On May 28, 2026, the Supreme Court unanimously held in Flowers Foods, Inc. v. Brock (No. 24–935) that a worker may qualify for the transportation worker exemption in § 1 of the Federal Arbitration Act (FAA) even if the worker never personally crosses state lines or transports goods across state borders. In the opinion written by Justice Gorsuch, the Court concluded that the relevant inquiry is not whether the worker’s own route is interstate, but whether the worker plays a direct and necessary role in the interstate movement of goods.
As summarized in Dykema’s April 2026 edition, Angelo Brock operated a local distribution route in Colorado, delivering baked goods from an in-state warehouse to retail stores. Although his deliveries occurred entirely within Colorado, the products originated outside the state and entered Colorado through Flowers Foods’s interstate distribution network. When Brock brought wage-related claims, Flowers Foods sought to compel arbitration under the parties’ distributor agreement. Brock responded that the FAA did not apply because § 1 exempts certain transportation workers engaged in interstate commerce.
The Court rejected Flowers Foods’s proposed bright-line rule limiting the exemption to workers who themselves transport goods across state lines. Instead, the Court focused on the statutory text, emphasizing that § 1 asks whether the worker is engaged in interstate commerce, not whether the worker personally crosses state boundaries. As Justice Gorsuch explained, the inquiry does not turn “on a game of tag with vehicles who do.” Rather, the relevant inquiry is whether the worker plays a direct, necessary, and active role in the interstate movement of goods.
The Court reinforced that textual analysis through historical precedent. Relying on decisions such as The Daniel Ball, 10 Wall. 557 (1871), Rhodes v. Iowa, 170 U.S. 412 (1898), and Rearick v. Pennsylvania, 203 U.S. 507 (1906), the Court explained that goods may remain in interstate commerce even when particular segments of their transportation occur entirely within a single state. Viewed against that historical understanding, the Court concluded that Brock’s local deliveries represented the final leg of an interstate journey rather than a separate, purely intrastate enterprise.
The Court similarly rejected Flowers Foods’s argument that engaged in interstate commerce should be construed more narrowly than similar language appearing in Commerce Clause jurisprudence. The Court concluded that § 1 encompasses workers who actively participate in moving goods through interstate commerce.
The opinion is equally notable for what it does not hold. Rather than attempting to resolve every factual circumstance relevant to § 1’s transportation worker exemption, the Court addressed only the categorical rule advanced by Flowers Foods—that a worker can never qualify unless he personally crosses state lines or interacts with vehicles that do. Having rejected that rule as inconsistent with the statutory text, the Court had no occasion to decide whether other factual considerations, such as the contractual structure of the parties’ relationship or the passage of title to the goods, bear on the § 1 analysis.
Takeaways
The Court’s decision is narrow. It does not address whether the workers in the case were transportation workers or whether they were engaged in interstate commerce. Nor did it address or resolve whether the drivers were employees or independent contractors. The Court explicitly declined to create a bright-line rule that automatically sweeps all local drivers into the FAA exemption. As the Court’s decision focuses strictly on the Federal Arbitration Act, it did not rule that all arbitration agreements are invalid, leaving employers the ability to potentially enforce these clauses under state arbitration laws. The ruling does not meaningfully alter the FAA § 1 landscape because the Court in Southwest Airlines Co. v. Saxon, 596 U.S. 450 (2022), already held that the § 1 inquiry focuses on the workers’ job duties to render them “transportation workers.”
Nevertheless, companies utilizing local delivery networks should evaluate not only where transportation occurs, but also whether particular workers are performing an integral part of an interstate distribution system. At the same time, additional important questions concerning owner-operators, contracts of employment, and the effect of taking title to goods remain unresolved and are likely to generate additional litigation.
For more information, please contact Chantel Febus, James Azadian, Monika Harris, or David Ter-Petrosyan.