El Paso Transportation Workers Win The Day! New Prime Inc. v. Oliveira

For the first time in more than a decade, opponent’s of arbitration agreements win the day. Justice Neil Gorsuch, in a unanimous decision, states that an exception to the rule exists regarding the requirement that obligates court’s to enforce arbitration agreements that involve interstate commerce. The Federal Arbitration Act (FAA), generally requires worker’s to arbitrate if a valid arbitration agreement exists. In this case, all agree that the truck drivers (including respondent Dominic Oliveira) driving trucks for petitioner New Prime are “workers engaged in foreign or interstate commerce.” However, transportation workers have long been excluded from this requirement. However, many companies were able to get around this rule by entering into independent contractor relationships in lieu of the traditional employee-employer relationship. This unanimous decision changes that. The question for the court is whether the lower courts should have sent this dispute to arbitration even though the drivers might work for New Prime as independent contractors rather than as employees. The Supreme Court held that the exclusion for transportation workers removes both employer-employee contracts and contracts involving independent contractors from the FAA’s coverage. The Court also held that a court should decide for itself whether Federal Arbitration Act's exclusion for “contracts of employment” of certain transportation workers applies before ordering arbitration.


*For more information see the following: Ronald Mann, Opinion analysis: Justices uphold arbitration exemption for transportation workers in rare victory for arbitration opponents, SCOTUSblog (Jan. 15, 2019, 4:24 PM), https://www.scotusblog.com/2019/01/opinion-analysis-justices-uphold-arbitration-exemption-for-transportation-workers-in-rare-victory-for-arbitration-opponents/