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On May 28, 2026, in Flowers Foods, Inc. v. Brock, the U.S. Supreme Court unanimously decided that workers who transport goods on an intrastate leg of an interstate journey may qualify for the Federal Arbitration Act (FAA) transportation worker exemption — even if they do not cross state lines or directly handle interstate vehicles. The decision represents the Court’s latest and most expansive interpretation of the FAA’s Section 1 exemption and continues its recent trend of broadening the category of workers who may avoid mandatory arbitration.
Background
Flowers Foods, a national baked goods company, distributes its products through independent distributors who deliver goods from local warehouses to retail locations. The plaintiff, a Colorado-based distributor, transported goods exclusively within the state, though those goods originated from out-of-state bakeries. After bringing wage-and-hour claims, the plaintiff resisted arbitration, arguing he fell within the FAA’s exemption for “workers engaged in interstate commerce.” Lower courts agreed, and the Supreme Court granted certiorari to resolve whether such “last-mile” drivers qualify for the exemption.
The Supreme Court’s Holding
The Court held that a worker may fall within the FAA’s Section 1 exemption where the worker transports goods on an intrastate basis, but as part of a continuous interstate journey and plays a role in that journey, even if the worker’s own duties are limited to intrastate transportation. Rejecting the employer’s proposed bright-line rule — that an employee who never crosses state lines or never interacts with vehicles that do cannot be subject to the exemption — the Court concluded that neither crossing state lines nor interacting with interstate vehicles is required.
Practical Implications for Employers
The decision increases the risk that arbitration agreements will be unenforceable under the FAA for workers involved in the movement of goods across supply chains. Employers utilizing last-mile delivery models face heightened exposure to litigation in court rather than arbitration. The decision may also complicate arbitration enforcement for independent contractors performing transportation-related functions. In addition, by removing FAA coverage, the ruling may facilitate class and collective wage-and-hour claims for affected workers.
Open Questions
Despite its broad holding, the decision leaves several issues unresolved, including the outer boundary of what constitutes a continuous interstate journey, whether workers further removed from delivery (such as those in warehouse or logistics support roles) qualify, and the extent to which state-law arbitration regimes may still enforce agreements where the FAA does not apply.
Conclusion
Flowers Foods Inc. v. Brock marks a notable development in arbitration law and employment litigation. By reaffirming and expanding the FAA’s transportation worker exemption, the Supreme Court has continued to narrow the scope of enforceable arbitration agreements for a growing category of workers involved in modern supply chains. Employers may wish to reassess their arbitration programs — particularly for delivery, logistics, and distribution roles — to evaluate exposure and consider alternative dispute resolution strategies.
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