Uber, DoorDash Fail to Block NYC’s Minimum Wage Increase for App-Based Delivery Workers

Mimi Nguyen Ly
By Mimi Nguyen Ly
September 29, 2023Business News
Uber, DoorDash Fail to Block NYC’s Minimum Wage Increase for App-Based Delivery Workers
App-based delivery workers receive orders outside of a restaurant that uses app deliveries in New York City on July 7, 2023. (Spencer Platt/Getty Images)

A New York state judge has rejected attempts by Uber, DoorDash, and Grubhub to stop a minimum wage increase for app-based delivery workers.

The decision from New York Acting Supreme Court Justice Nicholas Moyne means that the law setting the minimum wage rise will take effect for the three companies.

The law, signed by New York City Mayor Eric Adams in June, requires that app-based delivery companies pay their workers a minimum of $17.96 an hour in 2023—a figure that will rise to nearly $20 in April 2025. It marks a big step up from the average $7.09 per hour that over 60,000 food delivery workers in New York City currently make.

Under the law, companies can choose to compensate workers hourly or per delivery, based on the hours the workers log into the app.

The law would have gone into effect on July 12, but Judge Moyne temporarily paused its implementation while reviewing the companies’ request to block the law. The judge’s decision Thursday now allows the minimum pay rate of $17.96 to take effect for Uber, DoorDash, and Grubhub.

The three companies, as well as a smaller delivery service called Relay Delivery, had argued that the New York City law would force them to reduce their service zones owing to the increased labor costs, impacting both customers and eateries.

DoorDash and Grubhub filed a joint lawsuit, while Uber, the parent company of Uber Eats, filed its lawsuit separately, as did New York-based Relay Delivery. The separate lawsuits were later consolidated.

But Judge Moyne on Thursday halted any enforcement of this law against Relay until the case’s resolution, noting that unlike the other companies, Relay couldn’t instantly up its charges to restaurants and needs time to renegotiate its contracts.

Adam Cohen, a lawyer for Relay, told Reuters via email that their couriers already earn over $30 an hour on average. “Today’s ruling further ensures beloved local restaurants … will continue to be able to rely on Relay to help them make ends meet,” Cohen commented.

NTD Photo
App-based delivery workers wait outside of a restaurant that uses app deliveries in New York City on July 7, 2023. (Spencer Platt/Getty Images)


Mr. Adams previously said the new requirement would provide the support that delivery drivers deserve. He praised the judge’s decision on Thursday.

“In rain, snow, sleet, hail, and heat, our delivery workers have consistently delivered for us—and now we can finally deliver for them,” Mr. Adams said in a statement. “We are grateful to the court for ruling in our favor, and to the deliveristas who have raised their voices in support of better pay and working conditions.”

Besides the mayor, other New York City officials also praised the judge’s decision.

Vilda Vera Mayuga, commissioner of the city’s Department of Consumer and Worker Protection, said in a statement on Thursday that New York City “has reaffirmed its commitment to ensuring restaurant delivery workers earn a dignified pay.”

“Delivery workers, like all workers, deserve fair pay for their labor and to be able to support themselves and their loved ones,” Ms. Mayuga added.

A DoorDash spokesperson said the judge’s decision was disappointing for workers, merchants, and customers. “The City’s insistence on forging ahead with such an extreme pay rate will reduce opportunity and increase costs for all New Yorkers,” the spokesperson said.

Representatives for Uber and Grubhub shared similar sentiments.

General minimum wage laws don’t apply for app-based food delivery workers, who are generally regarded and treated as independent contractors, rather than company employees.

New York City’s novel law was initially proposed in part because city delivery workers earn about $11 an hour post-expenses, which is below the city’s $15 minimum wage.

While Uber and others assert the city used flawed data to derive this minimum wage, Judge Moyne stated that the companies exaggerated the importance of those surveys in the city’s legislative process.

The companies also alleged that the city’s surveys of delivery workers were biased and were designed to elicit responses that would justify a minimum wage.

Judge Moyne also dismissed various other claims made by the companies against the law, including that the law was invalid because it covers workers who deliver food from restaurants but not from grocery and convenience stores.

From The Epoch Times

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