The Supreme Court rejected a lawsuit about whether Uber drivers who work principally in a single state can rely on the Federal Arbitration Act (FAA) to opt out of mandatory arbitration agreements they signed.
The drivers said Uber miscategorized them as independent contractors instead of employees. As employees, they would have been entitled to full benefits under federal and state laws. The drivers contended that they were engaged in interstate commerce because they transport passengers to and from an airport.
The Supreme Court’s decision to not hear the case came after the U.S. Court of Appeals for the 9th Circuit in December 2023 vacated its prior ruling, reinstating Uber’s lawsuit challenging a California law that mandates that the company classify its workers as employees instead of independent contractors.
A panel of 11 circuit court judges will rehear the company’s application to reverse a lower court’s dismissal of the legal challenge.
The Decision
The decision to deny the petition for certiorari, or review, in Singh v. Uber Technologies Inc., came on Jan. 8 in an unsigned order. No justices dissented. The court didn’t explain its decision. A minimum of four of the nine justices must vote to grant a petition for it to move forward to the oral argument stage.
“Millions of Americans work as rideshare drivers for Uber and Lyft, which classify them as independent contractors not covered by various employee-protection laws,“ the petition reads. ”Many more Americans work as transportation workers, such as last-mile delivery drivers, directly involved in the movement of goods or passengers across state lines albeit via short, local trips.
“When these drivers seek legal relief for alleged employment law violations, their putative employers seek to enforce arbitration contracts pursuant to the FAA.”
The 3rd Circuit’s opinion was written by Senior Judge Anthony Scirica, who was appointed in 1987 by President Ronald Reagan. Concurring in the opinion were Judge Kent Jordan, who was appointed in 2006 by President George W. Bush, and Senior Judge Marjorie Rendell, who was appointed to the court by President Bill Clinton in 1997.
The April 2023 ruling upheld a federal district court’s 2021 decision referring the drivers’ lawsuit to arbitration.
“The Federal Arbitration Act ... compels federal courts to enforce a wide range of arbitration agreements. But it does not apply to arbitration agreements contained in the ‘contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce,” Judge Scirica wrote.
“These consolidated appeals ask us to decide whether Uber drivers belong to such a class of workers. We conclude, as have our sister circuits, that they do not.
“The work of Uber drivers is centered on local transportation. Most Uber drivers have never made a single interstate trip. When Uber drivers do cross state lines, they do so only incidentally, as part of Uber’s fundamentally local transportation business.
“As a result, they are not ‘engaged in foreign or interstate commerce’ for the purposes of [Section] 1 of the FAA.”
Like the 3rd Circuit, various federal courts of appeal have held that drivers for ride-hailing services aren’t participating in interstate commerce.
The drivers in the lawsuit said they made 141.5 million interstate trips from 2010 through May 2020.
But the circuit court held that the quantity of interstate trips didn’t “shed much light on Uber drivers’ typical duties.”
“A high number of interstate trips does not mean that a class of workers is engaged in interstate commerce for purposes of [Section] 1 if a small proportion of the class is responsible for most of the trips,” the judge wrote.
“Rather, to be central to a class of workers’ job description, engagement with interstate commerce must be typical of the work that class members generally do.”
Evidence was presented indicating that “even among the most active Uber drivers, a majority—nearly 65 percent—have never made a single interstate trip.”
“On such evidence, it is easy to conclude that interstate trips are not a typical feature of class members’ work,” the judge wrote.
In 2022, the Supreme Court held in Southwest Airlines Co. v. Saxon that cargo loaders for airplanes are a “class of workers engaged in foreign or interstate commerce” and are therefore allowed to opt out of arbitration. The occasional border crossing isn’t enough to make interstate transportation a central component of an employee’s job, according to the court.
Founded in 2009, Uber took several years to rise to its current prominence.
The Epoch Times reached out for comment to representatives for Uber and Mr. Singh’s attorney, Matthew D. Miller of Swartz Swidler in Haddonfield, New Jersey, but hadn’t received any replies as of press time.
