Schmidt, Sethi & Akmajian Blog

Arbitration: Exemption From Mandatory Arbitration for Workers Engaged in Foreign Commerce

Posted by Ted A. Schmidt | Jun 07, 2022 | 0 Comments

Southwest Airlines Co. v. Saxon, No. 21-309 __U.S.___ (June 6, 2022)

Latrice Saxon brought this class action under the Fair Labor Standards Act of 1938  on behalf of fellow ramp supervisors claiming their employer Southwest Airlines was not paying them proper overtime wages.  Southwest moved to dismiss arguing plaintiffs' employment contract required the issue be arbitrated. Plaintiffs claimed that ramp supervisors were a “class of workers engaged in foreign or interstate commerce” and therefore exempt from the Federal Arbitration Act's coverage. 9 U. S. C. §1. The Federal District Court granted the motion, the United States Court of Appeals for the Seventh Circuit reversed and the United States Supreme Court affirmed the judgement of the court of appeals.

 Southwest argued the language in the exemption should be read narrowly to only include those workers actually involved in the physical transportation of goods and services across state lines.  The Supreme Court found that proper statutory interpretation rules required giving the language its broader interpretation.

“Latrice Saxon frequently loads and unloads cargo on and off airplanes that travel in interstate commerce. She therefore belongs to a “class of workers engaged in foreign or interstate commerce” to which §1's exemption applies.”

About the Author

Ted A. Schmidt

Ted's early career as a trial attorney began on the other side of the fence, in the offices of a major insurance defense firm. It was there that Ted acquired the experience, the skills and the special insight into defense strategy that have served him so well in the field of personal injury law. Notable among his successful verdicts was the landmark Sparks vs. Republic National Life Insurance Company case, a $4.5 million award to Ted's client. To this day, it is the defining case for insurance bad faith, and yet it is only one of several other multi-million dollar jury judgments won by Ted during his career. He is certified by the State Bar of Arizona as a specialist in "wrongful death and bodily injury litigation".


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