On May 28, 2026, a unanimous Supreme Court held in Flowers Foods, Inc. v. Brock, 608 U.S. ___ (2026), that a worker who transports goods on a purely intrastate leg of an interstate journey can fall within Section 1 of the Federal Arbitration Act, even if the worker never crosses state lines and never interacts with a vehicle that does. Writing for the Court, Justice Gorsuch affirmed the Tenth Circuit and rejected the bright-line “cross-or-tag” rule urged by the employer. The decision is the fourth in the Court’s recent line of Section 1 cases, and for companies that depend on local delivery and franchise distribution networks, it narrows the availability of FAA arbitration against those workers while sharpening the defenses that remain.
The FAA generally requires courts to enforce private arbitration agreements, but Section 1 carves out “contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.” 9 U.S.C. § 1. A worker who falls within that exemption cannot be compelled to arbitrate under the FAA.
The Court has construed the exemption three times in recent years, each time declining to cabin its reach. In one such decision, it held that “contracts of employment” reach independent-contractor agreements, not just employees. In another, it held that an airline cargo loader was covered even though she never flew planes or crossed state lines. And in a third, it held that a worker may qualify regardless of...
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