Federal Judge OKs NYC Law Requiring Food Delivery Apps to Prompt Customers for Tipping Before Checkout
A New York City law requiring food delivery apps like Uber Eats and DoorDash to offer customers a tipping option before checkout has been given the green light by a federal judge. The decision means the ordinance is set to take effect on Monday, aiming to protect workers' earnings after tips plummeted following the implementation of a new minimum wage law in late 2023.
The law's introduction forced delivery apps to prompt customers to tip before checkout, with a default suggestion of at least 10%. City officials say this change was necessary as the new wage policy dramatically boosted earnings for app-based delivery workers, increasing their pay by around $1.2 billion overall. However, this move also sparked backlash from delivery companies like Uber and DoorDash.
Those companies argue that the law effectively strong-arms customers into tipping upfront, undermining the traditional concept of gratuity as a reward for good service. They claim that pre-tipping functions less like a thank-you and more like a requirement to secure delivery at all, since drivers can see the expected payout before accepting an order and routinely skip low- or no-tip jobs.
Critics counter that the city's ordinance fuels resentment, tipping fatigue, and higher prices β while distorting the relationship between customers and workers. However, regulators say the law quietly led DoorDash and Uber to redesign their tipping systems in ways that wiped out hundreds of millions of dollars in gratuities.
According to a January report from the Department of Consumer and Worker Protection, DoorDash and Uber shifted tipping to after delivery following the city's minimum wage policy, resulting in an estimated $550 million drop in worker tips.
A New York City law requiring food delivery apps like Uber Eats and DoorDash to offer customers a tipping option before checkout has been given the green light by a federal judge. The decision means the ordinance is set to take effect on Monday, aiming to protect workers' earnings after tips plummeted following the implementation of a new minimum wage law in late 2023.
The law's introduction forced delivery apps to prompt customers to tip before checkout, with a default suggestion of at least 10%. City officials say this change was necessary as the new wage policy dramatically boosted earnings for app-based delivery workers, increasing their pay by around $1.2 billion overall. However, this move also sparked backlash from delivery companies like Uber and DoorDash.
Those companies argue that the law effectively strong-arms customers into tipping upfront, undermining the traditional concept of gratuity as a reward for good service. They claim that pre-tipping functions less like a thank-you and more like a requirement to secure delivery at all, since drivers can see the expected payout before accepting an order and routinely skip low- or no-tip jobs.
Critics counter that the city's ordinance fuels resentment, tipping fatigue, and higher prices β while distorting the relationship between customers and workers. However, regulators say the law quietly led DoorDash and Uber to redesign their tipping systems in ways that wiped out hundreds of millions of dollars in gratuities.
According to a January report from the Department of Consumer and Worker Protection, DoorDash and Uber shifted tipping to after delivery following the city's minimum wage policy, resulting in an estimated $550 million drop in worker tips.