The ordinance to raise wages for Uber Eats delivery workers is having a negative impact on users, restaurants and delivery workers
In some areas of the United States, delivery app workers, including Uber Eats and Door Dash, are required to raise their wages. It has been reported that the number of orders has dropped significantly and the income of delivery workers has also decreased as a result of the increase in fees for food delivery services to accommodate the wage increase for delivery workers.
Delivery Drivers Got Higher Wages. Now They're Getting Fewer Orders. - WSJ
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In December 2023, New York City enacted an ordinance that requires Uber Eats and other companies to pay a minimum wage based on the time they spend delivering ordered items and to provide additional rewards to delivery workers who deliver efficiently. With the enforcement of the ordinance, delivery workers working in New York City will be paid $19.56 (about 3,100 yen) per hour, which is the minimum wage at the time of writing.
Some New York City Council members who helped draft the ordinance have highlighted its success, saying, 'These changes will help workers.'
A similar ordinance was passed in Seattle, and following the implementation of this ordinance, Uber Eats, DoorDash, Instacart, and others introduced a fee of $4.99 (about 800 yen) per order to cover the city's new salary requirements. As a result, the number of orders in Seattle was reported to have decreased by about 45% in the first quarter of 2024 compared to the same period last year.
'I used food delivery services a few times a week,' said Seattle-based researcher Lo Xin. 'But since Seattle adopted new wage standards in January 2024, the prices of food on the apps have gone completely ridiculous, with various delivery fees being charged on top of tips. These services are setting the price of a burrito, which would cost $10 for takeout, at $20, about double the price. This is insane.'
Uber CEO Dara Khosrowshahi pointed out, 'We've had to cut about 25% of our delivery workers in New York City. So far, the ordinance has hurt the people it's supposed to protect.' Gary Lardizabal, who works as a delivery worker in Seattle, said, 'The new ordinance and fees have almost eliminated my breakfast and afternoon snack deliveries, and my income has dropped significantly even though I'm working more hours.' Lardizabal is calling on the Seattle City Council to reverse the pay changes for delivery workers.
In response to these protests, Seattle City Council Speaker Sarah Nelson reported that 'due to ongoing protests from drivers and restaurants about the devastating impacts, city officials are planning to reverse the wage increase.'
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