U.S. Supreme Court: Airline Ramp Workers may not be compelled to arbitrate under FAA

In an opinion last summer, Southwest Airlines Co. v. Saxon (Case No. 21–309, June 2022), the United States Supreme Court ruled that an employee in a Fair Labor Standards Act case against the employee’s airline employer may not be compelled to arbitrate such claims. The Federal Arbitration Act (“FAA”) will generally require parties to arbitrate their disputes when they have signed an otherwise enforceable agreement to arbitrate, but FAA excludes contracts to arbitrate involving employees who are engaged in interstate commerce. The Court held here that, even though the ramp agent herself did not cross state lines in the performance of her duties (she performed all her duties on the ground), she was nonetheless engaged in interstate commerce, and thus not subject to FAA arbitration: “…airline employees who physically load and unload cargo on and off planes traveling in interstate commerce are, as a practical matter, part of the interstate transportation of goods.”

While this case has broader implications outside the labor milieu, which has other labor laws regarding arbitration of grievances (e.g., the Railway Labor Act, the Labor Management Relations Act, to name two), it still may figure into some labor actions and is, in any event, of some interest to the arbitration community. For a great discussion of the decision, see https://law.missouri.edu/arbitrationinfo/2023/01/03/2022-in-review-thoughts-on-southwest-v-saxon-142-s-ct-1783/.