Court Uses 8-Factor Test To Hand Gig Businesses Victory In Next Round In New Prime Arbitration Battle 

From Mondaq, Richard R. Meneghello discusses the recent Massachusetts case which found that a DoorDash driver was not a “transportation worker” under the Federal Arbitration Act (FAA), was not entitled to the transportation worker exemption, and therefore an arbitration agreement between DoorDash and its driver should be enforced. Richard writes:

U.S. District Court Judge Indira Talwani rejected Austin’s argument and upheld DoorDash’s arbitration agreement. She cited to an eight-factor test to ultimately determine whether the worker should be considered a “transportation worker” under the FAA and thus exempted from arbitration provisions. “While several of these factors weigh in favor of finding Plaintiff to be a transportation worker,” she said, “others weigh against that finding. Reviewing these together, the court finds that Plaintiff is not a transportation worker exempted from the FAA.”

The factors that actually worked in favor of the DoorDash driver being considered a “transportation worker” were:

  1. Whether the employee works in the transportation industry (as he works as a driver);
  2. Whether the vehicle itself is vital to the commercial enterprise of the employer (his vehicle is vital to the company’s commercial enterprise);  and
  3. The nexus that exists between the employee’s job duties and the vehicle the employee uses in carrying out his duties (there is a complete nexus between his duties as a delivery driver and the vehicle he uses in carrying out his duties).The court then said that one factor was irrelevant to the discussion:
  4. Whether the employee supervises employees who are themselves, transportation workers, such as truck drivers (since this factor is meant to broaden the exemption to workers who do not directly engage in transporting goods).Also, another factor neither helps nor hurts either side:
  5. Whether, like seamen or railroad employees, the employee is within a class of employees for which special arbitration already existed when Congress enacted the FAA (because gig workers did not exist in 1926 when the FAA was enacted)But three factors outweighed the others and led Judge Talwani to rule in DoorDash’s favor.
  6. Whether the employee is directly responsible for transporting the goods in interstate commerce (as Austin never alleged he crossed state lines while delivering food for DoorDash);
  7. Whether the employee handles goods that travel interstate (the court found that there was insufficient justification for the argument that some of the food that may have been part of the prepared delivery service originated in other states); and
  8. Whether a strike by the employee would disrupt interstate commerce (this factor was not explicitly discussed by the court, but it seems obvious that a “strike” by a gig worker isn’t a real threat, and even if a random gig delivery driver stopped working for a day – which they do frequently – it would have no impact on the nation’s interstate commerce).

Read the full story Court Uses 8-Factor Test To Hand Gig Businesses Victory In Next Round In New Prime Arbitration Battle – Employment and HR – United States

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