New York City triples pay rate for app-based food delivery workers

“Deliveristas” part of America’s culture, Adams says

I predict that the number of people ordering food deliveries will take an immediate hit. Only a small segment of the working people these days is able to withstand the current level of inflation and hardly anyone is saving anymore. Who do the leaders in NYC think will be able to afford a 300% increase in the price of food deliveries?

@opinionated4219

New York’s announcement that pay for food delivery app workers will more than triple could be both good news and bad, according to industry observers.

“If you want a human being to go to a restaurant for you, pick up your food, and then bring it to your doorstep, it’s going to be expensive,” notes Rideshare blogger Harry Campbell.

New York City Mayor Eric Adams and New York City Department of Consumer and Worker Protection (DCWP) Commissioner Vilda Vera Mayuga announced that the City of New York has set a first-of-its-kind minimum pay rate for app-based restaurant delivery workers. When fully implemented, the city’s more than 60,000 delivery workers — who currently earn $7.09/hour on average — will earn at least $19.96/hour. Restaurant delivery apps will also have flexibility in how they pay delivery workers the new minimum rate.

In Ontario, legislation from March 2022 promised delivery drivers minimum wage, but only calculated only minutes spent actively delivering orders. It does not take into consideration downtime spent between orders.

From New York’s press release:

“‘Getting Stuff Done’ for working people is what this administration is all about, and that includes some of the hardest working New Yorkers: our delivery workers,” said Mayor Adams. “Our delivery workers have consistently delivered for us — now, we are delivering for them. This new minimum pay rate, up by almost $13.00/hour, will guarantee these workers and their families can earn a living, access greater economic stability, and help keep our city’s legendary restaurant industry thriving.”

“Delivery workers have kept New Yorkers nourished through the most perilous of conditions, delivering food right to our doors throughout the pandemic and unprecedented weather conditions in the past,” said Deputy Mayor for Housing, Economic Development, and Workforce Maria Torres-Springer. “Thanks to the diligent work of the Adams administration and the Department of Consumer and Worker Protection, we are delivering on the mayor’s working people’s agenda and improving the lives and economic potential of more than 60,000 New Yorkers.”

“Today is a historic win for New York City’s delivery workers, who have done so much for all of us through rain, snow, and throughout the pandemic,” said DCWP Commissioner Mayuga. “When the rate takes full effect, workers will make three times as much as they do now. I am proud that our city has fulfilled its promise to provide more stability and protections for 60,000 workers and get them a dignified pay rate.”

“Today we’re celebrating another major victory in our fight to deliver justice for the city’s delivery workers: raising their minimum wage to at least $19.96/hour,” said U.S. Senate Majority Leader Charles Schumer. “Deliveristas are the American dream, working hard to deliver for themselves and their families. Thank you to Ligia Guallpa and Gustavo Ache from Deliveristas Unidos, Mayor Adams, DCWP Commissioner Mayuga, and other elected officials who helped in this fight to organize. Si se puede!”

DCWP closely considered all comments submitted during the public comment period and established a final rate that will greatly increase workers’ incomes, while also being responsive to industry and worker feedback. The final rate also takes into account that, as independent contractors, delivery workers pay out-of-pocket for their expenses and do not have access to workers’ compensation insurance, or paid time off, and must pay more in Medicare and Social Security contributions.

The pay rate will be $17.96 when it takes effect on July 12, 2023, and will increase to $19.96 when it is fully phased-in on April 1, 2025. The rate will also be adjusted annually for inflation. Apps have the option to pay delivery workers per trip, per hour worked, or develop their own formulas, as long as their workers make the minimum pay rate of $19.96, on average. Apps that pay workers for all the time a worker is connected to the app (the time waiting for trip offers and trip time) must pay at least $17.96 per hour in 2023, which is approximately $0.30 per minute, not including tips. Apps that only pay for trip time (the time from accepting a delivery offer to dropping off the delivery) must pay at least approximately $0.50 per minute of trip time in 2023, not including tips.

DCWP found that workers spend approximately 60 percent of their working time engaged in trips and 40 percent on-call. For example, on a given day, a worker may be on-call awaiting trip offers for four hours and making deliveries for six hours. If that worker’s app only pays for trip time, the worker would make $179.60 based on the trip time rate when the rate takes effect in 2023. If, instead, the worker’s app pays for both trip time and on-call time, the worker will still make $179.60. These per-minute rates are approximate. Apps would have to calculate exact pay in accordance with the rule.

In September 2021, the New York City Council passed Local Law 115, requiring DCWP to study the pay and working conditions of app-based restaurant delivery workers and to establish a minimum pay rate for their work based on the study results. DCWP published its study last year, which drew from data obtained from restaurant delivery apps, including DoorDash, GrubHub, UberEats, and Relay; surveys distributed to delivery workers and restaurants; testimony; extensive discussions with stakeholders on all sides; and publicly available data. Members of the public, delivery workers, and restaurant delivery apps submitted thousands of comments on the proposed minimum pay rule, which DCWP carefully considered in developing the final rule.

DCWP will be conducting worker outreach and education about the new minimum pay rate and all rights under the city’s delivery worker laws. Delivery workers, apps, restaurants, and consumers can visit DCWP’s website for information about the minimum pay rate, multilingual resources, and information about the city’s delivery worker laws. Workers can also call 311 and ask for “delivery worker” or visit DCWP’s worker page to request more information or to file a complaint.

This minimum pay rate is just one part of the city’s holistic approach to improving working conditions for delivery workers. Announced in 2022, the Adams administration is working with Los Deliveristas Unidos to convert vacant newsstands into hubs to provide a place for delivery workers to seek shelter from the elements, as well as charge electric bicycles and phones.

“The Deliveristas were our frontline heroes throughout the darkest days of the pandemic, and today, they continue to be the targets of street crimes and endure dangerous weather conditions to deliver millions of New Yorkers the food, supplies, and medicine we need,” said New York State Senator Jessica Ramos. “Like most New Yorkers, they are feeling the pressure of our affordability crisis, and it would be irresponsible to leave them reliant on tips alone to cover their bills. I’m relieved to see their minimum pay standards implemented, and want to congratulate these workers on this victory. It has come not a moment too soon.”

“Today, New York City takes a significant step forward in recognizing the essential contributions of our app-based restaurant delivery workers,” said New York State Senator Robert Jackson. “By establishing the nation’s first minimum pay rate for these hardworking individuals, we are ensuring that their dedication and tireless efforts are rewarded with fair compensation. This landmark initiative not only uplifts the livelihoods of over 60,000 delivery workers but also sets a powerful example for other cities to prioritize the well-being of gig economy workers.”

shocking news. If you want a human being to go to a restaurant for you, pick up your food, and then bring it to your doorstep, it’s going to be expensive. https://t.co/a6Hn5HWcez

— Harry Campbell 🇺🇸 (@TheRideshareGuy) June 14, 2023