Title: Manhattan Judge Blocks Rollout of Minimum Wage Law for Delivery Workers
Subtitle: DoorDash, Grubhub, Uber, and Relay File Lawsuit to Stop Pay Increase
Date: [Insert Date]
In a setback for tens of thousands of delivery workers, a Manhattan judge issued a temporary restraining order on Friday, halting the implementation of a groundbreaking minimum wage law just days before it was set to take effect. The ruling comes in response to a lawsuit filed by DoorDash, Grubhub, Uber, and Relay, the four dominant app-based delivery companies in New York City.
The legislation, which would have made New York City the first major U.S. city to enforce pay requirements for its estimated 60,000 delivery workers, aimed to ensure that these workers receive a minimum wage of $17.96 per hour. Currently, delivery workers earn an average of $11 per hour. The law was scheduled to go into effect on July 12.
The ruling in favor of Uber Technologies temporarily invalidated the Department of Consumer and Worker Protection’s June 12 rule, which aimed to significantly increase the pay of delivery workers. As a result of the restraining order, it remains uncertain when or if the higher pay rate will be implemented.
Vilda Vera Mayuga, the head of the agency responsible for the rulemaking process, expressed disappointment at the delay, emphasizing that the current pay rates are insufficient and condemning the impact on the workers and their families.
On the other hand, Uber’s spokesperson, Josh Gold, expressed hope for collaboration with the city and stakeholders to develop a minimum pay rule that won’t have adverse effects on couriers, consumers, and restaurants.
The recent lawsuits, filed separately by DoorDash and Grubhub as well as Uber and Relay, challenge the local law’s provision that would gradually increase the hourly rate to $19.96 by April 2025. The delivery companies argue that the increased costs would ultimately be passed on to consumers, potentially driving away business and negatively impacting restaurants, particularly small and independent ones.
DoorDash, Grubhub, Uber, and Relay also claim that the city’s Department of Consumer and Worker Protection failed to conduct a fair and objective industry survey during the rulemaking process. They further argue that the law unfairly singles out app-based food delivery platforms by not including grocery-delivery platforms under the rule.
In their joint petition, DoorDash and Grubhub declared that they were challenging the law to prevent “harmful impacts” on the communities they serve. Meanwhile, Relay contended it should be excluded from the law due to its different business model, which connects restaurants directly with couriers.
The highly anticipated minimum wage law had gone through a lengthy legislative and rulemaking process, but delays ensued after the Adams administration reopened the public rulemaking process earlier this year. This move, prompted by pressure from major delivery companies, pushed back the law’s implementation by nearly six months.
Advocates for delivery workers expressed skepticism towards the companies’ motives, while City Comptroller Brad Lander accused them of seeking to extract profits from workers’ labor. The companies’ opposition to wage increases follows DoorDash’s recent announcement that it will offer workers outside New York, California, and Seattle an option to earn between $10 to $19 per hour.
The outcome of the lawsuits and the fate of the minimum wage law for delivery workers remain uncertain. However, the issue continues to shed light on the ongoing debate surrounding the gig economy, worker protections, and fair compensation for app-based platform workers.