A package of legislation from the City Council will set minimum pay and working conditions, placing New York at the forefront of regulating a multibillion-dollar industry.
The New York City Council is on track to pass a groundbreaking package of legislation on Thursday that will set minimum pay and improve working conditions for couriers employed by app-based food delivery services like Grubhub, DoorDash and Uber Eats.
The bills, which have the support of Mayor Bill de Blasio, are the latest and most broad example of the city’s continuing effort to regulate the multimillion dollar industry. While other cities have taken steps to restrict the food delivery apps, no city has gone as far as New York, which is home to the largest and most competitive food delivery market in the country.
The legislation would prevent the food delivery apps and courier services from charging workers fees to receive their pay; make the apps disclose their gratuity policies; prohibit food delivery apps from charging delivery workers for insulated food bags, which can cost up to $50; and require restaurant owners to make bathrooms available to delivery workers.
Delivery workers would also be able to set parameters on the trips they take without fear of retribution. Workers — who have been targeted by robbers intent on stealing their money or their e-bikes — would be able to determine the maximum distance they want to travel from a restaurant or specify that they are not willing to go over bridges to make a delivery, for example.
“These workers sacrificed their own safety during the pandemic to bring food to our homes, yet in some cases they were denied bathroom access at restaurants and charged fees by third-party apps,” Corey Johnson, the City Council speaker, said in a statement. “I’m proud of New York City and this Council for standing up for these workers, and I urge other major cities to protect this industry.”
Working conditions for the roughly 80,000 delivery workers in New York came into renewed focus three weeks ago, when the remnants of Hurricane Ida hit the city, and scenes of food delivery workers traversing flooded streets to deliver meals stirred outrage.
The use of food delivery apps soared as the coronavirus pandemic shuttered the dining rooms of restaurants around the city. But for the mostly immigrant laborers tasked with delivering the meals, working conditions were as difficult as ever.
José Ramirez, who came to New York from Puebla, Mexico, has worked as a delivery worker in Manhattan for four years. He said he earns about $8 an hour before tips, which has required him to work more than 10 hours a day on most days to earn enough money to support himself.
Mr. Ramirez, a member of Los Deliveristas Unidos, a group that has been fighting for years for delivery worker protections, said restaurants have denied him bathroom access so frequently that he has resorted to calling his friends during his shift to use their bathrooms.
“People sometimes come up to me after I make their delivery and tell me they’re sorry they can’t tip me,” Mr. Ramirez said. “I feel happy I helped, but I’m not getting paid. I have to pay for my bike, my delivery backpack and my cellphone, so we need a dignified minimum pay.”
The legislation appears to be the first of its kind in the country.
As demand for deliveries has soared, workers at food delivery start-ups across the country have been organizing efforts to demand better pay and conditions. Some cities in California and Washington state passed temporary measures to provide hazard pay for delivery and other essential workers because of the pandemic.
States like California and Massachusetts have also been engaged in protracted legal battles over which rights and protections should be given to gig workers.
Last year, California voters overwhelmingly approved Proposition 22, a victory for companies like Uber and DoorDash that allowed them to continue treating drivers as independent contractors. The measure exempted the companies from a state labor law that would have forced them to employ drivers and pay for their health care and other benefits. As a concession to labor advocates, the initiative offered a wage floor and limited benefits to drivers.
But last month, after a lawsuit by a group of drivers and the Service Employees International Union, a California judge found the proposition unconstitutional and unenforceable. The companies have said they will appeal.
Chicago recently sued the food delivery apps, charging that they engage in deceptive practices. San Francisco, meanwhile, voted to place a permanent 15 percent cap on fees the apps charge restaurants, but Mayor London Breed has not signed the law, saying it “oversteps what is necessary for the public good.”
New York City is currently facing two lawsuits from the largest food delivery companies in the industry, which are seeking to eliminate rules that regulate how much the apps can charge restaurants and the information they must disclose.
Grubhub, DoorDash and Uber Eats filed a lawsuit in Federal District Court in Manhattan earlier this month arguing that a 15 percent cap on fees for online orders and 5 percent cap per order for other fees such as marketing was unconstitutional and would ultimately lead to higher prices for consumers and less profits for restaurants.
Restaurant owners say the companies sometimes charge them fees of up to 30 percent per order, which affects their already slim profit margins. But because the apps have come to dominate the food delivery market, the owners have said they have no choice but to list their restaurants on them.
DoorDash filed a separate lawsuit last week contesting another law passed by the City Council that would require the apps to share customer data such as their names, addresses, emails and telephone numbers with restaurants.
Although the new package of bills may also face court challenges, Grubhub officials said they supported the legislation.
“These bills are common-sense steps to support the delivery workers who work hard every day for New York’s restaurants and residents,” Grant Klinzman, a spokesman for Grubhub, said in a statement. “Ensuring they receive a living wage and have access to restrooms isn’t just a good idea, it’s the right thing to do.”
Carlina Rivera, a councilwoman from Manhattan who sponsored the bathroom legislation, said she had heard stories from workers who had to wait hours to find a restroom they could use and from other workers who were asked to pay to use the bathroom at a restaurant.
“These are workers that have been disenfranchised for a long time. They come from historically marginalized and low-income areas of our city,” Ms. Rivera said. “It took a national and global pandemic and waist-deep floodwaters to bring attention to their plight.”
The legislation calls for the city to conduct a study to determine how much delivery workers should be paid. Currently, the workers’ pay is determined by whether they are working during peak hours, the amount of time in between trips, and the neighborhood where food is being picked up and delivered.
Delivery apps that violated the new rules would face fines and could have their licenses to operate in the city suspended.
But even under the rules, the workers would still be classified as independent contractors who are ineligible for workers’ compensation or unemployment benefits.
Hildalyn Colon, director of policy for Los Deliveristas Unidos, said the need to pass the bills became more urgent as the food delivery industry became a source of income for more workers, many of them immigrants who begin working just weeks after arriving in the country.
Manny Ramirez, 34, and his wife both work as delivery workers. He said there has been a longstanding, pressing need to improve working conditions.
“These bills are already affecting us and changing our lives, because these issues have come to the surface,” Mr. Ramirez said in Spanish. “This is just the beginning of things that are going to come.”
Reporting was contributed by Nicole Hong, Coral Murphy Marcos and Ashley Wong.
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