FIRST CIRCUIT RULES LYFT DRIVERS ARE BOUND BY EMPLOYEE ARBITRATION AGREEMENTS AND DO NOT QUALIFY FOR NARROW “TRANSPORTATION WORKER” EXEMPTION UNDER FEDERAL ARBITRATION ACT : New England Legal Foundation Amicus Brief Position Prevails in Case – Drivers Unsuccessful in Class Certification Effort
BOSTON – The United States Court of Appeals for the First Circuit ruled last week that Lyft drivers are required to abide by the terms of their employment agreements and individually arbitrate their disputes with ride share company Lyft, rather than suing as a class, in their claim for misclassification as independent contractors, rather than employees. The New England Legal Foundation filed an amicus brief in support of Lyft’s successful position, providing forceful arguments that are strikingly similar to the reasoning adopted by the Circuit Court.
NELF Senior Staff Attorney Ben Robbins, who authored the amicus brief, said that “The plaintiffs do not qualify under the narrow “transportation worker” exemption to the FAA, because they do not “engage in interstate commerce” as their primary activity, unlike the named exempted categories of “seamen” and “railroad employees,” who are engaged primarily in the robust and carefully planned transportation of goods and passengers across state lines. The Lyft drivers are really just the modern-day equivalent of the local cab driver, and nothing more, for purposes of the FAA’s “transportation worker” exemption.” The decision is significant because what was at stake was whether the plaintiffs could proceed with a class action in court, on their claim of misclassification as independent contractors, or whether they were bound to arbitrate their claims, on an individual basis only, according to the terms of Lyft’s arbitration agreement with them.
Dan Winslow, President of the New England Legal Foundation, noted that “The gig economy has an increasing importance to empower people to engage in free enterprise and to lift themselves up to prosperity. The New England Legal Foundation stands ready to challenge over-regulation and impediments to free enterprise and we are thrilled with the outcome of this case.
About the New England Legal Foundation: For nearly 50 years, the New England Legal Foundation has filed amicus briefs and impact litigation in support of free enterprise, property rights, good and limited government, and inclusive economic growth.