Argument Analysis: Doubtful Judges Regarding the Application of Arbitration Agreements for Transportation Workers

The argument of this morning in New Prime Inc. v. Oliveira posted something that probably has not been seen in this century: a Supreme Court court that mainly doubted the enforceability of an arbitration agreement.

The case at hand is a technical one, although of considerable practical importance: Whether the Federal Arbitration Act requires courts to apply arbitration agreements applies to independent contractors working in the field of arbitration. transportation industries (truckers, aircraft and boat workers, etc.) The Federal Arbitration Act provides an exemption for the "employment contracts" of these "workers". "Exempt" contract workers are much more likely to avoid arbitration (and retain the right to challenge their terms of employment in court). as workers from other industries. The specific issue before the Supreme Court is whether exempted "employment contracts" are limited to the employer / employee relationship or whether they also include contracts with independent contractors. This is important because many transport workers work as independent contractors rather than as employees.

The basic strategy of Theodore Boutrous (representative of the shipping company New Prime) was to argue that "work" contracts were limited to contracts with "employees"; Contracts with an independent contractor are simply not "employment contracts" within the meaning of the exemption. This strategy was met with stiff opposition from the first moments of the discussion, when Judge Sonia Sotomayor interrupted Boutrous to emphasize the choice of Congress to refer to "workers" rather than "employees" . As noted by Sotomayor, the status:

says that it will apply to any other category of "workers", not "employees". He used a much broader term. … We try to decide … what … "work contract" means. And if it concerned only employees, Congress … would naturally have used the word "any other class of employees", but instead chose a much broader word, "workers."

The situation seemed much worse for Boutrous when Chief Justice John Roberts quickly agreed with Sotomayor. Roberts noted how "quickly" Mr. Boutrous tried to "move from the notion of" contract of employment "to whether or not there was an employer-employee relationship. And simply because a person would be considered or not considered an "employee" does not necessarily answer the question of whether it is a contract of employment. Turning as he does so often for his personal sense of ordinary language habits, Roberts suggested that "[p]Everyone naturally thinks of appealing to an independent contractor ", which for him, at least, suggests that the issue to be resolved by the court" is not an employee / employer. It's a job. "

The situation got worse for Boutrous when Judge Neil Gorsuch reacted to present the argument presented in the brief in response to Dominic Oliveira (the worker). As always interested in theories of interpretation, Gorsuch asked Boutrous "[w]What do we do about the fact that … your colleague across the way documented it in 1925, when the law was enacted – [the law] It has not necessarily made the distinction between independent contractors and employees with the same degree of care that the law has come to use subsequently. Notice the wording of Gorsuch – he did not just say that Oliveira asserted that the understanding of "employees" was different in 1925; Gorsuch said that he himself was persuaded that it was different – because Oliveira's lawyer (Jennifer Bennett) had "documented" this to Gorsuch's satisfaction. Then, just to make sure there was no doubt about where he was, Gorsuch commented, "I do not think you agree that we should interpret it as a reasonable reader would have it at that time. "

Of course, if the distinction between "employee" and "independent contractor" was less precise in 1925 than it is today, Boutrous's link between "employment contracts" and "employees" must be even weaker. To make his doubts about Boutrous' position even clearer, Gorsuch then offered a moment of "catching him off guard," pointing out that even "your own client did not use" the distinction that Boutrous had advocated. Specifically, Gorsuch (apparently relying on Bennett's brief) described the company's description by the New Prime website as "employing" "independent contractors".

From that moment, the bench becomes relatively calm, two subjects dominating the rest of the discussion. The first concerned what Judge Ruth Bader Ginsburg called the "gateway" question – whether the scope of the federal law should be determined in the first instance by the court or the arbitrator. Boutrous had argued in its brief that the court should leave the question of arbitrability to the arbitrator, but several judges found this argument quite convincing. Ginsburg, for example, asked:[I]F [the statute] puts a whole category … apart from the act of arbitration, how can you use the act of arbitration? Similarly, Gorsuch suggested that "[b]Before a court could … make an order … a binding arbitration, I would have thought that he should have convinced himself that he had the power to issue such an order. Even Roberts felt that it would be "quite another thing to say that the arbitrator must decide if a court can … impose arbitration at all." In a court so opposed, Boutrous conceded more or less the point, acknowledging that "we would be happy if the Federal District Court interprets the contract or this Court. could do it."

For the most part, the judges allowed Bennett to argue without interruption. The main topic they discussed with her was how to manage the distinction between contracts with a company (like Federal Express), which would not be subject to the FAA, and contracts with a worker, who would be subject to the FAA, and contracts with a worker, who would be . Remarkably, she has not encountered any major difficulty in her main thesis that "work" contracts include both employees and independent contractors.

There can be little doubt about the outcome of a case like this, involving a dispute between a company and its workers in which Roberts and Gorsuch seem so strongly predisposed to side with the workers. Thus, despite the long list of cases that read the federal law on arbitration in the broad sense, this one presents all the indications of a victory for the worker who seeks to obtain a court appearance. Indeed, he could be a candidate for one of the first decisions of the mandate.

Posted in New Prime Inc. v. Oliveira, Featured, Case Background

Recommended citation:
Ronald Mann,
Argument Analysis: Doubtful Judges Regarding the Application of Arbitration Agreements for Transportation Workers,
SCOTUSblog (October 3, 2018, 6:26 pm),
http://www.scotusblog.com/2018/10/argument-analysis-justices-dubious-about-enforcing-arbitration-agreements-for-transportation-workers/