The Supreme Court’s unanimous May 28, 2026, decision in Flowers Foods, Inc. v. Brock significantly broadens the Federal Arbitration Act’s Section 1 transportation-worker exemption by holding that workers performing exclusively intrastate deliveries as part of a larger interstate supply chain qualify as “engaged in interstate commerce” and are therefore exempt from compelled arbitration—even when they never cross state lines or interact with vehicles that do.

The ruling resolves a longstanding circuit split in favor of the “constituent part” framework and marks the court’s fourth consecutive rejection of efforts to narrow Section 1’s reach, confirming that any distribution model in which goods originate outside the state and are completed by local drivers now falls squarely within the zone of heightened exemption risk, while leaving unresolved critical questions about independent contractor status, title passage, and intended destination that will drive worker-by-worker litigation and require companies relying on arbitration agreements with transportation workers to conduct immediate legal assessments of their workforce structures.

Read the legal update here.