The most publicized legal development in the area of independent contractor law last month involved an opinion issued by a federal appellate court in a gig economy case that generated national attention. In a decision discussed below, the United States Court of Appeals for the First Circuit held that local couriers who make deliveries to Postmates’ customers of products they pick up from retail stores are not interstate transportation workers. As a result, the court held that the couriers do not fall into the interstate transportation exemption from arbitration under the Federal Arbitration Act. In reaching this decision, the First Circuit distinguished the couriers from drivers making last-mile deliveries of products for Amazon, whom the court found to be interstate transportation workers under the federal arbitration law. While this Postmates decision provides companies involved in local delivery services with additional legal authority when they seek to compel arbitration of a proposed class action, the decision is not nearly as momentous as many commentators have suggested. Why? Because companies can also compel arbitration under state arbitration laws, almost all of which do not contain an exemption for interstate transportation workers. We pointed that out in a blog post last year involving a case holding that certain ride-sharing drivers were exempt from arbitration under the Federal Arbitration Act but were nonetheless compelled to arbitrate under a state...
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