Harlay Tree

Ninth Circuit Court of Appeals says plane techs are not bound by the Federal Arbitration Act.

On July 19 the Ninth Circuit issued a decision in Lopez v. Aircraft Servs. Int’l finding fuel technicians who work on airplanes that fly in interstate commerce are not bound by the FAA, and therefore were not required to arbitrate their California wage claims against their employer.  The FAA, which mandates enforcement or private agreements to arbitrate legal disputes, does not apply to employees “engaged in foreign or interstate commerce.”  Although this exemption has been described as applying only to “transportation workers,” that includes any workers “directly involved in transporting goods across state or international borders.” The court held that this, in turn, includes anyone whose work is “so closely related to interstate and foreign commerce as to be in practical effect part of it.”  This drastically impacts the landscape of use of arbitration clauses in employment contracts in many different industries—something employers need to be aware of. 

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