz, 431 F.3d at 352. The parties introduced no evidence below on that issue, though

presumptively a trucking company could operate without interruption at least for a time because

the orientation instructor focuses on new employees. We would weigh this factor somewhat in

OEP’s favor.

       In sum, three of the Lenz factors weigh in favor of Akhondi, and do so heavily enough to

counterbalance the opposing factors. As the trial court alluded to below, a truck is of no use

without a driver, and a driver cannot accomplish the job without a truck. Both are essential to

transporting goods. And just as the mechanic in Vasquez was essential in maintaining the truck,

there is some evidence in the record to support the trial court’s implied finding that Akhondi’s

position was essential in preparing the drivers to perform their job.

       Aside from the Lenz analysis, OEP places emphasis on a U.S. Department of Labor bulletin

explaining that “office personnel” are not exempt from overtime pay rules in the Fair Labor

Standards Act (“FLSA”). Without citation to authority, OEP’s brief claims the exemption only

applies to those “positions [which] are deemed to have a nexus between the work required and the

movement of goods within interstate commerce.” To the contrary, the exemption is based on

                                                 9
several factors, including the safety component of the job. Thus how the Department of Labor

treats classes of transportation workers on overtime pay is not determinative of how a court treats

them under the FAA.

        Generally, the FLSA requires an employer to pay overtime to any nonexempt employees

who work more than forty hours in a seven-day work week. See 29 U.S.C. § 207(a)(1). The

overtime pay rules in the FSLA, however, “shall not apply with respect to . . . any employee with

respect to whom the Secretary of Transportation has power to establish qualifications and

maximum hours of service pursuant to the provisions of section [49 U.S.C. § 31,502].” 29 U.S.C.

§ 213(b)(1). In turn, the Secretary of Transportation has the power to establish qualifications and

maximum hours of service for employees who (1) are employed by carriers whose transportation

of passengers or property by motor vehicle is subject to the Secretary’s jurisdiction under the

Motor Carrier Act; and (2) engage in activities of a character directly affecting the safety of

operation of motor vehicles in the transportation on the public highways of passengers or property

in interstate or foreign commerce within the meaning of the Motor Carrier Act. 29 C.F.R. §

782.2(a); Baez v. Wells Fargo Armored Serv. Corp., 938 F.2d 180, 181-82 (11th Cir. 1991).

Accordingly, the denial of an FSLA exemption could have as much to do a job lacking the

necessary safety component as its relation to the transportation of goods. By contrast, the

exemption in Section 1 of the FAA is not determined by the safety aspect of the job, but by whether

the class of employees are actually engaged in the movement of goods in interstate commerce.

Circuit City, 532 U.S. at 112, 121 S.Ct. at 1307. Accordingly, we fail to see how the lack of an

FSLA exemption for orientation instructors determines whether Akhondi is a transportation

worker for the purposes of the FAA.4

4
  Even at that, MVT’s director of recruiting conceded that some of the rules and policies that Akhondi taught were
safety sensitive. Moreover, the Department of Labor memo addresses “office personnel” and does not explicitly

                                                       10
         We hold that the trial court did not abuse its discretion in finding Akhondi to be a

transportation worker for purposes of 9 U.S.C. § 1 and consequently, that the arbitration agreement

is exempted from enforcement under the FAA.5

                                                        CONCLUSION

         OEP’s single point of error is overruled, and the judgment of the trial court is affirmed.

July 31, 2018
                                                SUSAN LARSEN, Senior Judge

Before Rodriguez, Palafox, JJ., and Larsen, J. (Senior Judge),
Larsen, J. (Senior Judge), sitting by assignment

mention orientation instructors. OEP claimed that Akhondi was an office worker who could do all of his instruction
in a simulator unit at the office. Akhondi testified that he taught the drivers in their trucks, and at times on the road.
Some evidence supports the trial court’s implied finding that Akhondi was more than just an office worker.
5
 Several courts have held that the Section 1 exemption in the FAA does not render the arbitration agreement void, it
merely precludes the FAA as the enforcement tool. See Valdes v. Swift Transp. Co., 292 F. Supp. 524, 527-29
(S.D.N.Y. 2003)(collecting cases); In re Weeks Marine, Inc., 242 S.W.3d 849, 853 (Tex.App.--Houston [14th Dist.]
2007, orig. proceeding)(“Jimenez argues the Agreement in this case is excepted from the FAA. If so, Weeks Marine
has remedy by interlocutory appeal under the Texas General Arbitration Act . . . .”); In re Swift Transp. Co. Inc., 311
S.W.3d 484, 491 (Tex.App.--El Paso 2009, orig. proceeding). At oral argument, Appellant affirmatively stated that
OEP does not claim the Texas act applies. Moreover, the parties have not addressed the enforcement of the arbitration
agreement under state law, either at the trial court, or in the briefing to this Court. Accordingly, that issue is not before
us and we do not address it.

                                                            11