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Court of Appeal:
Driver Performing Local-Only Deliveries
Is Interstate Transportation Worker Baltodano Says Federal Arbitration Act Exemption Applies
By a MetNews Staff Writer
Div. Six of this district’s Court of Appeal held yesterday that a delivery driver who only works within California is an interstate transportation worker for purposes of the exemption from coverage under the Federal Arbitration Act where the packages she delivered originated from any number of states and foreign countries.
Justice Hernaldo J. Baltodano authored the unpublished opinion which affirms the denial by Ventura Superior Court Judge Benjamin F. Coats of a motion to compel arbitration. Presiding Justice Arthur Gilbert and Justice Kenneth R. Yegan joined in the opinion.
Appealing the denial was SDLA Courier Service, Inc., a delivery company located in Southern California which makes local-only deliveries in California for its customers. One such customer is Amazon Logistics, Inc., for which SDLA drivers pick up packages at Amazon warehouses in California and deliver them.
Plaintiff Samantha Peters worked as a delivery driver and dispatcher for SDLA from September 2018 to July 2019. She signed an arbitration agreement governed, according to its terms, by the Federal Arbitration Act (“FAA”), codified at 9 U.S.C. §1 et seq.
Peters sued SDLA, asserting individual and putative class claims for alleged wage and hour violations. SDLA moved to compel arbitration of the individual claims, arguing that the transportation worker exemption found under 9 U.S.C. §1 did not apply as Peters did not engage in any foreign or interstate commerce.
Transportation Worker Exemption
Baltodano noted that “Section 2 of the FAA provides that contracts ‘evidencing a transaction involving commerce to settle by arbitration’ ‘shall be valid, irrevocable, and enforceable.” However, the jurist pointed out that the act provides for an exemption.
Sec. One of the act provides that “nothing herein contained shall apply to contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.”
Baltodano pointed out that not all employees who work for a transportation company qualify under the exemption, saying:
“In determining whether a class of workers are ‘engaged in foreign or interstate commerce,’ the inquiry focuses on the worker and the work they perform.”
He continued:
“The question here is whether delivery drivers such as Peters, who worked for an intrastate delivery company, are exempt from the FAA coverage under the transportation worker exemption.”
Last Leg Delivery
Baltodano looked at the big-picture of the delivery process and remarked that “Peters’s delivery of Amazon packages to its final destination played” an integral role in the transportation of packages across borders, remarking:
“Without last-leg delivery drivers, such as Peters, the transportation of these packages would be incomplete.”
He reasoned:
“Contrary to SDLA’s argument, it is inconsequential that Peters and SDLA delivered only within the state of California. An employee does not need to cross state lines for the exemption to apply.”
Given that the last-leg delivery fits into the larger scheme of transportation of good across state lines, Baltodano said:
“We…conclude that Peters was…engaged in interstate commerce when she participated in the last leg of the delivery of out-of-state packages.”
He pointed out in a footnote that “[t]o the extent the parties dispute whether Peters was a delivery driver throughout her employment, the trial court found Peters was a driver” and the appellate court defers to Coat’s finding.
Consistent With Other Courts
In reaching its conclusion, Baltodano noted that the decision aligns with that of “[o]ur colleagues in the First District” and the Ninth U.S. Circuit Court of Appeals, which each determined that last-mile delivery drivers for Amazon were interstate transportation workers under the exemption.
He found unpersuasive SDLA’s attempt to distinguish the cases on the grounds that SDLA is a purely intrastate delivery company offering no interstate delivery services. He wrote:
“In our view, Peters and SDLA were engaged in interstate commerce. SDLA drivers performed the last-mile delivery of out-of-state packages to their final destination and were thus ‘still a part of a continuous interstate transportation.’”
The case is Peters v. SDLA Courier Service, Inc., B330142.
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