QUESTION SET THREE Vegan Bread & More (VBM), founded in Brooklyn, New York, made its mark as a local vegan bakery. But thanks to a cash infusion from keen investors, it's now a national operation, shipping a wide variety of products all over the US from its Spartanburg County, South Carolina facility, which employs 500 people. When VBM first set up the South Carolina operation, it simply hired the truck drivers it needed at that time. A couple of years ago, though, it decided to get out of the employer role. To accomplish that goal, it entered into a contract with a regional staffing agency, Carolina Alternative Staffing (CAS). Pursuant to that contract, VBM terminated all of its drivers; CAS hired them and then assigned the drivers to VBM, where they continued to perform the same work they had been doing. To VBM's delight, the transition was seamless. Per the contract, CAS is the employer of record and handles all payroll and employment related reporting and paperwork. VBM sets each driver's hours and routes, provides training, and closely supervises their work.

This year, VBM is experimenting with another staffing model. Inspired by Uberst and Lyftty, it's now a party to half a dozen independent contractor driver agreements. Under the terms of those agreements, those drivers aren't employees of either VBM or CAS. The drivers are paid a monthly flat fee, a sum based on VBM's current monthly cost per driver, minus the fees paid to CAS. For operational reasons, the independent drivers drive VBM trucks and are supervised by VBM managers who assign their hours and routes. So far, this model has been a win-win. From VBM's point of view, the independent contractor format enables VBM to avoid all employer-related problems and liability as well as eliminate the fees it used to pay CAS.

To further insulate VBM from the risk of any big money judgements, the independent contractor agreements also contain mandatory arbitration clauses, which require that drivers waive the right to file any VBM work-related claim in any federal, state or local agency, or court. The agreements require that any and all VBM work-related claims be pursued via the VBM grievance and arbitration procedure, which is the sole, final, binding, and exclusive remedy for any and all work-related disputes. The agreement requires that all claims be filed in person in VBM's Brooklyn, New York business office within 24 hours of the alleged underlying incident, and that any claims not resolved in that office be submitted to an arbitrator designated by VBM.

Please analyze each legal issue presented by this fact pattern. Be sure to:

Identify each legal issue raised by the facts, and identify by name the laws that govern those issues. Identify and describe the rule/test that a court would apply to each issue. If there is a relevant case in the textbook, please identify it, and briefly state how the court applied the test or rule in that case. Then apply the rule or test to the facts in this question set as to each issue that you've identified. If additional information would be helpful to your analysis, identify that information and how it would impact your analysis.