A law set to take effect next week would decrease demand for couriers and cost companies, they say
Delivery-app companies sued New York City on Thursday over a law that requires them to start paying tens of thousands of delivery workers a minimum wage starting next week.
DoorDash (DASH), Uber (UBER) and Grubhub filed lawsuits against the city, which announced the law last month. It mandates that delivery workers must be paid $17.96 an hour without tips by July 12, and at least $19.96 an hour by 2025 -- above the city's minimum wage for other workers.
The companies are taking issue with the fact that the law requires them to pay the workers, whom they consider independent contractors, for the whole time they're logged into the apps. That's a departure from the usual way the companies pay the workers, which is from when workers first accept a delivery until they deliver it.
Unless courts block its implementation, the law would be the first of its kind to take effect in the nation. Seattle passed a minimum-wage ordinance for delivery workers last year, but it doesn't take effect until next year.
In its lawsuit filed with the Supreme Court of New York, Uber said it would suffer "irreparable harm" if the law were to stand, in that it would "have to pass the increased costs of the Challenged Rule on to consumers" and "divert significant product and engineering resources away from planned projects and towards building new technologies to restrict courier access" and to comply...
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