NYC is forming a watchdog agency to regulate delivery services

Mayor Eric Adams says discussions are already underway to launch a Department of Sustainable Delivery for the city, noting it'd be the first of its kind in the nation.
The Department of Sustainable Delivery would regulate how meals get to consumers' homes and offices. | Photo: Shutterstock

New York City intends to further regulate the transport of restaurant meals to homes and offices by creating the nation’s first urban Department of Sustainable Delivery, Mayor Eric Adams revealed Wednesday in his annual State of the City Address.

Talks are already underway with the City Council to launch the new watchdog agency, Adams revealed.

He provided few details but stressed that the goal is to protect delivery drivers and consumers. The one specific he mentioned was having the department enforce protections against the dangers posed by lithium-ion batteries. The devices have been known to ignite when charged with improper cables or otherwise mishandled.

The issue is pertinent to delivery in New York because many deliverers use electric scooters powered by the batteries to navigate the city’s traffic-congested streets.

In making the case for the new department, Adams also mentioned the danger to consumers. “We cannot have mopeds speeding down our sidewalks and forcing people to jump out of the way,” he said.

The move is the latest effort by the Adams administration to provide guardrails on delivery operations and third-party services like DoorDash and GrubHub in particular. The city recently enacted a minimum wage for individuals making food deliveries of $17.96 for every hour spent transporting the orders, exclusive of tips. The new requirement specifies that the rate will rise to $19.96 in April 2025.

It also sets formulas for determining how deliverers should be compensated for the time they wait before being dispatched. Under the compensation method chosen by DoorDash, its “Dashers” will be paid a minimum of $29.93 per hour, or nearly double the city’s required rate of $16 per hour.

DoorDash, UberEats and GrubHub sued to block adoption of the minimum wage for their operations but were rebuffed by an appellate court.

Afterward, DoorDash warned that the increase in its labor costs would have “significant consequences for everyone who uses our platform.”

It took issue at the time with a Restaurant Business report that restaurants were among those parties and hence would likely see an increase in the commissions they pay for delivery sales through DoorDash’s app.  

The company confirmed in an email to RB sister publication Supermarket News that fees will indeed rise for New York City restaurants and consumers who use the DoorDash app.

A spokesperson declined to say when those increases will be adopted or how large they will be.

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