Defining ‘Transportation Worker’: SCOTUS (Again) Considers Scope of FAA Exemption

Takeaways

• The U.S. Supreme Court is considering whether drivers who make only intrastate deliveries — after goods have already arrived from out of state — fall within the FAA’s transportation worker exemption.
• The Court will be addressing a circuit split, and its decision could clarify employers’ ability to enforce arbitration agreements, especially in wage-and-hour actions. 
• A narrow ruling would preserve FAA coverage for many employers, while a broad ruling could expand challenges to arbitration across industries, though state-law arbitration may still apply.

Related link

• FAA’s Transportation Worker Exception Covers Airline Ramp Agents, U.S. Supreme Court Holds

Article

The U.S. Supreme Court heard argument on March 25, 2026, in Flowers Foods, Inc. v. Brock (No. 24-935), a case addressing the Federal Arbitration Act’s (FAA) transportation worker exemption. 9 U.S.C. § 1. The exemption excludes from FAA coverage “contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.” At issue is the scope of workers covered by the exemption’s “any other class of workers” clause.

If a worker falls within the “other class of workers” provision, the exemption applies. That means the worker is not required to arbitrate their claim under the FAA (but may still be subject to arbitration under state law). The issue is an important one for companies seeking to enforce employment arbitration agreements, particularly when facing a class or collective action suit.

Transportation Worker Exemption Cases

The transportation worker exemption is before the Supreme Court for the third time in recent years.

In Southwest Airlines Co. v. Saxon, 596 U.S. 450, a 2022 decision, the Court held that ramp workers who load and unload cargo for an airline are transportation workers exempt from the FAA. Although the ramp workers did not physically transport cargo across state lines, the Court determined that the workers were engaged in foreign or interstate commerce because “one who loads cargo on a plane bound for interstate transit is intimately involved with the commerce (e.g., transportation) of that cargo.” The Court rejected the airline’s argument that the exemption applied only to employees who physically move goods across states while on board a plane or other vehicle.

In a footnote, the Court in Saxon suggested that last-mile delivery drivers and food delivery drivers are “further removed” from the channels of interstate commerce and that whether these workers fall within the exemption would not be so clear. The Court reserved that question for another day.

In Bissonnette v. LePage Bakeries Park Street, LLC, 601 U.S. 246, a 2024 decision, the Court considered whether truck drivers who delivered baked goods from warehouses to retail outlets within the same state were transportation workers. At issue was whether workers had to be employed in the transportation industry to fall within the exemption. The U.S. Court of Appeals for the Second Circuit held that the truck drivers were part of the baking industry, not the transportation industry, and so were not transportation workers exempt from the FAA. Rejecting the Second Circuit’s industry-focused analysis, the Court held that the exemption was not limited to workers employed in the transportation industry.

Again, the Court reserved the question whether the drivers fell outside the exemption for the alternative reason that they delivered baked goods only within the state.

Brock Case

In Brock, the Court takes up the question it has twice reserved: whether workers who locally deliver goods that travel in interstate commerce, but who do not transport the goods across state lines themselves, fall within the FAA’s transportation worker exemption.

In the decision below, the Tenth Circuit affirmed a Colorado district court’s denial of a motion to compel arbitration of a lawsuit brought by independent distributors who deliver bread and other baked goods from a Colorado warehouse to retail outlets within Colorado. The goods are shipped to the warehouse from out of state by others, but the drivers in the lawsuit never cross state lines when completing their local deliveries.

The Tenth Circuit concluded that the transportation worker exemption applied. In reaching its conclusion, the court focused on the fact that, although the drivers did not cross state borders in making the deliveries, the goods they delivered were manufactured out of state, and the drivers were the final leg of the overall interstate flow of these goods. Therefore, in the Tenth Circuit’s view, the workers were directly and necessarily engaged in the transportation of goods interstate such that the transportation worker exemption applied.

SCOTUS to Decide: The Interstate Work or the Final Destination?

During oral argument, Flowers Foods argued that the Supreme Court should focus on the work the particular worker performs and whether that work is interstate to determine applicability of the transportation worker exemption. Flowers Foods argued that it is not enough that the goods delivered by the drivers traveled through an interstate supply chain, because FAA coverage turns on the work performed by the worker, not the goods that travel interstate.

Flowers Foods stressed that “crossing a border matters: it matters from a legal perspective, and it’s express in [the text of the exemption].” As framed by Flowers Foods, “The question is when does the interstate journey end? And it ends at the warehouse, when the goods are unloaded by someone other than Mr. Brock.”

Angelo Brock’s counsel countered that the focus should be the intended final destination of the goods, i.e., if the intended final destination of the goods is interstate, the entire chain of events within the process should be considered interstate, even if the specific worker’s work in the chain was intrastate. In other words, according to Brock’s counsel, so long as the intended final destination of the goods is in another state, each worker who transported the goods to that intended destination is a transportation worker exempt from the FAA.

The Court appeared at least partly divided, with justices focusing their questions on different aspects of the issue. Some justices questioned why two drivers doing essentially the same job could be treated differently based solely on whether their particular leg of the interstate journey happened to cross a state line or involve a specific vehicle. Justice Elena Kagan, for example, remarked: “[T]hey’re all driving the trucks that get your bread from the factory to the supermarket. That’s what all of them are doing … and when … that trip is an interstate trip, they’re all doing the same thing, regardless of the happenstance of whether one or the other of them is crossing a state line.”

Justice Neil Gorsuch seemed focused on establishing a bright-line rule, a concern that Flower Foods argued favored its position. Justice Gorsuch distilled the issue in his discussion with Flower Foods as follows: “All we need to decide in this case is [Flower Foods’] proposed bright-line rule that you’re [not] in interstate commerce unless you drive across state lines or … interact with vehicles that do.”

Justice Samuel Alito similarly explored with Brock’s counsel whether an administrable, bright-line rule could be drawn. Stressing, in his view, the potential murkiness of ascertaining the intended final destination for goods under Brock’s proposed test, Justice Alito remarked: “I find … your [Brock’s] argument extremely confusing …. I would think that anyone who produces consumer goods intends for the final destination of those goods to be with the consumer …. So I don’t understand what it means to ask what is the intended end point of [the] distribution chain.”

Takeaways

For employers, a decision favoring a narrow interpretation of the transportation worker exemption would preserve FAA coverage and potentially stem the tide of litigation over whether the exemption applies to a worker.

A broader reading of the exemption could invite more challenges to the enforcement of arbitration agreements across different industries and across a broader category of workers. In their petition for certiorari, Flowers Foods cautioned that the Tenth Circuit’s approach, if adopted, “will void arbitration agreements in almost every sector of the economy, pulling every worker who handles goods moving in interstate commerce—including warehouse workers and retail shelf stockers who never touch a vehicle at all—into § 1’s orbit.”

However the Court rules, employers should remember that enforcement of an arbitration agreement does not rest solely on the transportation worker exemption and the FAA’s applicability. Although applicability of the transportation worker exemption may mean an arbitration agreement is not subject to the FAA, the agreement nonetheless may still be enforceable under applicable state law.

The Court’s decision is expected by late June, when the Court’s term typically ends.

Contact a Jackson Lewis attorney if you have questions about the scope of the FAA transportation worker exception or the enforceability of arbitration agreements.