The New York City Council passed a bill last night that would permanently cap delivery fees for companies such as DoorDash, Uber Eats and Just Eat in a move that has outraged delivery companies, who call the caps unconstitutional.
Mayor Bill de Blasio has not yet said whether he plans to sign the bill, which has been sent to his desk for signature.
The bill permanently extends the cap, which has been temporarily in place for the course of the pandemic. It passed in a 39-3 vote. The law prevents delivery companies from charging restaurants a fee of more than 15% per order for delivery, no more than 5% per order for all other fees and no more than 3% for all transaction fees.
San Francisco passed a similar law this June that made permanent its own pandemic-era limit on fees.
"Fee caps increase delivery fees for consumers, and therefore lead to a reduction of orders for both restaurants and couriers. We believe that these fee caps are unconstitutional, and we will join the industry to oppose them," Just Eat Takeaway CEO Jitse Groen wrote in a Tweet Friday morning. Grubhub made a similar argument for past fee caps bills in other jurisdictions.
"The fact is, permanent price controls are unnecessary and unconstitutional, and will hurt small businesses, delivery workers, customers and the local economy. New York's restaurants need choice more than ever, and this dangerous government overreach will severely limit the options small businesses rely on everyday to succeed," a DoorDash Spokesperson wrote in a statement.
Larger delivery companies such as DoorDash and Uber Eats may not actually see major financial affects from the caps, as they have already designed tiered marketing pricing models that would allow them to skirt the laws because they aren't structured as fees.
Climate TRACE's data show emissions at the facility-level.Image: Climate TRACE