Food delivery services such as Grubhub, Postmates, and Uber Eats will face new limits on the delivery fees they can charge to restaurants under an order signed Monday by Monroe County Executive Adam Bello.
State officials have forced restaurants and bars to severely curb or halt outright in-person dining throughout the COVID-19 pandemic, leaving them with little choice but to offer takeout and delivery if they want to survive.
Many of the establishments, lacking delivery crews of their own, have relied on third-party services to get orders to customers. But at a cost: The delivery companies charge restaurants as much as 30% of an order’s purchase price.
The executive order that Bello signed on Monday will limit the charge to 15% of an order’s purchase price. The directive will last through the duration of the pandemic.
“Being able to order restaurant food for home delivery is an important part of our COVID-19 response, protects our public health and is an essential alternative to dining out,” Bello said in a news release. “Capping these fees helps safeguard the survival of local restaurants, provides much-needed financial relief and helps our small business owners make ends meet.”
Bello’s order matches a proposal submitted in November by Democratic County Legislator Rachel Barnhart. The Legislature’s Republican majority prevented a vote on the legislation.
During a brief interview Monday, Barnhart said limiting what well-financed tech companies can charge small businesses during a public health emergency is a way to afford local restaurants and bars some protection.
“This is really a case of big tech disruption in the way we order food, extracting wealth from the little guy,” Barnhart said.
Cities across the country, including New York City, San Francisco, Seattle, and Portland, Oregon, have placed caps on the fees that third-party delivery services pass on to restaurants. Onondaga and Albany counties have also capped fees by executive order.
The delivery services have opposed the fee caps, arguing that they'll hurt restaurants. Some have responded to the limits by skirting them with new fees charged to customers.
Jeremy Moule is CITY's news editor. He can be reached at jmoule@rochester-citynews.com.