Nobody likes NYC’s $18 delivery worker minimum wage

New York City has set a minimum wage for food delivery workers like Uber Eats, DoorDash, Grubhub, and Relay. It should be a historic win for gig workers, but delivery workers and companies are unhappy.

Many workers, labor rights activists, and even the city comptroller say the minimum wage, just under $18 per hour, is not enough to cover NYC living costs or delivery driver costs. “Litigation isn’t off the table,” a DoorDash spokesperson told , claiming the ruling will harm workers.

Many delivery workers agree that perfect shouldn’t be the enemy of good. According to a city release, NYC delivery workers earn $7.09 per hour, so the new ruling is a boost. However, this divisive issue will only deepen the divide.

Delivery companies can choose between two city-set minimum pay rates. The first option requires companies to pay workers at least $17.96 per hour, excluding tips, for app use, including waiting for a gig. Inflation will raise this to $19.96 per hour next year.

Apps could charge $0.50 per minute of active time, excluding trips. From accepting a delivery to delivering the food, workers are active.

Industry experts expect gig companies to pay $0.50 per active minute. These companies often charge by the minute.

Companies must pay 120% of the local minimum wage for active miles in California under Proposition 22. If the minimum wage is $14 per hour, a 15-minute door-to-door delivery would earn $4.20.

Late, too little
Deliveristas, app-based delivery workers, and labor rights activists say the city is six months late in setting a minimum pay rate and that the revised rules are lower than the initial proposal. The city proposed a $24-per-hour minimum in November.

According to NYC Comptroller Brad Lander, the $18-per-hour pay rate will drop to $13 after expenses.

Local Law 115, passed by the Department of Consumer and Worker Protection (DCWP) in September 2021, mandated a minimum delivery worker pay rate by January 1, 2023. Many gig workers publicly demanded a half-year’s back pay.

“City Hall acquiesced to the lobbying of multibillion-dollar app companies, delaying the raises owed to deliveristas six months ago and setting a sub-minimum-wage standard that pads corporate profits off the backs of some of the hardest workers in our city,” said Lander.

Lander said the minimum wage should be paid after expenses. Most NYC deliveryistas ride mopeds or e-bikes. Joco, Zoomo, and Whizz rent daily, weekly, and monthly. Joco rents docked e-bikes for six hours per day for $65 per week. Whizz and Zoomo offer $179 and $199 monthly e-bike subscriptions, respectively.

“There is no doubt that this is a positive step forward, but the pay issue has been researched and studied, and this is simply not enough money for this job,” said Veena B. Dubal, law professor at the University of California College of the Law, San Francisco. “This is dangerous work, and New York is expensive. Its predictability and raise are welcome, but they’re not enough.”

Deliveristas, who commented on the proposal, agreed with Dubal. Many workers have reported workplace accidents, theft, and assaults that the companies don’t cover because they’re independent contractors.

“Now that we are about to achieve the minimum wage, the new challenge will be for these companies to comply with the proposal issued by the city, so it is important and also a responsibility that we workers have to denounce and report any abuse that these companies may have in this process of change that must now be in favor of us workers,” wrote Vik, a worker. “It is historic that thousands of people will benefit after years of free labor.”

Working hard or not?
Companies say the ruling will hurt delivery workers. DoorDash and Grubhub spokespeople said a minimum wage would require platform changes that could hurt gig workers.

Companies may restrict platform access for part-time or non-gig workers. Staying on the platform will require almost twice the effort. The DCWP predicts 1.6 to 2.5 deliveries per hour.

“The city is lying to delivery workers—they want apps to fund this increase by eliminating jobs and reducing tipping while forcing the remaining workers to deliver orders faster,” said Uber spokesperson Josh Gold.

While gating access for part-time workers is a possibility, Sergio Avedian, senior contributor at The Rideshare Guy and self-proclaimed UberEats “cherry picker,” says demand for delivery workers is likely high enough, especially in NYC, to keep a mix of full-time and part-time workers.

Avedian said Uber was telling people to run their asses off. “NYC does that anyway.”

Companies may need to change their platforms to prevent workers from receiving payments twice from various apps. Many gig workers use “dirty apping” to get as many gigs as possible. Avedian believes companies will improve worker location tracking to catch them stealing orders from other apps.

Since I’m paying your minimum wage, they may force workers to take every order. Avedian admonished cherry picking.

App companies can keep things tidy by ensuring delivery workers stay loyal to each platform, but it may lead to employment problems. App companies have a harder time arguing that workers are independent contractors if they can only work for one company and must complete all orders.

Avedian noted that the ruling does not require delivery workers to remain independent contractors or give up their right to collective bargaining or unionization.

“In most places where Uber agrees to a rate hike for drivers, the drivers give up their rights and say, ‘Okay, we’re going to stay independent; just give us higher rates,’” Avedian said. “All these gig companies are concerned now and trying to nip it in the bud at the start.”