Food delivery app drivers to receive wage hike following latest appeal failure

Top Class Actions’s website and social media posts use affiliate links. If you make a purchase using such links, we may receive a commission, but it will not result in any additional charges to you. Please review our Affiliate Link Disclosure for more information.

Update:

• Uber, Grubhub and DoorDash must adhere to New York City’s new worker pay requirements after a New York appellate judge ended a stay on the new law.
• Workers are now required to be paid at least $17.96 per hour, a rate set to increase to $19.96 in 2025 and then increase based on inflation after that, according to New York’s Department of Consumer and Worker Protection (DCWP).
• Appellate Judge Llinét M. Rosado made the ruling after reading the filings from Uber, Grubhub and DoorDash, ending a stay on the wage requirements that began Sept. 28.
• The pay increase came from New York’s Local Law 115, which allowed the DCWP to study and determine an appropriate minimum wage for gig workers in the city. 

New York City food delivery minimum wage overview: 

• Who: New York City has set a new minimum wage for delivery workers who contract with companies such as GrubHub and DoorDash. 
• Why: The minimum wage has been increased to $17.96 — before tips — after the city determined workers were making only $11 per hour on average. 
• Where: New York City.

(June 16, 2023)

New York City has set a new minimum wage of at least $17.96 per hour — before tips — for food delivery workers, with the increased rate going into effect July 12. 

The minimum-wage increase is the first such increase in the country for delivery workers and goes into effect almost two years after the city council passed bills aimed at improving work conditions for delivery drivers, The New York Times reports. 

Critics of the wage increase reportedly argue it doesn’t do enough to increase the minimum compensation for delivery workers, who they say often deal with a number of out-of-pocket expenses due to being independent contractors. 

Industry groups, meanwhile, argue the new law will hurt opportunities for some delivery workers,  and end up simply passing on the costs to consumers and restaurants that they say already pay a hefty fee to use delivery apps, The New York Times reports. 

There are more than 60,000 individuals working delivery jobs in New York City, with workers reportedly bringing in an average of around $11 per hour — lower than the current minimum wage of $15 — after factoring in expenses and tips. 

Food delivery companies given flexibility on how to compensate workers 

The new rule will allow companies — such as GrubHub and DoorDash — flexibility in how they pay delivery workers, allowing them to compensate them per trip, per hour worked or a combination of both, The Washington Post reports. 

Food delivery companies will also reportedly be required to pay workers a wage of 30 cents per minute when they are technically “on call” — when they are connected to the delivery apps while waiting for an order, for example. 

Delivery workers will also be mandated to receive 50 cents per minute during the course of a delivery, with the rate scheduled to increase to 53 cents per minute in 2024 and 55 cents in 2025, The Washington Post reports.

New York Mayor Eric Adams and the New York Department of Consumer and Worker Protection — which announced the new rule earlier this week — are also reportedly calling to increase the minimum wage for delivery workers to $19.96 per hour by 2025. 

A DoorDash spokesperson told The Washington Post “litigation is definitely on the table,” in response to the new rule. 

Earlier this year, GrubHub, Postmates, Uber Eats and DoorDash appealed a New York federal judge’s ruling that an antitrust class action lawsuit filed against them does not need to be settled through arbitration. 

Do you agree with the minimum wage increase for New York City delivery workers? Let us know in the comments.

Read About More Class Action Lawsuits & Class Action Settlements:

• Walmart customers file class action following FTC lawsuit fraudulent money transfers
• Chase class action claims Zelle glitch caused double payment debits
• PGA Tour, LIV announce merger, ending litigation
• Nascar asks judge to dismiss crypto meme coin lawsuit