Ninth Circuit Finds Amazon Delivery Drivers Exempt from Arbitration
On August 19, 2020, the Ninth Circuit Court of AppealsFN1 ruled that Amazon delivery drivers are transportation workers engaged in interstate commerce and thus exempt from the Federal Arbitration Act (“FAA”), even if they only make deliveries in one state. FN2
The FAA requires courts to enforce arbitration agreements, but it does not apply to “contracts of employment” with seamen, railroad employees, and other workers engaged in foreign or interstate commerce.FN3 This is commonly referred to as the “transportation worker exception” or exemption of the FAA.
The Court affirmed the denial of Amazon’s motion to compel Amazon delivery workers – even so-called “last-mile” drivers who made purely local or intrastate deliveries - to pursue their federal and state wage and hour claims in arbitration, finding that drivers did not have to physically cross state lines to fit the definition of a transportation worker. The Court agreed with the District Court’s reasoning that drivers “delivered packaged goods that are shipped from around the country and which are delivered to consumers untransformed."FN4
Takeaway
Companies should take note that employees who are transportation workers, even within one state, may be engaged in interstate commerce for purposes of being exempt from the FAA. As such, arbitration agreements involving these workers must be carefully crafted to be enforceable. Please contact the attorneys at Campbell Litigation, P.C. for assistance.
Footnotes:
FN1 - The Ninth Circuit Court of Appeals hears appeals from federal courts in Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, and Washington State.
FN2 - Rittmann v. Amazon.com, Inc., No. 19-35381 (9th Cir. 2020). See https://cdn.ca9.uscourts.gov/datastore/opinions/2020/08/19/19-35381.pdf
FN3 - 9 U.S.C. § 1
FN4 –The First Circuit Court of Appeals made a similar finding against Amazon in July 2020, find that Amazon’s delivery drivers are transportation workers engaged in interstate commerce even if they only make deliveries in one state. See
Read more at: https://www.law360.com/articles/1293305?copied=1.