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Delivery Apps Ask NYC to Block Wage Increase For Delivery Workers Days Before It Takes Effect

During a hearing Friday, DoorDash relied on the same tactics it’s used to push anti-worker legislation in California and elsewhere.

6:00 PM EST on December 16, 2022

(Robinson Greig / Unsplash)

Friday in New York City was a disgusting 42 degrees and raining, the kind of weather that blows up the phones of the city's tens of thousands of food delivery workers, whose livelihoods depend on ferrying meals across town for an average of $11.12/hour plus tips.

While many of those workers were out biking in the cold rain, delivery app companies staged a last-ditch effort on Friday to forestall implementation of a law that would raise the wages of these workers, starting next year. 

The local law, passed by the City Council in 2021, would increase the starting hourly wage for a delivery worker to $17.87 on January 1, 2023, with incremental increases until it tops out at $23.82 an hour in 2025. On Friday, the  Department of Consumer and Worker Protection held a final hearing on the proposed rule that would put the pay raises into effect. 

The pay raise has been cheered by many delivery workers, but the app companies themselves—UberEats, DoorDash, Grubhub, and Relay, which handle 99 percent of restaurant deliveries in the city between them—remain staunchly opposed. They believe that costs for consumers would need to rise to offset the higher wages. 

"Increased fees to offset costs would lead to a drastic decline in delivery orders, resulting in $87 million dollars lost for New York City businesses and restaurants alone," Sascha Owen, the head of government affairs for DoorDash in New York, told members of the DCWP, who are charged with implementing the rule.

In addition to hurting the businesses' bottom line, Owen, the former chief of staff for New York City Comptroller Scott Stringer, argued that the rule would hamper the flexibility that delivery workers currently enjoy to reject or accept certain jobs, and use their time trolling multiple apps for deliveries.

"Our primary concern is the proposed rule requires platforms to pay for all time that the app is open, rather than just the time that a worker is completing a delivery,” Owen said. "This represents a complete misunderstanding of our model and what workers are doing during this online time."

These talking points were echoed by a handful part-time delivery workers who testified at the hearing against increasing their own wages, at least some of whom, Hell Gate confirmed, had been coached by DoorDash.

"It’s not really our full-time job," said Luis Perez, a DoorDasher who said he also works a nine-to-five job, and feared loss of income from lower delivery demand. "It can help in a jam, some unexpected bills. I have concerns that what the city is doing would make it so I could no longer rely on the apps to make money in a way that works for me."

Notably, each of the delivery drivers who spoke out against the increase delivered their remarks in English. Delivery workers who spoke out in favor of the wage increase did so in Spanish. According to a recent DCWP study, 91 percent are non-white and/or Hispanic.

"We ride in the rain, in the snow," Otoniel Timoteo, a delivery cyclist, said in Spanish. Timoteo, who urged the DCWP to leave the wage increase alone, described instances where he had to spend uncompensated time fixing his bike to make deliveries. He said he felt that the companies weren’t listening to their drivers—just using them. 

DCWP’s study found that workers spent 39 percent of their time on the apps, "on-call," waiting for a delivery—akin to a wage-paid pizza delivery driver folding boxes, waiting for a call to come in. The study explained that "the high availability of workers helps the apps provide short delivery windows to consumers," meaning that by having the delivery workers stand by, the companies are making money. And it found that the vast majority of deliveries are made by delivery workers on bikes—"non-car modes of transportation account for 56 percent of workers but 69 percent of hours worked and 78 percent of deliveries."

Under the new rule, delivery apps would have to comply with the city’s wage floors for drivers, and closely monitor the time that each driver spends on their apps to calculate how much they should pay them. The apps will presumably try to pass these costs on to restaurants or consumers.

Over twenty people spoke at the hearing, including the city’s Comptroller, Brad Lander, who authored the wage bill while in the city council, and Brooklyn Borough President Antonio Reynoso. They both argued in favor of the wage hike, which also has the blessing of Mayor Eric Adams. 

As the hearing was underway, Los Deliveristas Unidos, a group that organizes on behalf of delivery workers instrumental in getting the pay raise law passed, rallied outside City Hall, urging the city to move ahead with its pay increase. 

Third-party apps have already secured one big victory this week, after Uber successfully sued to put a hold on a planned pay increase that was set to take effect on Monday

Pitting actual full-time workers against part-time workers has been a tried-and-true method for gig apps across the country, with the most striking success in California, when voters passed Proposition 22 in 2020, which cemented workers' part-time, non-employee status. 

As they’ve tried to achieve market domination, delivery apps have been able to attract customers by artificially deflating the cost of delivery and food, all supported by the venture capital that funds their businesses. Eventually, once they’ve dispatched their competitors, those businesses could then begin to jack their prices back up, and eventually make a profit. Paying delivery workers scrambles the plan—prices would have to go up well before the companies would have achieved wholesale market domination, meaning that they’d have to settle for competing against the idea of someone not paying extra fees and instead walking to a store or restaurant. 

This, in turn, might ultimately cut down on the amount of deliveries being made each day—while at the same time, making it a better living for the vast majority of delivery drivers, who now do the work full-time. 

But when you're asking for someone to get on a bicycle in New York City traffic in the cold December rain and bring you your dinner, $23.82 an hour sounds about right.

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