Three large food delivery companies are suing New York City to stop the implementation of minimum wage requirements for gig workers, claiming that regulators used inaccurate data to determine the new compensation guidelines.
The Reason behind Price Hikes
To prevent the pay adjustments from taking effect on July 12th, Uber, DoorDash, and Grubhub each filed a request for a temporary restraining order on Thursday in State Supreme Court in Manhattan. Relay, a smaller meal delivery service with roots in New York, followed suit. In accordance with the new pay standard, which was unveiled last month, gig platforms must pay food delivery Companies roughly $18 per hour, with a rise to $20 per hour by 2025. The city estimates that delivery workers presently make about $11 per hour.
Uber and the other gig economy businesses, however, assert that they will be compelled to increase their pricing in order to cover the expense of the higher pay. They contend that the city’s modelling miscalculates the extent to which these increased prices will hurt neighbourhood restaurants. And they assert that the new approach will be detrimental to deliverers because the business will have to closely monitor how much time they spend online using the apps without actually making deliveries in order to minimize costs.
Justifications for the New Wage Standard
Josh Gold, an Uber representative, stated that the rule “must be paused before damaging the restaurants, customers, and couriers it claims to protect.” The Department of Consumer and Worker Protection’s commissioner, Vilda Vera Mayuga, justified the new wage standard in a written statement. Food Delivery Companie workers, like all workers, should receive adequate compensation for their efforts, and she expressed disappointment that Uber, DoorDash, Grubhub, and Relay did not agree. “We remain committed to delivering for New Yorkers, and these workers risk their lives to do so, despite thunderstorms and extremely hot weather events.”
The dispute over pay for delivery workers in New York is a part of a nationwide one that has been going on for a while between gig economy corporations and labour groups. Deliverers of gigs are considered independent contractors, thus they are liable for their own expenses and do not receive a minimum income or health benefits. Uber and other gig businesses claim that their employees love the freedom to choose their own schedules and independence, but labour organisations contend that they are being taken advantage of and need more rights.