New York City mandates a minimum wage of $18 per hour for food delivery workers

Food delivery workers in New York City will have a minimum wage imposed by law, making it the first city in the US to do so. Delivery apps such as Uber Eats and GrubHub are required to pay their workers $17.96 per hour, in addition to tips, by July 12, with an increase to $19.96 per hour by 2025, adjusted for inflation. The city’s Department of Consumer and Worker Protection (DCWP) agency set this wage above the current $15 per hour minimum wage to account for delivery workers categorised as contractors, who pay higher taxes and work-related expenses out of pocket. The DCWP estimates that over 60,000 food delivery workers in New York earn an average of $7.09 per hour.

The new hourly rate is lower than the $23.82 originally proposed by the DCWP, which revised its estimate in March to include “multi-apping,” where workers deliver food for more than one app simultaneously. Delivery app companies including Uber and GrubHub have pushed back against the regulation, stating that they want to ensure the $30 per hour wage is funded by eliminating jobs and reducing tips while requiring workers to deliver orders faster. However, the new law allows each company to structure worker payments as they choose, provided they meet the city-mandated minimum wage. If a company pays only for trip time, they must pay approximately 50 cents per minute, while firms paying for full logged-in time, including any downtime waiting for an order, must pay approximately 30 cents per minute, not including tips. New York City mandated a minimum wage for ride-hail drivers in 2022.

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