Intra-State Truck Driver Need Not Arbitrate Unpaid Wage Claim

Intra-State Truck Driver Need Not Arbitrate Unpaid Wage Claim

On May 1, 2019, a California court of appeal in Muller v. Roy Miller Freight Lines, LLC affirmed  a trial court’s order denying an employer’s petition to compel arbitration of a truck driver’s class action claim for unpaid wages, despite him agreeing in a signed contract to “utilize binding arbitration to resolve all disputes that may arise out of the employment context.” The employer relied on the Federal Arbitration Act that “mandates arbitration when contracts involving interstate commerce contain arbitration provisions,” but the employee argued that he was a “transportation worker” and therefore he came within with the Section 1 exemption to FAA coverage.

The Muller court noted that even though the plaintiff never transported freight across state lines, his employer was in the transportation industry and 99% of the goods he transported originated outside California. Accordingly, the Muller court held that the plaintiff came within the limited exemption to FAA coverage, and that the court’s analysis was therefore governed exclusively by California law, including Labor Code section 229 that “authorized lawsuits for unpaid wages notwithstanding an agreement to arbitrate.”