Once again, a court has considered the criteria for the transportation worker exemption from the Federal Arbitration Act (FAA), 9 U.S.C. § 1. This time an account manager for ISS Facility Services Inc., Heidi Eastus, who oversaw ticketing and gate agents at George Bush Intercontinental Airport in Houston, Texas, maintained that she was exempt from the FAA as a transportation worker. Eastus was assigned to supervise ticketing and gate agents for Lufthansa German Airlines, which sometimes entailed handling passengers’ luggage herself. But the Fifth Circuit panel found the FAA exemption did not apply. See Eastus v. ISS Facility Services, Inc., Case No. 19-20258 (5th Cir. May 27, 2020).
Eastus filed employment discrimination and retaliation claims against ISS and two Lufthansa entities. The defendants moved to compel arbitration premised on the arbitration provision in Eastus’ ISS employment agreement. Eastus responded that arbitration could not be ordered because she was exempt from the FAA. The district court granted the motion to compel arbitration. We have repeatedly addressed the uncertainty surrounding the tests for application of the FAA exemption. See our April 29, 2019, Sept. 13, 2019 and April 3, 2020 blog posts. As reflected in the discussion below, application of the correct test may involve analysis of complex and differing legislation. The ongoing search for proper exemption criteria has caused consternation in gig economy companies and may only be intensified by claims arising from the COVID-19 pandemic in the transportation industry. Continue Reading