(The Center Square) – Recently enacted legislation intended to help app-based delivery drivers receive fair wages is instead hurting delivery drivers, business owners and customers.
Seattle’s App-Based Worker Minimum Payment Ordinance and the App-Based Worker Paid Sick and Safe Time Ordinance went into effect on Jan. 13.
The App-Based Worker Minimum Payment Ordinance requires network companies to pay the greater of a minimum per-minute amount of 44 cents and a minimum per-mile amount of 74 cents or a minimum per-offer amount of $5.
The App-Based Worker Paid Sick and Safe Time Ordinance allows app-based workers to accrue one day of paid sick and safe time for every 30 days with at least one work-related stop in Seattle. This can include shopping at a store or making a delivery within city limits.
However, the new laws are not helping the city’s local gig economy.
Heather Nielson, an app-based delivery driver based in Seattle, told The Center Square that the number of orders through services like Doordash and UberEats have dropped considerably since the laws were enacted in January. Companies like Doordash have implemented regulatory response fees in response to the new laws, causing orders to jump considerably in costs.
“You can be out there for eight to 12 hours a day waiting for an order to come in and you might get two orders in the day,” Nielson said.
One app-based worker who preferred to remain anonymous said it took three hours before they got their first order on Tuesday in downtown Seattle.
Another worker showed The Center Square a breakdown of their earnings activity for Monday, in which they earned a total of $24 on three trips during a seven-hour stretch.
Some Seattle-based gig workers asked the Seattle City Council to repeal the new laws to help them recover.
Gary Lardizabal, another app-based worker, said some delivery drivers are a paycheck away from being homeless as a result of the lack of orders.
“We can’t pay rent,” Lardizabal said.
Doordash said that its workers in Seattle now earn at least $26.40 per hour, before tips plus additional pay for mileage while on delivery. However, Nielson said that these estimates assume someone is working eight hours straight or 40 hours per week, which is not common.
Doordash’s latest data shows that just over two weeks since the pay regulations launched, consumers have placed 30,000 fewer orders on the DoorDash Marketplace, with expectations that it will worsen and cause significant decline in revenue for Seattle businesses.
“We warned the previous city council that we would likely need to implement a new fee to help offset some of the costs of this unprecedented policy,” Doordash Public Affairs Communications Manager Parker Dorrough told The Center Square in an email. “Our hope is that the newly elected council will come to the table in search of a solution that works better for Dashers, merchants and consumers in Seattle."
Prior to the App-Based Worker Minimum Payment Ordinance being approved, Seattle City Councilmember Sara Nelson said that she was concerned that it could result in higher delivery fees, which would lower demand and result in unintended consequences, like reducing drivers income, as well as the revenue of small businesses like restaurants.
Nelson ultimately voted in favor of the bill in June 2022.
During the city council meeting on Tuesday, Nelson told workers who spoke on the new laws that they have been heard by the council, but city councilmembers “don’t know the path forward yet.”
