Food delivery drivers in New York City have claimed that low tips and a lack of transparency from food delivery apps has led them to make reckless decisions on Big Apple roads, during a heated hearing at the City Council. During the three-hour hearing, representatives from Doordash, UberEats, and Grubhub were questioned by the Consumer and Worker Protections committee. The committee introduced seven bills aimed at addressing delivery safety and payment issues, including concerns over gratuity and paycheck breakdowns for workers.
Doordash and UberEaters altered their tipping prompts for customers after minimum wage laws for delivery workers were nearly tripled last year. Now, customers can leave a tip after placing their order, which has resulted in delivery workers losing $85 million in gratuities, according to City Council member Shaun Abreu. Abreu proposed legislation that would force the apps to move the prompt back to when the order is placed. He also criticized how the apps disclose information about their pay rates.
Council member Oswald Feliz introduced a proposal requiring delivery companies to provide free bikes to workers and ensure they meet safety standards. If passed, New York would be the only city to implement such a law. Another bill would require the app companies to ensure mopeds are registered. GrubHub representatives pushed back on this proposal, arguing that the company cannot enforce proper registration and licensing of mopeds.
The new minimum wage law allows the app companies to pay delivery drivers a flat $29.93 per hour rate instead of covering their idle time or paying a set $17.96 an hour minimum wage. The delivery companies have threatened to eliminate tipping entirely if the proposals are enacted. A spokesperson for Uber Eats stated that customers left $25 million in tips this year and argued that the Council should focus on better pay and protections for delivery workers.
The app companies did support a proposed bill aimed at loosening a fee cap implemented during the pandemic to help struggling restaurants. New York is currently the only city with restrictions on how much the delivery companies can charge restaurants, according to experts. The companies are also suing the Big Apple over the fee cap, and City Council member Rafael Salamanca suggested that this could cost the city $1 billion in damages if they lose the case.
Salamanca introduced a proposal that would loosen the fee cap, allowing the app companies to charge restaurants up to 25% for marketing fees from the current 5% cap on marketing. The NYS Latino Restaurant Association and other groups support the change to the rule, while the NYC Hospitality Alliance criticized it as the “Bigger Fees for Big Delivery Bill.
