So Here’s The COVID Dichotomy...

The Lempert Report
December 03, 2020

Food delivery convenience vs. workers’ conditions

Food delivery workers have been called essential during the pandemic, but they have seen their working conditions get worse as the companies like Uber Eats, Door Dash and others are making a fortune. In fact, on Monday Door Dash said it plans an IPO that will sell 33 million shares and push the valuation of the company to, they hope, $32 billion.

These drivers, who bring food from restaurant to customers have fed many people across the US who don’t want to wander outside their front door, are in areas that have shuttered restaurants and are working from home and can’t get up from their makeshift offices and head to the kitchen to make lunch.

The New York Times has a terrific must read about the situation.

Obviously, because of the recent surge in cases these workers have a greater risk of exposure, they write. Also they report that there is a rise of assaults and bicycle theft.

Some workers told the Times that many restaurants deny them the use of their bathroom out of health concerns, forcing them to carry plastic bottles.

Proposition 22, as we reported last week, could have changed all that by making these gig workers employees that make a fair wage and offer benefits. And that didn’t pass because of terrific advertising.

So here is the dichotomy: the food delivery companies have seen sales surge, the workers’ pay has remained erratic says the Times. Because the drivers are independent workers, they are not entitled to a minimum wage, overtime or any other benefits, like health insurance. Undocumented immigrants, who are not eligible for unemployment or federal coronavirus assistance, make up the bulk of the work force in New York.

And then there is the competition for these jobs, as more people are out of work due to the pandemic. We have all seen these companies, including those that make deliveries from supermarkets hiring 100,000s of thousands of workers.

In NYC pre-Covid it is estimated that there were about 50,000 restaurant delivery workers – no one knows the exact amount now – but Uber Eats alone added 36,000 drivers since March.

DoorDash, the nation’s largest food delivery app, told the Times it provided masks, gloves, hand sanitizer and wipes to drivers, as well as access to low-cost telemedicine appointments.

DoorDash also said it had changed its pay model, which came under fire last year after it was revealed that tips were being used to subsidize its payments to workers. But workers interviewed for the Times article said the practice still occurred. The company recently reached a $2.5 million settlement with prosecutors in Washington, D.C., after being accused of misleading consumers over how it tipped its workers.

Just how bad is the inequality? The Times interviewed Edgar Usac, a delivery driver, who said that after four hours of waiting to receive an order, he had made $11. Another driver, Elias Pacheco, 35, said: “I have made $32 so far. I started at 10:30 this morning.” It was 5 p.m.

Drivers for food delivery apps are typically paid per delivery depending on the estimated duration and distance of a trip, plus tips.

“The pandemic really exacerbated the challenges that these workers are facing and that they regularly face,” said Maria Figueroa, director of labor and policy research for the Cornell University Worker Institute. “In addition to getting low pay, they don’t get enough work from each of the applications, so they have to work for at least three or four of them, and there are more workers than the market can hold.”

As these companies like Door Dash and Instacart prepare for their IPOs we hope to get a clearer picture of just what is going on and how to help to understand just what is going on with this new workforce.

By the way, the New York City Taxi and Limousine Commission two years ago adopted a $17.22 per hour minimum wage for drivers for ride-hailing apps like Uber and Lyft, but it does not apply to delivery workers.