April 7, 2023
To: Department of Consumer and Worker Protections
Re: Protecting Pay Standard Study for App-Based Food Delivery Workers
In 2022, the Department of Consumer and Worker Protection recommended a groundbreaking wage standard for app-based delivery service workers in New York City. The proposed pay scale represented a major victory for the more than 60,000 deliveristas operating within the five boroughs and provided a model for suitable wage standards for independent contractors doing similar work around the country.
The 2022 proposed rule of $23.82/hour established an hourly pay scale that compensated workers for time they spent on call, and it included components to help offset the expenses delivery workers incur on the job and their lack of health benefits. The proposed rule was a major advance over the status quo of no standard, but it was rightly criticized by many as not having gone far enough. In particular, workers deemed the expense component of the pay scale to be inadequate.
Rather than respond to these arguments for an increase in the wage standard, however, Mayor Eric Adams now seeks to roll back the proposed hourly wage for delivery workers, effectively undoing both major successes from the first proposed rule.
First, the mayor proposed a lower hourly rate of $19.96. This is just not adequate to ensure a decent wage for workers who have to pay for their own equipment, health care coverage, and often work through inclement weather conditions.
In addition, the mayor allows app companies to pick between this normal way of paying an hourly wage, and an “alternative method” that would would only cover the time from pick-up to delivery. That leaves out the time workers spend waiting or traveling to the pick-up. This alternative method effectively allows delivery service companies to opt-out of the hourly wage standard workers fought so hard to achieve. The mayor’s proposal makes a modest effort to include a higher wage standard for companies that choose the alternative method, which aims to ensure pay equity for workers across the two methods. This method would force delivery companies to pay a premium of $33.27 per hour that workers have orders in hand.
While at first glance, this model may sound preferable to the standard, it is a misleading figure. The key point is that it is a rate for the time workers have orders in hand. Paying $33.27 per hour for the time in hand is actually lower than paying $23.82 per hour for the full time people are working. It is intended to be the equivalent to paying just $19.96 per hour for the full work time, but it is in fact likely even less than that.
Because workers are not guaranteed a certain number of deliveries per hour or shift, paying only for time-in-hand ensures that workers will not receive a consistent pay rate from one week to the next, increasing the precarity of their economic situation.
The reduction in the overall rate for payment—from $23.82 to $19.96—primarily comes down to the mayor arbitrarily reducing the wage rate by $3.60 per hour by imposing a penalty for “multi-apping,” an industry myth that the mayor has employed to justify slashing the original wage standard.
“Multi-apping” occurs when deliveristas must log into work for several delivery platforms at once to make ends meet. It is worth pointing out that multi-apping is relatively rare. According to DCWP’s own report, app-based delivery workers in New York spent less than one-fifth (17.7 percent) of their time logged in to more than one application in the fourth quarter of 2021.
Multi-apping is not only uncommon among deliveristas, but also undesirable for workers. Most app-based delivery workers would prefer to work for only one app at a time, but low wages make doing so unfeasible in many cases. The primary driver behind muti-apping is that companies refuse to pay workers for on-call time spent on the app waiting for orders. One of the many virtues of the first proposed rule, in fact, is that it would require delivery service companies to pay for on-call time. A strong hourly wage standard of $23.82 would largely eliminate the need for multi-apping in the first place.
The mayor’s proposed rule uses the myth of multi-apping to justify cutting back a significant wage hike for thousands of New Yorkers by penalizing all delivery service workers regardless of whether they have ever engaged in multi-apping. The $3.60 reduction is little more than an arbitrary way to appease delivery platforms like Seamless, GrubHub, and UberEATS. Instead of going towards supporting workers’ families, that money will instead wind up in the pockets of app owners and venture capitalists who are content to make billions off the backs of New York’s underpaid workers.
The undersigned organizations and individuals join a myriad of voices from within city government including Comptroller Brad Lander, Brooklyn Borough President Antonio Reynoso, and 11 City Council members in urging the Department of Consumer and Worker Protection to institute the first proposed rule that would pay workers $23.82/hour. App-based delivery workers deserve fair compensation for their work serving millions of New Yorkers.
To add your name, click here.
Immigration Research Initiative