A New York judge has ruled in favor of implementing a minimum pay rate of $18 per hour for food delivery workers in New York City, dealing a blow to companies like Uber, DoorDash, and Grubhub. The delivery apps had previously sued the city to block the standard, but the judge’s ruling allows for the minimum pay rate to be enforced. The rate will increase to $19.96 per hour in 2024 to account for inflation. The ruling has been hailed as a victory for worker rights, with advocates stating that it prevents multi-billion dollar companies from profiting off the labor of immigrant workers.
Delivery workers in New York City are considered independent contractors and do not currently benefit from employee protections like a minimum wage guarantee, workers’ compensation, or paid sick leave. The three delivery apps argued that a higher wage mandate would negatively impact consumers, leading to price hikes. They also contended that tracking time spent on the apps without making deliveries would be burdensome for delivery workers. However, the judge’s ruling supports the implementation of the minimum pay rate, emphasizing the rights of workers over the potential disruptions to the industry.
Companies using delivery workers in NYC will have the option to choose between two minimum pay rate options outlined by the city. The first option requires companies to pay workers at least $17.96 per hour for time spent connected to the app, including wait times. The second option involves paying $0.50 per minute of active time, excluding trips. Uber, DoorDash, and Grubhub have yet to specify which payment method they will follow, but the $0.50 per active minute option is already used by these companies in many locations. Smaller delivery platform Relay, which operates as a courier service for restaurants, also sued the city but was granted an injunction, allowing it to continue its operations with its unique business model.