A new policy aimed at increasing the minimum wage for app-based food delivery workers could have a considerable impact on small businesses in New York City, according to a report from CNN. The surge in the use of services like Uber Eats and DoorDash since the onset of the pandemic has made these workers an integral part of the restaurant and food industry, including countless small businesses.
Currently, the city’s 60,000 delivery workers earn an average of $7.09 an hour. The city intends to incrementally raise their wages to a minimum of $19.96 an hour by April 2025, with the first increase to $17.96 set for July 12. This wage will be adjusted annually for inflation. This policy change might influence how small businesses approach their delivery strategies, considering the potential increase in delivery costs due to higher wages for workers.
NYC Minimum Wage for Food Delivery Workers
New York City Mayor Eric Adams, said, “Our delivery workers have consistently delivered for us — now, we are delivering for them. This new minimum pay rate…will guarantee these workers and their families can earn a living, access greater economic stability, and help keep our city’s legendary restaurant industry thriving.”
While the delivery apps are given the flexibility to implement this pay rate as they see fit, the policy stipulates certain minimum rates for worker’s waiting and delivery time. This could translate into higher delivery fees for businesses utilizing these apps.
The new policy has stirred mixed reactions within the industry. While advocates, like Ligia Guallpa, executive director of the Worker’s Justice Project, believe the policy will transform the lives of thousands of workers, delivery services like DoorDash and Uber Eats have expressed reservations. DoorDash has indicated that they may challenge the policy in court, and Uber Eats has voiced concerns that the policy could eliminate jobs and discourage tipping.
As this new wage policy unfolds, it could directly affect small businesses relying on these services for delivery. They might need to adapt by adjusting their delivery strategies, costs, and possibly consider alternative options to mitigate any potential financial impact. The overall change underscores the increasing importance of delivery services for businesses of all sizes in the post-pandemic city landscape.
This article, “New Minimum Wage for App-Based Food Delivery Workers in New York City” was first published on Small Business Trends