DoorDash is being misleading when they imply that NYC required a minimum wage of $29.93/hr for delivery workers. DoorDash could comply with the bylaw by paying its contractors $17.96/hr for the full time they work (including time waiting for orders). But DoorDash instead chose to use the "Alternate Method" which has a 67% higher minimum wage, but only for the time the contractor is actively delivering food (not standby time). (full text of bylaw: https://codelibrary.amlegal.com/codes/newyorkcity/latest/NYC...)
The implication that Dashers earn 2x more per hour than "other workers" earning minimum wage is false, since "other workers" are paid for 100% of the time they work, including when they are waiting for work.
As an old person, I'd like to point out that my hometown of New York City had a dynamic, world class restaurant scene, including a cornucopia of home delivery, long before the tech platform companies found a way to siphon ~40% of consumer spend out of the local restaurant economy in exchange for some friction reduction. We were doing great. But you had a drawer full of paper menus and had to call the restaurant.
This was not very doable pretty much everywhere outside NYC. The lower density of restaurants made it harder for delivery to be a thing except all the pizza places that offered it.
And if you called the restaurant enough, you typically got on a first name basis with them and had incredible customer service. Now you're just another customer #47523 that created order #37324.
The time savings of having a digital, interactive menu, where you don't have to worry that the person on the other end will interpret "no mayo" as "extra mayo" should not be underappreciated.
I love that you have posted this. I am also old and I think about this from time to time.
Nothing makes me feel so old as observing the phenomenon of people (mostly younger) habitually ordering food through these platforms, paying $5 to $10 in platform and delivery fees per meal. All this against the economic reality that wages have not kept up with the rising cost of, well, everything and it just looks a lot like rent-seeking on the part of these platforms. I do appreciate how the platforms have brought near-universal delivery to the suburbs, but I've lived in the suburbs my whole life and I simply do not use these services due to the cost. Same goes for ride-sharing. My only usage of these platforms is when I'm traveling.
Has the local restaurant scene recovered from the lockdowns? I live in a smaller city and we have recovered some but it's nothing like it was. I heard it was particularly rough in NYC.
The platform fees and the insane menu price markups that restaurants apply for delivery app orders have made it impractical to use Uber Eats & DoorDash for a couple years now IMO. I only ever consider using them when offered at least 50% off.
Mandated minimum earnings will benefit the drivers, but that won't help drivers that have to quit the platforms because people stop using them.
> With the changes required by NYC and the impact it will have on our system, we are pausing our Priority Access program, which gives Dashers who have high ratings priority on higher-paying offers. Since Dashers will earn a guaranteed minimum rate, the benefits offered by this program will not apply in NYC. The Top Dasher program is still available for qualified NYC Dashers.
So they're guaranteeing higher pay for all workers, and cutting a benefit for their best workers? I wonder what kind of impact this will have. Will this encourage some of these top workers to leave the platform, since they can no longer get access to good orders based on their track record?
I read an interesting article about delivery drivers in NYC, specifically how much of the market was completely unregulated and illegal, and how people work within what functions as an underground economy:
The person doing the work often isn't the person registered with (e.g.) DoorDash. There's a whole economy of middlemen who resell straw buyers' credentials/accounts.
This obviously happens with Uber also, and to some extent AirBnB. A lot of "super" hosts have someone completely different manage the listing and the host is really just a brand for the listing page at that point.
This seems to be the case in bay area too. The person delivering the food is not the same person in the DoorDash app. It used to be rare before but not anymore. (sample size of 1, as recent as 2 days ago).
In New York City five years ago I was switching from one IT career to another (Unix sysadmin to programmer), and was working part-time for a very small startup that had run out out of seed money, while interviewing for more lucrative positions (which I found four years ago). The founders were working a day job, and funding me out of pocket, which was to the tune of $100 a month. For a variety of reasons I decided to do Postmates deliveries, one reason being the flexibility.
Running around Manhattan on cold November nights five years ago, I began to appreciate the $100 a month I was getting programming for this small startup at my desk at home or in their co-working space. If you don't have a bicycle or car, you pretty much need a metro-card, which goes to your expenses. Sometimes orders came in right away, sometimes I'd be sitting around for over 20 minutes waiting for one. The food pickup location was always within half a mile of my location. The quickest pickup offer to delivery for me was 23 minutes, longest was 52 minutes. With waits of up to half an hour before a next offer.
Deliveries usually paid a little over $4, but there were bonuses of $2 for some deliveries, and you'd be paid for long distances or long waits for food. You would also get tips (up to $7).
As I said, I was getting paid $100 a month to do some programming for a small startup, which seemed very little, but it was a lot easier than how much time and effort it took running around Manhattan to earn $100 from Postmates.
About six months after doing occasional Postmates deliveries I was making over $60 an hour programming for a multi-national.
> Dashers who deliver in NYC will now earn at least $29.93 per hour of active time, nearly twice NYC’s $15 minimum wage for other workers.
What’s a realistic amount of “active time” per hour? I’m assuming waiting for a job is not active time right?
> These new regulations will force us to raise fees for orders in New York City. In order to better balance the impact of these new costs, we’re moving the option to tip in the DoorDash app to after checkout.
So hiding the tip until after closing the sale to pretend the total price is cheaper? Very classy.
What’s funny is that the tip should come after the service is complete if it’s actually a tip for good service (otherwise how did you know what service you got?). But they’re clearly just trying to hide the true price.
I think you're misunderstanding the change to tipping. DoorDash is effectively eliminating it (or at least making it truly optional). The city's study [1] advocates for this explicitly:
> Beyond productivity, there also exist several other margins for adjustment to higher delivery worker pay. For instance, apps could choose to reduce consumers’ costs through changes to the user interface that discourage or eliminate tipping (or, equivalently, consumers could choose to tip less in light of workers’ higher pay, independent of any changes engineered by apps). The Department finds that if tipping were eliminated at all apps, costs to consumers would increase by $1.06 per delivery (3%) with workers still receiving sizable pay increases.
Basically, the previously "mandatory" tip is now baked into the price upfront. I think this exactly what you want.
> What’s funny is that the tip should come after the service is complete if it’s actually a tip for good service (otherwise how did you know what service you got?). But they’re clearly just trying to hide the true price.
This. I had a recent order with a "SkipTheDishes". It was a semi-big order, and I left the default tip in place, which was over $20 for a 5-10 minute drive. The driver did a few other deliveries on the way, so when I got my meal it was only vaguely warm. Certainly not worth $20, and enabled by the company as they have a mechanism for a driver to take multiple orders at once.
It's only the time between accepting a delivery and finishing it. Time spent waiting for a new delivery offer is not paid.
> After a few minutes of waiting, you are offered and accept an order and drive 10 minutes to get to the restaurant. You wait 5 minutes at the restaurant, then drive another 15 minutes to deliver the order.
> In this example, you spent 30 minutes actively on the delivery, which includes the drive to the restaurant, the wait at the restaurant, and the drive to drop off the order.
I think they're hiding the tip after the talk about drivers shopping for tips. As I understand it, before you would tip up front, and so the drivers knew which orders would have better tips.
Letting the customer tip after the order has been received lets the customer evaluate, and tip, the overall actual service. And prevents drivers from prioritizing those orders with better tips.
I did a quick search and it appears the law sets a minimum of about $20 per hour. So I guess DoorDash considers there to be about 40 minutes of "active time" per hour?
Tipping is a cultural convention. You don't tip for service, you tip because it is our custom. You don't have to tip, but then you risk backlash for violating social norms. If you really like the service, you can tip extra. If not, you can give a low rating or and/or write a negative review and/or not patronize them again.
In the UK with Uber Eats/Deliveroo you can select a tip when you order and then you can modify the tip up to a short time after the order. So you can just put no tip and then add one after delivery if it’s good service, or increase/decrease it. Is that not how it works with DoorDash?
DoorDash sent out an email yesterday informing customers of the changes. They only mentioned that tipping was moving to after the checkout step, but nothing else. I simultaneously decided to stop ordering DoorDash yesterday; I've been gaining too much weight recently and spending too much money.
They can keep it. I refuse to bribe someone to deliver my food with a tip, before. I'm not even going to get into when a driver eats the meal, you have zero recourse, in practical terms.
I'm done with companies not only charging more, but requiring that I assist them AGAIN with payroll.
The NYC report is interesting but also very problematic.
The justification of the minimum pay over NYC minimum wage is a mixture of reasonable (DoorDash not paying employee taxes, worker costs) and ... creative (like rolling in cost of living adjustments to minimum wage just because you can).
More importantly:
> First, the model assumes that, from 2023 to 2025, apps will respond to the minimum pay rate by increasing deliveries per hour worked from the current 1.63 to 2.50. This assumption is based on the Department’s identification, using the record-level data obtained from apps, of large differences between apps in the number of deliveries per hour.
Their "model" is making HUGE assumptions about the apps being able to "innovate" in NY, based on data coming from their own black-box reported numbers. And nearly all of calculations about how the pricing, cost to businesses, customer price sensitivity, and take-home pay of the workers is entirely based on very flimsy projections.
I have no problem if NY wants to level the playing field between employees and contractors so that apps have to pay fair. But they are taking things one step further just because they have the mandate to do so. And there's no way that the people setting policy based on these arbitrary numbers are ever going to be held accountable for them.
"Tips" were effectively bids for service under the old model, as they were paid before the service was performed and determined whether a driver felt it worthwhile to accept that order. Now DoorDash will have to dynamically figure out how much to charge the customer to both interest drivers and meet this minimum pay requirement. I'm interested in seeing how it turns out.
I personally feel like outsourced delivery for hot food orders at peak hours is a flawed idea. I've used Grubhub and it seems like they try to group deliveries. In my situation, I had a driver pick up my food only to drive it around down and deliver it to me 40 minutes later. If I order from a place and they don't have a driver on staff, I won't order delivery.
In NYC delivery is too good. I'd say 20-40 minutes about 90% of the time. I'll even order fried food and know it will still be crispy!
I used to live in downtown SF, which is one of the densest urban areas in the US outside of NY, and I would only reluctantly order delivery because the average wait was closer to 75 minutes. I'd wait 1.5 hrs before checking on the order. Food reliably showed up cold.
Yeah, stacked orders are a joke. From DD-related subreddits, it seems the algo typically bundles low tip orders with higher tipping orders. This is so the low tippers finally get their stuff delivered because no one else was taking it individually.
The problem isn't that they group orders, it's that you weren't aware of it and weren't given the choice. You were made to believe that you were paying for a direct order and it's only after the fact you realize but by then it's too late and getting your money back is a hassle. There would be no problems if you were given the choice upfront to pay less for a grouped order or more for a direct order.
The problem is that these companies need to somehow pay for all that "growth & engagement" and so have insane overheads, so being upfront about the costs will mean they'd get no business, so instead they obfuscate it as much as possible like in the above scenario or outright steal drivers' tips.
Seems insane that people living in inner cities need to get food delivered. Unless there is a good reason you are handicapped etc. or maybe just had a baby. But for most people routine delivery when you can walk 5 minutes and phone ahead that order is fine.
I feel like the only viable model for these delivery apps is delivery with autonomous vehicles like Nuro (or any other, this is just the company I have heard of). Whether that’s actually viable and how soon, I have no idea, but the model as it stands does not work currently.
A whole lot of people will lose income (no matter how mediocre) if this were to come to fruition though.
Interested in how they count hours - are the only hours counted the hours where you are actively picking up / delivering an order? Or are employees also compensated for time spent waiting/looking for orders?
> As always, 100% of a consumer’s tip goes to the Dasher.
“As always” is a lie. Moving the tip prompt to after checkout is far more consequential than they’re admitting.
Previously, the way it worked was that you could tip $0 and they would compensate by steadily increasing their offer for the job until a dasher accepted it. This essentially meant that pre-checkout “tips” were bonus money for DoorDash, not the workers. It sounds like that scam is finally going away. No wonder they refer to the regulatory changes as “bad policies”. This is coming in other major markets and they know it.
I quit using all those services due to the menu markup, service fees, and then the tipping shit ball topper.
If I'm using I service for the express purpose of delivery, and paying a premium for it, I don't need a culture of expected tipping on top. I miss the days of Uber baking supply/demand pricing and that was the end of it.
Do other people in NYC use Doordash? Curious to understand people who do.
Anecdotally, I never have even considered it – although it's true that I'm somebody who prefers choosing my own groceries.
I feel like the value prop (i.e. value less [opportunity] costs) is de minimis to most in NYC, with abundant grocers and restaurants at every price point.
Yeah but then you have to leave your home. I know people who use it plenty because they're too lazy or busy (the person I know who uses it most is in med school and has basically no life currently except for studying and school).
I use it when I'm too sick to leave home and I'm not stocked up on food. Or board game nights when we don't want someone to have to leave to pick up food. All the delivery apps have such bad customer experience though, we usually now just agree on food beforehand and have one person pick it up on their way.
Absolutely blows my mind the kind of money people will spend to avoid 10 minutes of driving.
Even now that I am making substantially more money, pretty much Doordash's prime demographic, I find it such a terrible deal that I simply cannot bring myself to use it.
[+] [-] zepton|2 years ago|reply
The implication that Dashers earn 2x more per hour than "other workers" earning minimum wage is false, since "other workers" are paid for 100% of the time they work, including when they are waiting for work.
[+] [-] crmd|2 years ago|reply
[+] [-] darth_avocado|2 years ago|reply
[+] [-] candiddevmike|2 years ago|reply
[+] [-] phendrenad2|2 years ago|reply
[+] [-] oldandboring|2 years ago|reply
Nothing makes me feel so old as observing the phenomenon of people (mostly younger) habitually ordering food through these platforms, paying $5 to $10 in platform and delivery fees per meal. All this against the economic reality that wages have not kept up with the rising cost of, well, everything and it just looks a lot like rent-seeking on the part of these platforms. I do appreciate how the platforms have brought near-universal delivery to the suburbs, but I've lived in the suburbs my whole life and I simply do not use these services due to the cost. Same goes for ride-sharing. My only usage of these platforms is when I'm traveling.
[+] [-] Consultant32452|2 years ago|reply
[+] [-] up2isomorphism|2 years ago|reply
[+] [-] Aeolun|2 years ago|reply
[+] [-] graphe|2 years ago|reply
[+] [-] 8bitben|2 years ago|reply
Mandated minimum earnings will benefit the drivers, but that won't help drivers that have to quit the platforms because people stop using them.
[+] [-] legitster|2 years ago|reply
It takes 10 minutes for a chef to make my meal, and 25 minutes for someone to come to the restaurant, pick it up, and drive it to my house.
The only way it works is if someone else's time is an order of magnitude less valuable than yours.
[+] [-] kiba|2 years ago|reply
[+] [-] gnicholas|2 years ago|reply
So they're guaranteeing higher pay for all workers, and cutting a benefit for their best workers? I wonder what kind of impact this will have. Will this encourage some of these top workers to leave the platform, since they can no longer get access to good orders based on their track record?
[+] [-] perihelions|2 years ago|reply
https://www.nytimes.com/2023/09/15/nyregion/migrant-delivery...
The person doing the work often isn't the person registered with (e.g.) DoorDash. There's a whole economy of middlemen who resell straw buyers' credentials/accounts.
[+] [-] have_faith|2 years ago|reply
[+] [-] markha|2 years ago|reply
[+] [-] levelz|2 years ago|reply
Running around Manhattan on cold November nights five years ago, I began to appreciate the $100 a month I was getting programming for this small startup at my desk at home or in their co-working space. If you don't have a bicycle or car, you pretty much need a metro-card, which goes to your expenses. Sometimes orders came in right away, sometimes I'd be sitting around for over 20 minutes waiting for one. The food pickup location was always within half a mile of my location. The quickest pickup offer to delivery for me was 23 minutes, longest was 52 minutes. With waits of up to half an hour before a next offer.
Deliveries usually paid a little over $4, but there were bonuses of $2 for some deliveries, and you'd be paid for long distances or long waits for food. You would also get tips (up to $7).
As I said, I was getting paid $100 a month to do some programming for a small startup, which seemed very little, but it was a lot easier than how much time and effort it took running around Manhattan to earn $100 from Postmates.
About six months after doing occasional Postmates deliveries I was making over $60 an hour programming for a multi-national.
[+] [-] koolba|2 years ago|reply
What’s a realistic amount of “active time” per hour? I’m assuming waiting for a job is not active time right?
> These new regulations will force us to raise fees for orders in New York City. In order to better balance the impact of these new costs, we’re moving the option to tip in the DoorDash app to after checkout.
So hiding the tip until after closing the sale to pretend the total price is cheaper? Very classy.
What’s funny is that the tip should come after the service is complete if it’s actually a tip for good service (otherwise how did you know what service you got?). But they’re clearly just trying to hide the true price.
[+] [-] devrand|2 years ago|reply
> Beyond productivity, there also exist several other margins for adjustment to higher delivery worker pay. For instance, apps could choose to reduce consumers’ costs through changes to the user interface that discourage or eliminate tipping (or, equivalently, consumers could choose to tip less in light of workers’ higher pay, independent of any changes engineered by apps). The Department finds that if tipping were eliminated at all apps, costs to consumers would increase by $1.06 per delivery (3%) with workers still receiving sizable pay increases.
Basically, the previously "mandatory" tip is now baked into the price upfront. I think this exactly what you want.
[1]: https://www.nyc.gov/assets/dca/downloads/pdf/workers/Deliver...
[+] [-] 1000100_1000101|2 years ago|reply
This. I had a recent order with a "SkipTheDishes". It was a semi-big order, and I left the default tip in place, which was over $20 for a 5-10 minute drive. The driver did a few other deliveries on the way, so when I got my meal it was only vaguely warm. Certainly not worth $20, and enabled by the company as they have a mechanism for a driver to take multiple orders at once.
Truly horrible service is now standard.
[+] [-] hoten|2 years ago|reply
[+] [-] squeaky-clean|2 years ago|reply
> After a few minutes of waiting, you are offered and accept an order and drive 10 minutes to get to the restaurant. You wait 5 minutes at the restaurant, then drive another 15 minutes to deliver the order.
> In this example, you spent 30 minutes actively on the delivery, which includes the drive to the restaurant, the wait at the restaurant, and the drive to drop off the order.
https://help.doordash.com/dashers/s/article/Time-Earnings-Mo...
[+] [-] whartung|2 years ago|reply
Letting the customer tip after the order has been received lets the customer evaluate, and tip, the overall actual service. And prevents drivers from prioritizing those orders with better tips.
[+] [-] jallen_dot_dev|2 years ago|reply
[+] [-] ketzo|2 years ago|reply
Would love to hear from someone with actual DD experience what percentage of time is “active,” and what you have to do to keep that time high?
[+] [-] makestuff|2 years ago|reply
[+] [-] standardUser|2 years ago|reply
[+] [-] mcintyre1994|2 years ago|reply
[+] [-] MattGaiser|2 years ago|reply
In practice, it is probably to eliminate customers feeling the need to tip, reducing the sting of the higher fees.
Plenty won’t tip if the Dasher won’t see until after.
[+] [-] unknown|2 years ago|reply
[deleted]
[+] [-] Panini_Jones|2 years ago|reply
[+] [-] sonicanatidae|2 years ago|reply
I'm done with companies not only charging more, but requiring that I assist them AGAIN with payroll.
Fucking pay an actual wage or fuck off.
[+] [-] legitster|2 years ago|reply
The justification of the minimum pay over NYC minimum wage is a mixture of reasonable (DoorDash not paying employee taxes, worker costs) and ... creative (like rolling in cost of living adjustments to minimum wage just because you can).
More importantly:
> First, the model assumes that, from 2023 to 2025, apps will respond to the minimum pay rate by increasing deliveries per hour worked from the current 1.63 to 2.50. This assumption is based on the Department’s identification, using the record-level data obtained from apps, of large differences between apps in the number of deliveries per hour.
Their "model" is making HUGE assumptions about the apps being able to "innovate" in NY, based on data coming from their own black-box reported numbers. And nearly all of calculations about how the pricing, cost to businesses, customer price sensitivity, and take-home pay of the workers is entirely based on very flimsy projections.
I have no problem if NY wants to level the playing field between employees and contractors so that apps have to pay fair. But they are taking things one step further just because they have the mandate to do so. And there's no way that the people setting policy based on these arbitrary numbers are ever going to be held accountable for them.
[+] [-] dangrossman|2 years ago|reply
[+] [-] bluSCALE4|2 years ago|reply
[+] [-] standardUser|2 years ago|reply
I used to live in downtown SF, which is one of the densest urban areas in the US outside of NY, and I would only reluctantly order delivery because the average wait was closer to 75 minutes. I'd wait 1.5 hrs before checking on the order. Food reliably showed up cold.
[+] [-] hypeatei|2 years ago|reply
[+] [-] Nextgrid|2 years ago|reply
The problem is that these companies need to somehow pay for all that "growth & engagement" and so have insane overheads, so being upfront about the costs will mean they'd get no business, so instead they obfuscate it as much as possible like in the above scenario or outright steal drivers' tips.
[+] [-] quickthrower2|2 years ago|reply
[+] [-] theappsecguy|2 years ago|reply
A whole lot of people will lose income (no matter how mediocre) if this were to come to fruition though.
[+] [-] 19f191ty|2 years ago|reply
[+] [-] unknown|2 years ago|reply
[deleted]
[+] [-] dontcontactme|2 years ago|reply
[+] [-] SheinhardtWigCo|2 years ago|reply
“As always” is a lie. Moving the tip prompt to after checkout is far more consequential than they’re admitting.
Previously, the way it worked was that you could tip $0 and they would compensate by steadily increasing their offer for the job until a dasher accepted it. This essentially meant that pre-checkout “tips” were bonus money for DoorDash, not the workers. It sounds like that scam is finally going away. No wonder they refer to the regulatory changes as “bad policies”. This is coming in other major markets and they know it.
[+] [-] itamarst|2 years ago|reply
Relevant to "active time", they seemed to spend a lot of time during the day just waiting around...
[+] [-] Rapzid|2 years ago|reply
If I'm using I service for the express purpose of delivery, and paying a premium for it, I don't need a culture of expected tipping on top. I miss the days of Uber baking supply/demand pricing and that was the end of it.
[+] [-] gen220|2 years ago|reply
Anecdotally, I never have even considered it – although it's true that I'm somebody who prefers choosing my own groceries.
I feel like the value prop (i.e. value less [opportunity] costs) is de minimis to most in NYC, with abundant grocers and restaurants at every price point.
[+] [-] squeaky-clean|2 years ago|reply
I use it when I'm too sick to leave home and I'm not stocked up on food. Or board game nights when we don't want someone to have to leave to pick up food. All the delivery apps have such bad customer experience though, we usually now just agree on food beforehand and have one person pick it up on their way.
[+] [-] Workaccount2|2 years ago|reply
Absolutely blows my mind the kind of money people will spend to avoid 10 minutes of driving.
Even now that I am making substantially more money, pretty much Doordash's prime demographic, I find it such a terrible deal that I simply cannot bring myself to use it.