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US Supreme Court throws out ruling on arbitration of job disputes
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US Supreme Court throws out ruling on arbitration of job disputes
Apr 12, 2024 7:46 AM

April 12 (Reuters) - The U.S. Supreme Court on Friday

gave a boost to a delivery truck driver's bid to expand the

universe of employees in interstate commerce who are exempted

from mandatory arbitration of legal disputes beyond workers at

transportation companies.

The justices, in a 9-0 ruling, threw out a lower court's

dismissal of proposed class action litigation by Neal

Bissonette, a delivery driver for LePage Bakeries Park Street, a

unit of Wonder Bread maker Flowers Foods ( FLO ). Bissonette has

said Flowers Foods ( FLO ) deprives drivers of wages by treating them as

independent contractors rather than employees.

Many companies require workers to sign arbitration

agreements and claim individual arbitration is quicker and more

efficient than resolving disputes in court. Critics of the

practice have said it prevents companies from being held

accountable for legal violations that affect large numbers of

workers.

The Federal Arbitration Act (FAA), dating to 1925, requires

arbitration agreements to be enforced according to their terms

but exempts employment contracts "of seamen, railroad employees,

and any other class of workers engaged in foreign or interstate

commerce."

The Supreme Court in a 2001 ruling said the exemption

applied only to transportation workers. Since then, appeals

courts have split over whether that means any worker who

transports goods or only those employed by companies that

provide transportation services.

The New York-based 2nd U.S. Circuit Court of Appeals in 2022

decided that the exemption did not apply to LePage's case

because the company's customers were purchasing bread and not

transportation services.

Bissonette accused LePage of misclassifying drivers who

delivered baked goods to retailers as independent contractors

and depriving them of minimum wage, overtime pay and other legal

protections.

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