NFIB has submitted an amicus brief to the United States Supreme Court in the case Flowers Foods, Inc., et al. v. Angelo Brock. The central issue is the interpretation of the Residual Clause Exemption under Section 1 of the Federal Arbitration Act (FAA) and whether certain workers are exempt from arbitration agreements.
Beth Milito, Vice President and Executive Director of NFIB’s Small Business Legal Center, commented on the significance of arbitration for small businesses. “Small businesses rely on arbitration agreements as an alternative to the costly, time-consuming legal process,” said Milito. “If this new interpretation is upheld, thousands of small business owners could be taken to court while the legal system redefines this long-upheld standard one case at a time. Meanwhile, small businesses everywhere will be caught in the crosshairs.”
The amicus brief argues that the FAA's Residual Clause Exemption should apply only to workers directly involved in transporting goods across state or international borders and that expanding this exemption would create confusion, increase court burdens, and negatively impact both businesses and employees.
NFIB filed this brief alongside several other business organizations: the U.S. Chamber of Commerce, Retail Litigation Center, National Retail Federation, National Association of Wholesaler-Distributors, and National Association of Manufacturers.
NFIB’s Small Business Legal Center is active in more than 40 cases at various levels of federal and state courts throughout the country, including matters before the U.S. Supreme Court.
