DoorDash Raises Delivery Fees In NYC In Response To Minimum Wage Demands

DoorDash has implemented the Regulatory Response Fee in New York City as part of its commitment to adjusting fees in response to new minimum wage regulations.

DoorDash has implemented the Regulatory Response Fee in New York City as part of its commitment to adjusting fees in response to new minimum wage regulations. Customers in the city will now bear this fee, introduced to counterbalance the higher hourly wages mandated for app-based delivery drivers in major urban centers like NYC and Seattle. A DoorDash spokesperson confirmed this move, signaling the company’s adherence to its earlier warnings about fee increases due to these regulatory changes.

The Regulatory Response Fee’s specific amount varies by location, ranging from $0.10 to $3.40. In New York City, the fee is set at $1.99, according to DoorDash. Seattle also adopted a new practice recently, highlighting the wider application of this pricing strategy in response to evolving wage rules.

In December, delivery apps, including DoorDash and Uber Eats, removed the option for NYC customers to tip before placing an order. This decision aligned with the city’s mandate that drivers receive a minimum of $17.96 per hour. Instead, these platforms opted to pay drivers $29.93 for each active hour, allowing customers to tip only after the order had been picked up or completed.

Addressing the Regulatory Response Fee in Seattle, DoorDash issued a statement on Jan. 13 emphasizing its role in covering the costs associated with the new regulations. The announcement coincided with the implementation of Seattle’s law. DoorDash also announced a reduction in suggested tip amounts on orders to balance the impact of these additional costs better.

Uber Eats has adopted a similar approach, introducing fees on orders in New York and Seattle in response to the respective cities’ legislative changes. Concurrently, Shipt, a delivery service owned by Target, opted to suspend operations in Seattle preemptively, avoiding the need to comply with the higher wage rate for independent contractors.

Since the early stages of the pandemic, workers in the gig delivery sector have reported declining pay across various apps, from Instacart to Walmart Spark. This development underscores the broader challenges workers face in the gig economy amid evolving labor regulations.