Supreme Court Clarifies FAA Arbitration Exception Not Limited To Transportation Workers

On April 12, 2024, the Supreme Court issued its decision in Bissonnette v. LePage Bakeries Park St., LLC, 601 U.S. __ (2024). It unanimously held that the exception to arbitration under Section 1 of the Federal Arbitration Act (FAA) is not limited solely to employees of a company in the transportation industry, but, rather, focuses on whether the employee is involved in interstate commerce.

Under the FAA, arbitration agreements are "valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract."¹ The FAA, however, contains an exception to this. Specifically, 9 U.S.C. § 1 states, in relevant part, that the FAA shall not "apply to contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce." Courts, including the Supreme Court, have struggled with what this exception means.