Judge rules in favor of NYC minimum wage requirement for app-based workers

A New York state judge ruled in favor of a New York City rule that sets a minimum wage requirement for app-based delivery workers, serving a blow to major food delivery companies that tried to stop the new law.

In a ruling Thursday, New York State Supreme Court Judge Nicholas Moyne denied a request from Uber, DoorDash and Grubhub to block the rule from going into effect. Shortly after the three companies filed suit, Moyne issued a stay on the rule, which paused it from going into effect the following week.  

The law, announced by New York City Mayor Eric Adams and the New York City Department of Consumer and Worker Protection (DCWP) in June, requires food delivery apps to pay their drivers at least $17.96 per hour, not including tips, for the time spent making restaurant deliveries. That minimum wage is then expected to rise to $18.96 hourly in April 2024 and $19.96 hourly in April 2025. 

New York’s more than 60,000 delivery workers currently make an average of $7.09 an hour, according to The Associated Press, which cited the city.

The decision comes as part of DoorDash and GrubHub’s joint lawsuit in July, which was later consolidated with two separate lawsuits from Uber and Relay Delivery.

The DCWP praised Moyne’s decision on Thursday, calling it a “dignified pay rate” for delivery workers. 

While denying the petitions from DoorDash, GrubHub and Uber, Moyne granted a preliminary injunction for Relay, explaining that the New York-based company, unlike the others, cannot immediately change its prices and needs more time to renegotiate contracts with restaurants. 

“In rain, snow, sleet, hail, and heat, our delivery workers have consistently delivered for us — and now we can finally deliver for them,” Adams said in a statement. 

The companies previously claimed the rule would have “drastic” and “immediate” consequences for all parties involved, including a more than $5 increase for New York City consumers per order. They argued the rule would reduce demand for their services and cause reputation and financial harm. 

In Uber’s complaint, the company claimed the cost of orders would increase by almost $6 before inflation and orders would drop by almost 20 percent. It also argued the department made its rule based on “flawed” data from “biased” surveys and “unrealistic expectations.” 

Josh Gold, a spokesperson for Uber, said that New York City “continues to lie to workers and the public.”

“This law will put thousands of New Yorkers out of work and force the remaining couriers to compete against each other to deliver orders faster,” Gold told The Hill.

In a statement shared with The Hill, a DoorDash spokesperson called the decision “deeply disappointing.” 

“The City’s insistence on forging ahead with such an extreme pay rate will reduce opportunity and increase costs for all New Yorkers,” the spokesperson told The Hill, adding the company will “continue to evaluate” its legal options moving forward. 

A spokesperson for GrubHub expressed similar disappointment with Moyne’s ruling, arguing the company is now “forced to make changes” to its platform. 

These changes will “have adverse consequences for delivery partners, consumers and independent businesses,” the spokesperson said in a statement.

The GrubHub spokesperson called the law “the result of a flawed rulemaking process that was not applied consistently to the food delivery industry.”

Adam Cohen, a lawyer for Relay, said in a statement that its couriers earn more than $30 an hour.

“Today’s decision protects those couriers and allows Relay, a local NYC startup, to continue to find opportunities for even more delivery workers to benefit with high earnings,” Cohen said.

—Updated at 5:59 p.m.