Currently, app companies compensate their drivers per delivery rather than per hour. However, the New York City Department of Consumer and Worker Protection claims that this payment structure results in an average hourly pay of $7.09 before tips. Last month, the agency announced a new minimum wage rule that would gradually increase the pay for delivery workers to nearly $20 per hour by 2025.
In a joint lawsuit, DoorDash and Grubhub argue that the new rule is based on “inherently biased and unreliable survey data” and would ultimately harm delivery drivers instead of benefiting them.
The companies claim that if the rule is implemented, the increased costs would be passed on to consumers, resulting in a decrease in the number of customers for delivery workers and damaging their reputation within the industry.
In a separate lawsuit, Uber argues that the increased minimum wage would negatively impact local restaurants, as higher costs may discourage customers from ordering food delivery.
Delivery app makers have long fought against regulations in the industry. DoorDash and Grubhub claim in their lawsuit that the new rule is based on flawed data from a survey conducted with delivery workers, as the survey was designed to raise worker pay and allegedly provided suggested “correct” answers to respondents.
Ligia Guallpa, executive director of the Worker’s Justice Project, a labor advocacy group involved in the survey, criticized the lawsuits, stating that they prioritize business interests over the well-being of workers in a city facing an affordability crisis.
According to a spokesperson from Grubhub, the company has been working with the city for months to find ways to support its drivers, including exploring alternative pay methods. One concern raised by app makers is that the new rule would require them to track the time spent by riders on the app, not just during rides.
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