New York City Council held a hearing on June 21 to regulate the food delivery industry and related sectors, discussing multiple aspects of legislative proposals including “Intro. 762.” One of the contentious topics was whether to eliminate the clause limiting third-party delivery platforms’ fees on restaurants.
The hearing covered safety regulations for motorcycle delivery, requiring delivery platforms to display tip amounts online before or at the time of placing orders, removing restrictions on service charges imposed on food industry operators, and further transparency in the wage algorithm for delivery workers.
The New York City Hospitality Alliance, representing the interests of the food industry, urged the City Council to abandon the proposal to cancel the fee cap on third-party platforms charging restaurants. A representative of the alliance stated during the hearing that removing the fee cap would empower major delivery companies like DoorDash, Grubhub, and Uber to take nearly half of the profits from restaurant delivery orders, increasing the burden on New York City food industry operators and significantly impacting small businesses.
Councilman Rafael Salamanca introduced the legislative proposal “Intro. 762,” which maintains a 15% delivery fee cap and a 3% credit card handling fee cap to protect consumers. The bill, based on the previous version of Intro. 813, aims to allow restaurants to choose and supplement promotions more flexibly and ensure all restaurants are listed and discovered by consumers on third-party delivery platforms—crucial for small businesses competing with chain stores in New York.
Another proposed legislation, Intro. 738, would require tipping options to be displayed when the delivery person receives the order, rather than after the consumer receives the order, to prevent platforms from withholding tips from delivery workers and safeguard their income. Intro. 737 suggests setting the minimum tip amount at 10% of the total bill.
Although the minimum hourly wage for delivery workers on platforms was set at $19.56 per hour since last year, some workers have reported that their income has not increased accordingly due to increasingly strict work policies, such as “burying” tip options. In March this year, the platforms even required delivery workers to fill out a “schedule” to calculate hourly wages within reserved time slots.
Regarding this issue, Mr. Yan, a Chinese-American delivery worker who works part-time for both DoorDash and Uber Eats, mentioned in an interview with The Epoch Times that by accepting orders during scheduled time slots, platforms can save on wage payments. If the delivery worker remains online continuously but does not deliver during that time, platforms still have to pay wages based on time, resulting in losses for the platforms.
Regarding the current tipping issues on delivery platforms, he noted that when receiving orders from DoorDash, he can see the tip amount clearly displayed, while Uber Eats typically shows the tip amount only after completing an order. He believes that tips shown after completing the delivery task might be partially retained by the platform.