California court rules intrastate trucker exempt from arbitration act

By Mark Schremmer, Land Line associate editor | 5/6/2019

A California appeals court affirmed that a truck driver for Roy Miller Freight Lines LLC was exempt from the Federal Arbitration Act even though he drove intrastate.

California’s Fourth Appellate District Court on Wednesday, May 1 ruled that the trial court correctly concluded that truck driver William Muller was exempt from the FAA in his lawsuit over unpaid wages.

“Even though Muller did not physically transport goods across state lines, his employer is in the transportation industry, and the vast majority of the goods he transported originated outside California,” the appeals court wrote.

Muller worked as a truck driver for Roy Miller Freight Lines, which is based out of Anaheim, Calif., for less than a year. At the trucking company’s request, Muller signed a two-page written agreement requiring him to “utilize binding arbitration to resolve all disputes that may arise out of the employment context.”

Muller’s employment with Roy Miller Freight Lines ended in September 2014. Two years later, he filed a putative class action complaint against the company, asserting causes of action for unpaid wages, unpaid rest breaks, incomplete wage statements, missed meal periods, waiting time penalties, and unfair competition.

The company moved to compel individual arbitration.

The FAA provides a limited exemption to “contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.”

Roy Miller Freight Lines argued that Muller never crossed state lines to make his deliveries and was not engaged in interstate commerce.

The court, however, ruled that Muller was still a transportation worker and should be exempt.

“The intrastate nature of Muller’s work should not be viewed in a vacuum,” the appeals court wrote. “The various other circumstances of Muller’s employment – especially that his employer is in the transportation industry and over 99 percent of the goods he transported originated outside California – collectively weigh in favor of him being a transportation worker.”

Because the FAA is inapplicable, the court said, the decision must be guided by California law, which authorizes lawsuits for unpaid wages even if the parties agreed to arbitration.

 

 

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