Uber Eats has agreed to pay $10 million to settle an investigation by the City of Chicago that found the delivery company had listed restaurants on its platform without their permission and violated the city’s delivery fee cap.
More than $5 million of the settlement amount will go to restaurants that were affected by the practices.
Chicago began investigating Uber Eats and subsidiary Postmates in 2021, and the two parties have been working to settle the case outside of court since then. While they have reached an agreement, the delivery company continues to deny the city’s allegations, according to the settlement document.
“We are committed to supporting Uber Eats restaurant partners in Chicago and are pleased to put this matter behind us,” a company spokesperson said in a statement.
In August 2021, Chicago filed lawsuits with similar charges against both DoorDash and Grubhub. Those cases are ongoing.
Under the settlement agreement filed last week, Uber Eats will pay $2.25 million to restaurants that were charged commissions higher than 15% while the city’s emergency fee cap was in place.
It will also pay $500,000 to restaurants that were listed on its app without their consent and don’t currently use Uber Eats. And it will provide $2.5 million in commission waivers to those restaurants if they choose to return to the platform in the future.
It’s also paying Chicago $1.5 million to cover the costs of its investigation.
The $10 million figure includes a payment the company made back in September 2021, when, in response to the city’s investigation, it gave $3.3 million to Chicago restaurants that had been overcharged on commissions.
The 15% cap on the amount delivery companies could charge restaurants was enacted in November 2020. It was intended to help restaurants that had come to depend heavily on delivery during pandemic-related shutdowns.
Also in September 2021, Uber Eats removed all Chicago restaurants that it had added to its app without their consent and agreed to end the practice in the city.
Delivery companies use so-called “non-partner” listings to build up restaurant selection in new markets. But the tactic can cause confusion for restaurants and has been outlawed in some places.
The Illinois Restaurant Association said it welcomed the relief for restaurants that struggled during the pandemic and continue to face rising costs.
“No third-party delivery company should be listing restaurants without their consent and all third-party companies should have been following the emergency cap imposed during the pandemic,” said Sam Toia, president and CEO of the association, in a statement. “Our restaurants will receive immediate benefit from this settlement.”
Restaurants can learn more about how to claim their benefits here.
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