Federal Judge Grants Stay in Amazon Delivery Driver Suit Pending SCOTUS Arbitration Decision

May 25, 2022
Hall Benefits Law, LLC

A judge for the U.S. District Court for the Western District of Washington has granted Amazon.com, Inc.’s motion to stay a lawsuit alleging that the company wrongfully withheld tips from contract delivery drivers.

The court determined that a decision in Southwest Airlines Co. v. Saxon, a pending case before the U.S. Supreme Court concerning exemptions under the Federal Arbitration Act, impacts a serious legal question in the Amazon case. If forced to move forward with the litigation, the judge reasoned, Amazon could suffer irreparable harm, depending on the outcome of the Saxon appeal. The judge further found that granting the stay would cause no public harm, as the tip withholding practices at Amazon ended in 2019.

A group of individuals whom Amazon hired as Flex drivers to deliver packages in their personal vehicles, filed suit against Amazon in 2019. They claimed that Amazon kept tips that customers gave to them through the Flex service.

Amazon filed a motion to compel arbitration, arguing that the court should dismiss the lawsuit because the workers were subject to an arbitration agreement. Meanwhile, the U.S. Court of Appeals for the 9th Circuit ruled in Amazon v. Rittmann that Flex drivers were exempt from the arbitration agreement since they qualified as transportation workers under the Federal Arbitration Act. In reliance on that decision, the Washington District Court denied Amazon’s motion to compel arbitration in December 2021.

Amazon then moved for a stay in this case and two other similar cases based on the Saxon case pending before the Supreme Court. In that case, Southwest Airlines is arguing that the Federal Arbitration Act does not exempt a certain class of airline workers as transportation workers because they do not cross state lines. Since the Saxon case addresses a legal question relevant to Miller v. Amazon.com Inc et al., case number 2:21-cv-00204, the Washington judge chose to stay the case pending the high Court’s decision.

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Hall Benefits Law, LLC

HBL offers employers comprehensive legal guidance on benefits in mergers and acquisitions, Employee Stock Ownership Plans (ESOPs), executive compensation, health and welfare benefits, healthcare reform, and retirement plans. We counsel a wide spectrum of clients including small, mid-sized, and large companies, 401(k) investment advisors, health insurance brokers, accountants, attorneys, and HR consultants, just to name a few. HBL is passionate about advising clients, and we are dedicated to our mission: to provide comprehensive, personalized, and practical ERISA and benefits legal solutions that exceed client expectations.