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The new proposal appears to target DoorDash.

Proposed NYC bill would require third-party delivery players to disclose tipping practices

Legislation appears to target DoorDash, which recently changed its policy to be more transparent

New York City Council member Ritchie Torres on Wednesday introduced legislation that would require third-party delivery providers to disclose how much of the tip goes to drivers.

In a tweet, Torres said New York City “can no longer afford to turn a blind eye to app-based delivery companies stripping workers of their hard-earned tips. It’s wage theft, plain & simple, and the public has a right to hold businesses accountable for exploiting their workers and stealing their wages.”

The proposal appears to target DoorDash, which last year was implicated in a New York Times report revealing that customer tips were effectively being pocketed by the delivery provider. DoorDash later changed its policy to be more transparent, saying 100% of tips would go to drivers, known as Dashers, on top of base pay and promotions.

In a statement Thursday in response to Ritchie’s proposed legislation, Max Rettig, head of public policy and senior counsel for DoorDash, said, “DoorDash customers can rest assured that 100% of their tip goes directly to the Dasher who earned it — in addition to the base pay our company offers for each delivery. We are always looking for ways to incorporate new ideas that build on our success. We share in Council member Torres’ commitment to transparency and we look forward to working with him to ensure the highest quality experience for our customers and workers.”

If approved, Torres’ bill would require certain New York businesses to disclose how gratuities are provided to delivery workers, including how  much of the tip goes to the worker who delivered the online order, how that tip will be distributed, and how much that tip is used to compose the worker’s base pay.

Businesses that don’t comply with the requirement will be charged a penalty.

Officials with Grubhub declined to comment on the legislation, saying it wasn’t really an issue for them, though the disclosure mandate would be required of all delivery players.

A spokesperson for Uber Eats also declined to comment on the legislation, but noted that 100% of tips goes to their food delivery drivers on top of earnings, and adding that the policy is fully transparent to both delivery people and customers.

The move is the latest thread in an ongoing debate about the regulation of delivery providers in New York City, the nation’s largest delivery market.

Contact Lisa Jennings at [email protected]

Follow her on Twitter: @livetodineout

TAGS: Technology
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