A landmark minimum wage law aimed at increasing pay for nearly 60,000 delivery workers in New York City was delayed on Friday, July 7th, due to a court order. The order came just days before the law was scheduled to take effect.
Manhattan Supreme Court Judge Nicholas Moyne issued a temporary restraining order after DoorDash, Grubhub, Uber, and Relay lodged a legal challenge.
The four food delivery companies responsible for the bulk of food deliveries in New York City are attempting to block the new law, which would mandate an hourly pay rate of $17.96, making New York the first major United States city to implement such pay requirements for delivery workers.
Judge Moyne’s decision provisionally nullifies the Department of Consumer and Worker Protection’s June 12 rule, which would have substantially increased the current average delivery workers’ wage of approximately $11 per hour, far below the city’s $15 minimum wage.
According to the delivery companies, they are not fundamentally against raising workers’ wages. However, they argue that the law will compel them to transfer added expenses to consumers, potentially driving away business and alleging bias in the city’s rulemaking process.
Vilda Vera Mayuga, head of the Department of Consumer and Worker Protection, expressed deep disappointment at the delay. She said, “These apps currently pay workers far below the minimum wage, and this pay rate would help lift thousands of working New Yorkers and their families out of poverty.”
Sergio Ajche, the founder of Los Deliveristas Unidos, also echoed dissatisfaction with Moyne’s decision and criticized the companies for exploiting their financial and political influence.
In contrast, spokespersons for DoorDash, Grubhub, and Uber all welcomed the decision, citing its protection from the adverse impacts of an extreme earnings standard.
Eli Scheinholtz, a spokesperson for DoorDash, said, “Today’s decision is an early and promising victory for consumers, local businesses, and delivery workers across New York City, protecting them from the harmful and lasting impacts of an extreme earnings standard that resulted from a fundamentally broken process.”
The legal challenge also alleges that the city’s Department of Consumer and Worker Protection did not conduct an unbiased survey of the industry and workforce during the rulemaking process. They claim the law unfairly targets app-based food delivery platforms by excluding grocery delivery platforms.
The law, intended to increase the hourly wage to $19.96 before tips by April 2025, was anticipated following a lengthy legislative and rulemaking process. It was initially supposed to be implemented in January, but lobbying from major delivery companies led to a reopening of the public rulemaking process, causing a nearly six-month delay.