Yesterday’s decision in Flowers Foods v. Brock held that an exemption from the Federal Arbitration Act for interstate transportation workers extends to “last-mile” drivers who don’t themselves cross state lines, even though the goods they are delivering are on an interstate journey. That holding protects them from the FAA’s requirement that they litigate disputes with their employers in arbitration as opposed to a court.
Justice Neil Gorsuch’s opinion for a unanimous court is as succinct as you would expect from the one-sided discussion at oral argument. He starts by pointing out that the court recently has considered the interstate transportation exception from the FAA “no fewer than three times,” and that it has “rejected efforts to cabin its reach” on each occasion. After summarizing the previous holdings he bluntly states: “Make this case the fourth.” The “sole theory” that the employer presents, he emphasizes, is that to qualify for the interstate transportation exception “a worker must either cross state lines or interact with a vehicle that does (say, by loading or unloading the goods it carries).”
Gorsuch basically makes two points. First, as you might expect, he suggests we “[s]tart with the statutory text,” which protects “workers engaged in … interstate commerce.” Because “engage,” when the statute was written (as now) means “to take part in” or to be “involved” with, “[n]othing … requires an individual to cross state lines or interact with a vehicle that does.” Although interstate commerce may require “transporting products ‘between points in one state and points in another state[,]’ … a person can ‘take part’ … or be ‘involved’ in that continuous journey without leaving a State or touching vehicles that do.”
Gorsuch offers a hypothetical (modeled on the highly successful products of the employer Flowers Foods) of a contract by a company in one state to purchase a truckload of Butterscotch Krimpets from a company that is based in and makes the Krimpets in another state. He posits the idea that the seller
hires three drivers to make the delivery. Driver 1 takes the Krimpets from [the] bakery right up to the border …. Driver 2 then picks up the Krimpets, drives ten feet across the border, puts the Krimpets down again, and heads off. Finally, Driver 3 picks up the Krimpets and delivers them to [the buyer]. Who was engaged in interstate commerce?
Under the rule the employer offers, only Driver 2. But for Gorsuch “that cannot be right. Each of the drivers played a direct, active, and necessary part in ensuring the Krimpets got from a point in [the state of the bakery] to a point in [the state of the buyer] as the contract required.”
Gorsuch’s second point is that this kind of multi-step transportation arrangement “is hardly a hypothetical at all,” as the court considered it in at least four cases in the 19th and early 20th centuries. Those cases all determined that particular transactions involved “interstate commerce” for purposes of the commerce clause of the Constitution, which grants Congress the power to regulate interstate commerce. For example, the earliest of the cases involved “a steamer transporting goods on Grand River operated ‘entirely within the limits of’ … Michigan.” Because the steamer “was employed in transporting goods destined for other states,” Gorsuch explains, the court held that it “was engaged in commerce between the states.”
Gorsuch acknowledges that various facts of the employee’s operations might support a conclusion that this particular transaction did not involve interstate commerce, but he stops short of considering their relevance, explaining that the employer “does not ask us to decide their legal significance,” because the employer “ventures it all upon one cast, asking us to adopt a bright-line rule that an individual can never qualify for [the] exemption unless he crosses state lines or interacts with vehicles that do.” For Gorsuch, “whatever other limits [the statute] may or may not contain, we do not see how the statutory text can support that one.”
On the issues before the court, I doubt this case will make a lot of waves, as it upheld the judgment of the lower court. At most, I would say, it will give lower courts caution in construing the exemption so narrowly. Also, Gorsuch’s pointed reference to four consecutive cases upholding the claims of employees to the exemption probably will not go unnoticed.
