The big three restaurant delivery apps — DoorDash, Grubhub, and Uber — are suing New York City over the city’s new minimum wage law passed last month, which nearly triples the delivery worker minimum wage from $7.09 to $19.96 per hour, once the law is fully phased in in 2025.
DoorDash and Grubhub filed their lawsuit jointly with the New York State Supreme Court, while Uber filed its lawsuit separately in the same court.
Overview of the Lawsuit – Implications of the Contracted Worker Protection Law
The contracted worker protection law is the first of its kind nationally and gives third-party delivery apps the choice of paying delivery drivers per trip, per hour, or via their own formula.
However, if delivery companies choose to pay workers via trip time, they would have to pay 55 cents per minute, which adds up to $33 per hour, more than double the city’s current minimum wage rate.
Response from Restaurant Delivery Apps
Likely at least partially in response to these changes, DoorDash recently announced two new ways for contracted delivery workers to earn money: by time (via a guaranteed minimum hourly rate) or by individual offer, which is the original earning mode that DoorDash had already been using to pay its Dashers.
DoorDash is also arguing that a New York City Department of Consumer and Worker Protection survey which preceded the creation of the new rule was flawed, alleging that the DCWP is inflating pay standards by requiring delivery apps to pay delivery workers for time spent not working.
The lawsuit also argues that by excluding grocery delivery workers from the new law, the rule is unfairly targeting third-party restaurant delivery apps.
Looking Ahead
The Contractor Worker Protection Law has major implications for restaurant delivery apps operating in New York. This law grants contracted workers protections such as the right to a minimum wage, the right to overtime pay, and the right to receive compensation for their work-related expenses.
In addition, it provides workers with protection from discrimination and retaliation by their employers. As part of the law, restaurant delivery apps must ensure that these protections are given to contracted workers. This means that restaurants will need to have policies in place for contract worker compensation and benefits, as well as procedures for dealing with discrimination or retaliation issues.
Furthermore, they must make sure their contracted workers are provided with a safe working environment and access to necessary resources such as protective gear and hazard pay.
The Contractor Worker Protection Law is a significant change for New York’s restaurant delivery apps, and businesses must be aware of their legal responsibilities in order to remain compliant. With an increased focus on worker safety and rights, the law ensures that contracted workers are treated fairly and equitably.
By following the rules set forth by the law, restaurants can ensure that their contracted workers are protected and that their businesses remain successful.
