{"id":7047362,"date":"2026-08-25T13:43:59","date_gmt":"2026-08-25T13:43:59","guid":{"rendered":"https:\/\/peraltafinancing.com\/business\/legal\/how-the-flowers-foods-supreme-court-decision-affects-independent-contractor-agreements-who-is-my-employee\/"},"modified":"2026-08-25T13:43:59","modified_gmt":"2026-08-25T13:43:59","slug":"how-the-flowers-foods-supreme-court-decision-affects-independent-contractor-agreements-who-is-my-employee","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=7047362","title":{"rendered":"How the Flowers Foods Supreme Court Decision Affects Independent Contractor Agreements \u2013 Who Is My Employee?"},"content":{"rendered":"


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A dog in Nebraska shot a woman<\/a> in the arm last month in a convenience store parking lot. <\/p>\n

Police were called to the scene after a shotgun blast from a parked truck struck a woman walking by. The culprit turned out to be a dog, who triggered the blast when moving around in the truck. There was a loaded shotgun in the truck, and the dog had not been properly trained in the responsible use of firearms.<\/p>\n

The woman was not seriously injured. It is unknown whether the dog expressed remorse or is otherwise a very good boy.<\/p>\n

The lesson here, of course, is to think ahead. And that applies both to firearm-loving dog owners and to businesses using independent contractors.<\/p>\n

On May 28, the Supreme Court issued an opinion clarifying the scope of the transportation exception to the Federal Arbitration Act (FAA). The FAA does not apply to transportation workers engaged in interstate commerce. In Flowers Foods v. Brock<\/a>, the Court held that a driver may fall within the exception even if he does not cross state lines or interact with a vehicle that does. So long as the driver\u2019s task is in the flow of interstate transportation of goods, then the worker could fall within the exemption, which means the FAA would not apply and the worker might be able to sidestep an otherwise-valid arbitration agreement.<\/p>\n

A previous Supreme Court decision held that the transportation worker exception can apply to independent contractors.<\/p>\n

So where does this leave businesses that enter into arbitration agreements with independent contractors who transport their goods?<\/p>\n

There are several unresolved legal questions, but as things stand now, businesses should strive to enter into business-to-business agreements. They should contract with entities to transport goods, not individuals. If the entity is a small entity, such as a single member LLC, the agreement should contain clauses that place full responsibility for directing and controlling the work on the small entity. Even if the larger business directs the small entity, any direction to the individual worker should come from the small entity to its worker.<\/p>\n

The Supreme Court has not yet addressed whether the transportation exception would apply in this situation, but this seems to be the best approach for now. (Even if the FAA doesn\u2019t apply, state arbitration law might still be sufficient to save the arbitration agreement.)<\/p>\n

Businesses who engage independent contractors to transport goods should be extra vigilant in ensuring that all business contracts are with entities, not individual independent contractors, if they want their arbitration agreements to have a reasonable shot at being enforceable.<\/p>\n

It\u2019s easy when engaging an independent contractor to assume that both parties are happy with independent contractor status, as opposed to employment, but misclassification lawsuits tend to arise when the relationship goes south, not when everyone is happily engaged. One of the main benefits of having a well-written independent contractor agreement is to address what happens if there are disagreements later, including unforeseen disputes. <\/p>\n

When the parties want those disputes to be resolved through arbitration, they need to draft the agreement in a way that it will be enforceable. For contracts that involve transportation of goods, the FAA transportation exception must be taken into consideration when drafting.<\/p>\n

Advanced preparation when entering into the contract is critical to protecting the right to arbitrate later. It\u2019s all about looking ahead and being prepared. Come to think of it, advanced preparation and thinking ahead are valuable in just about any context \u2014 including when leaving a dog alone with a shotgun.<\/p>\n

\u00a9 2026 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.<\/em><\/p>\n

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