Doordash, Uber Eats and Grubhub have launched lawsuits against New York City in a last-minute bid to block its $17-an-hour minimum wage law for food delivery workers which comes into force next week.
The trio of tech giants is among those warning that the new minimum wage - up from an average of $7.09-an-hour currently paid to couriers - will also trigger a rise in fees for consumers and destroy restaurant businesses.
Their lawsuits mark an escalation of tensions between employers and the city's administration over how the industry should be regulated.
Coming into effect on July 12, the new law would almost triple average earnings for the Big Apple's 60,000 app-based delivery drivers over the next few years.
New York Mayor Eric Adams touted the new law as paving the way for 'greater economic stability' for gig economy workers as well as keeping the city's 'legendary restaurant industry thriving'.
DoorDash Inc, co-founded by Tony Xu who is also the chief executive, is among the companies taking legal action against New York city administration over the minimum wage law
But delivery companies have said the law is based on a misunderstanding of how the gig industry operates, and warned costs will impact restaurants as well as consumers.
DoorDash Inc and Grubhub Inc filed joint proceedings in the Supreme Court of New York on Thursday opposing the law, while Uber Technologies Inc and Relay Delivery Inc each filed separately.
New-York based Relay said the law would put it out of...
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