I have written on this site about how a 1925 statute meant to help merchants settle commercial disputes became the instrument that pushes ordinary people out of court. That piece was not optimistic, because the trend has run in one direction for a long time.
So it is worth noting when it runs the other way.
On May 28, 2026, in Flowers Foods, Inc. v. Brock, a unanimous Supreme Court held that a delivery driver need not cross state lines — or even work with a vehicle that does — to qualify as a “transportation worker” exempt from the Federal Arbitration Act. Justice Gorsuch wrote for the Court. The decision came out of the Tenth Circuit and affirmed the courts below.
For a category of workers who have spent a decade being routed into individual arbitration, this is a significant and genuinely favorable development.
The exemption everyone forgets exists
The Federal Arbitration Act, enacted in 1925, requires courts to enforce arbitration agreements. That much everyone knows.
Less well known is that the FAA has always excluded a category of workers from its reach — a residual clause in Section 1 exempting “workers engaged in foreign or interstate commerce.” The exemption is old, it is in the original statute, and for most of the FAA’s history it did comparatively little work, because the modern practice of putting arbitration clauses in every employment agreement did not yet exist.
That changed. As arbitration clauses spread into essentially all employment and independent-contractor agreements, the Section 1 exemption became one of the few doors left, and litigation over its scope intensified.
The recurring question: how much interstate movement does a worker need?
The argument the Court rejected
Angelo Brock was a Denver-based delivery franchisee for Flowers Foods, a large baked-goods company. He filed a putative class and collective action in Colorado federal court alleging underpayment under the Fair Labor Standards Act. Flowers Foods moved to compel arbitration.
The company’s position was one that had been gaining traction: Brock drove locally. His routes were within Colorado. He did not personally carry anything across a state line. Whatever the exemption covers, the argument ran, it should not cover a driver whose own work is entirely intrastate.
The district court disagreed and denied the motion. The Tenth Circuit affirmed. And the Supreme Court affirmed unanimously, finding nothing in the statute “requiring crossing state lines or interacting with a vehicle that does so.”
The holding is that workers engaged in the intrastate delivery of goods destined for or arriving from interstate commerce fall within the exemption. What matters is the character of the goods’ journey, not the geography of the individual worker’s leg of it.
Why this matters more than it sounds
The phrase “last-mile driver” undersells the reach of this.
The last mile is where an enormous share of the modern economy’s labor now sits. Goods move across the country in bulk and are then delivered locally by drivers who are frequently classified as independent contractors, frequently paid in ways that generate wage disputes, and — until now — frequently held to arbitration clauses on the theory that their own routes never left the state.
That theory is gone. And the reasoning is not limited to bread trucks. Any worker moving goods locally as part of a longer interstate journey has a strong argument under this decision.
The practical consequence is the one that matters. Arbitration clauses in this sector are individual by design, paired with class-action waivers. A driver with a $9,000 wage claim who is sent to individual arbitration has, realistically, no remedy — the case costs more to bring than it can recover. The same claim as part of a collective action against a national employer is a case that gets litigated. Whether the FAA applies is therefore not a procedural technicality; for these workers it is frequently the difference between a claim and no claim.
What this does not do
Some necessary caution, because a favorable decision invites overreading.
It does not make the arbitration agreement void. It holds that the FAA does not compel arbitration of these claims. State arbitration law may still apply, and employers will litigate that. The FAA is the most powerful tool for compelling arbitration; it is not the only one.
It does not reach beyond transportation. The Section 1 exemption is limited to transportation workers. A retail employee, a nurse, or a software developer with an arbitration clause is not helped by this decision.
It does not resolve every boundary. “Engaged in interstate commerce” is now clearly not about state lines, but the outer edges will be litigated for years — how attenuated can the connection to interstate movement be, what about goods manufactured and sold entirely in-state, what about workers who handle goods but do not transport them.
And it does not touch classification. Brock was a franchisee. Whether workers in these arrangements are employees or independent contractors is a separate and often dispositive question, and this decision says nothing about it.
The broader point
I want to resist the temptation to read a trend into a single case. One unanimous decision does not reverse forty years of arbitration jurisprudence, and the structural problems I have written about — class-action waivers, clauses nobody reads, the arithmetic that makes small claims uneconomical to bring individually — are entirely intact.
But it is worth noticing what the Court actually did here. It read the statutory text, found no requirement that a worker personally cross a state line, and declined to add one. That is a straightforward exercise in reading a statute as written, and it happened to favor the workers because the text does.
That is a reminder worth holding onto. The arbitration regime that has grown up over the last four decades was built substantially through interpretation — of a 1925 statute whose drafters were thinking about merchants, not consumers or gig drivers. Interpretation that expanded it can also be interpretation that limits it, and the limits are found in the same place: the words Congress actually enacted.
If you are a delivery driver or transportation worker who has been told your wage claim must go to arbitration, the answer may have changed. Send us a message or call 612-470-6529.
Source: Flowers Foods, Inc. v. Brock (U.S. May 28, 2026) (Gorsuch, J.). This article is general commentary on a published decision, not legal advice, and reading it does not create an attorney–client relationship. Whether the exemption applies to any particular worker depends on facts specific to that person’s work and agreement. No outcome is promised or implied.