Southwest Airlines Co. v. Saxon

Latrice Saxon, a ramp supervisor for Southwest Airlines at Chicago Midway Airport, filed a class-action lawsuit alleging the airline failed to pay proper overtime wages under the Fair Labor Standards Act. Southwest sought to compel individual arbitration based on her employment contract. Saxon argued she was exempt from the Federal Arbitration Act as a “transportation worker” engaged in interstate commerce. The district court denied arbitration, and the Seventh Circuit affirmed. The U.S. Supreme Court granted certiorari and unanimously held that airline cargo loaders who physically handle goods moving in interstate commerce are transportation workers, regardless of whether they directly cross state lines, and thus fall within the FAA’s exemption.

The Supreme Court issued an 8-0 decision in favor of Saxon, ruling that she is a transportation worker engaged in interstate commerce and therefore not subject to forced arbitration under the Federal Arbitration Act. The judgment of the Seventh Circuit was affirmed.

Whether an airline ramp supervisor who loads and unloads cargo from planes that travel across state lines qualifies as a “transportation worker” exempt from the Federal Arbitration Act, even if the worker herself does not physically cross state lines.

The ruling significantly narrows the ability of airlines and other transportation companies to enforce mandatory arbitration clauses against baggage handlers, cargo loaders, and similar logistics workers. It strengthens the legal position of transportation employees to pursue collective action lawsuits in federal court over wage and hour violations.