On Friday April 26th I co-hosted a courier consultation forum at Cornell University’s Worker Institute, in collaboration with the Institute’s Director of Labor and Policy Research, Dr. Maria Figueroa. The forum built on my research on the opportunities and challenges of platform-mediated “on-demand” food delivery work in New York City (see also this previous workshop), welcoming stakeholders from the public and private sectors to consult with food delivery workers about what can be done to improve their working conditions and to develop labor standards in this emerging industry. Our primary aim was to raise awareness among legislators, policymakers, and labor organizers, and to stimulate a robust discussion centered on the following questions:
How can on-demand food delivery platforms improve the working conditions and income opportunities of their courier fleets?
What new government policies would be needed to help improve labor standards in this industry?
We organized this forum because platform-mediated food delivery work, despite its growing prevalence, is still understudied, underrepresented, under-regulated, and generally ignored – especially in the United States. Whereas Uber and Lyft drivers have recently received significant attention and institutional support, leading to new ride-hailing regulation in New York City that has set a driver cap and a minimum hourly wage, no such regulatory initiatives or protections exist for food delivery workers – nor are they forthcoming. While there are currently about 70,000 app-based drivers in NYC, there are likely as many (if not more) food delivery workers operating in all five boroughs, many utilizing multiple apps to make a living. Unfortunately, however, there are no reliable numbers that could give insight into the exact size of this expanding workforce, and there is likewise very little knowledge about the working conditions of bike couriers and delivery drivers who have signed up with companies like Caviar, Postmates, Grubhub, Relay, or Uber Eats. Still, one thing I have learned during my time in the city (February – August 2018) is that the income opportunities of app-driven food delivery workers have been deteriorating over time: what used to be a really good gig only a few years ago is nowadays becoming increasingly precarious and unsustainable.
This is one of the reasons why we wanted these companies to join the forum and participate in the discussion, in an effort to hold them accountable and get their perspective on the situation, but unfortunately none of the invited companies showed up. Despite their physical absence that Friday, some of these companies have nevertheless secured their presence in legislative debates through their extensive lobbying activities, which also target New York State’s Department of Labor. This is why it was so important to us that legislators and policymakers get to hear from those who actually deliver the food and generate the data for platform companies that continue to disavow most responsibilities for their workforce. This forum was all about getting their side of the story.
By the time we got started the large table had been slowly crowding with participants representing various organizations and institutions. Next to seven couriers, most of whom I had met during my fieldwork last year, there were representatives from NYS’s Department of Labor (DOL), NYC’s Office of Labor Policy & Standards (OLPS), NYS’s AFL-CIO, Local 32BJ of the Service Employees International Union (SEIU), United Food and Commercial Workers (UFCW), NYC’s chapter of the Restaurant Opportunities Centers United (ROC United), Make the Road NYC, the Independent Drivers Guild (IDG), and the National Domestic Workers Alliance (NDWA). Because the group was quite large we decided to split up into two breakout groups for an initial consultation session, after a general introduction to the event. In the group I moderated, it first became apparent that there was a need among participants to get some basic information regarding the labor process of platform-mediated food delivery: they wanted to know how things actually work and what it’s like to be a courier operating via an app. As it turned out, things did not work as people had imagined.
Diversity and volatility
One thing that the participating couriers wanted to convey is that not all companies manage their courier fleets in the same way and there is quite some variety in terms of how the work of food delivery is organized. For instance, while some companies (such as Uber) technically allow their “delivery partners” to work anywhere and at any time they want, GrubHub and Relay use a zone-based self-scheduling system that grants priority access to couriers with the best performance metrics (e.g. Order Acceptance Rate and Attendance Rate). In this way, these companies make it costlier for couriers to skip shifts or to reject as many order as they want – a key prerogative when you’re an independent contractor – and thereby exercise more control over the labor process, which raised some eyebrows in the room. Moreover, couriers told us that each company regularly changes how it presents its offers via the app and how it determines its base pay and bonus incentives, while also continually updating the apps’ functionalities and other elements that affect the labor process. This lack of consistency is what often makes it so difficult for couriers to depend on a single app (or company) to generate enough work and earnings, while it also hinders the development of a stable work routine and preempts any definitive conclusions regarding which company treats its couriers better than others. Indeed, it was this experience of volatility and perpetual change that the attending couriers identified as one hallmark of this job, something that pertained to all companies operating in NYC.
An issue that came up early in the discussion was wait times at restaurants and the low remuneration couriers receive for waiting until the order is ready. Waiting for orders is a regular feature of this work, especially when doing deliveries for Caviar or Grubhub, yet Caviar only begins paying couriers around $0.10 per minute after they have already waited for 10 minutes (during which they are not remunerated) and Grubhub does not offer any wait pay despite dispatching couriers at the same time as they place the order with the restaurant – which often leads to long wait times. The couriers at our table agreed that these companies should improve their system so that they wouldn’t have to wait longer than a few minutes (at most) for the order to be ready, because this is “dead time” for which they are not, or hardly, getting paid. More generally, they wanted higher wait pay from all companies. Although one Courier appreciated that Caviar now offers a $8,50 minimum payout for each order, he reasoned that this does not mean much if you cannot complete at least two orders per hour, otherwise you’d be making less than minimum wage (keeping in mind all the expenses couriers are responsible for as independent contractors). And if you have to wait around 20 minutes for each order to be ready, even this minimum wage threshold becomes hard to reach.
Besides wait times, an important issue that came up at length in our breakout session was the various problems couriers have been experiencing with respect to tips. Although they could not prove it definitely, couriers shared stories about how they or their peers have in the past not received the tips they believe they earned, particularly when orders placed via Grubhub or Seamless were handled by Postmates or Relay. Any tips customers added to their bill were in these cases – allegedly – not transferred to the courier delivering the order, and over time people became suspicious as they never received any tips on orders coming from particular restaurants. When one of the attending couriers raised critical questions about this in a Facebook group that was monitored by Postmates employees, he was subsequently deactivated. After hearing this story, an official from NYS’s Department of Labor called this a clear example of retaliation and was very interested in learning more (contact info was exchanged afterwards).
A more concrete and high-profile tip-related issue that was discussed concerns the way DoorDash uses tips to subsidize the guaranteed amount it pays its “Dashers”. Although some of the participating couriers were generally happy with the guaranteed amounts that DoorDash had recently been offering, they also realized – and explained to those at the table who weren’t yet aware – that much of this money consisted of customer tips. The higher the tip, the less DoorDash contributes to the guaranteed amount, essentially turning the tip – which is supposed to be an extra – into the base payout. DoorDash’s minimum contribution is as low as $1 and only if the customer doesn’t tip or tips poorly will the company increase its contribution in order to pay the guaranteed amount. (As this was explained, I saw some jaws drop and eyes roll around me. One city councilmember from the Bronx – who unfortunately couldn’t join our forum – is currently seeking legislative measures against this practice.)
Meanwhile Caviar has introduced a new way to present its delivery offers via the app, which bases a courier’s “expected earnings” on the “expected customer tip” that is calculated as a percentage (allegedly 15%) of the total order amount. However, when customers do not actually tip this amount, couriers receive a (sometimes significantly) lower payout than the “expected earnings” that informed their decision to accept the order in the first place. This happens frequently, some couriers pointed out, as tips have generally decreased over time, at least in part because many companies charge customers a service fee that doesn’t contribute to the courier’s wage. In this way, customer tips are structurally disincentivized.
One other major issue that was raised during the breakout session pertained to the importance and volatility of bonus incentives. All attending couriers agreed that available bonuses are central to their decision to work for a particular app and to a large extent determine their work strategies, mainly because the base payouts have decreased significantly over the past years. Whereas bonuses – much like tips – used to be a nice extra, they now are the main reason to come out to work and they constitute a large part of couriers’ earnings. While chasing an order target (stipulated in the terms and conditions of a particular bonus incentive, for instance: earn a $10 bonus for every three deliveries; or earn a $150 bonus for doing 80 deliveries between Friday 11am and Sunday 8pm), one courier described his state of mind as “all adrenaline, maximize everything”, which he admitted led to some unsafe behavior. While companies urge their couriers to “ride safely”, they nevertheless also send push notifications with announcements like “it’s raining orders!” during inclement weather conditions (this is an example from Caviar) and it is common knowledge that bonuses are usually higher when bad weather makes the work more dangerous than it already is. The fact that couriers generally lack proper accident or health insurance makes this situation all the more problematic. (Although Caviar does now offer accident insurance – after one of their couriers died in a highly publicized accident – the attending couriers knew of at least one case in which a peer had his claim dismissed after getting into a bad accident.)
The biggest problem with bonus incentives, according to the couriers, is that they are increasingly difficult to reach and that they are continually changing. Companies can and indeed do regularly adjust the kind and size of their bonuses based on market demand, taking away some incentives and substituting them for others. This, they concurred, made it hard to know what to expect during any given week. The window of time during which couriers have to complete the order target is also relatively small, especially considering that there are hours when there are hardly any orders coming in. Add to this the fact that a lot of these companies are over-hiring to secure enough labor supply at all times and that bonuses get large numbers of couriers on the road, and it is not difficult to understand why many of them are not able to reach their targets. Not reaching your target means no bonus, which means a lot less money than you were counting on while chasing the target and accepting each order no matter how poor the payout (and some couriers indeed asserted that base payouts tend to decrease when they are working toward a bonus, so that they effectively subsidize bonuses with their own earnings).
Participant responses and suggested ways forward
After the breakout sessions the two groups reconvened at the large table and now it was time to gauge the responses from public officials and labor organizers: what were their main concerns and takeaways after consulting these couriers about their experiences, and how could labor conditions in this industry be improved? A representative from NYC’s OLPS stated that there was a clear need for more transparency, not just with respect to how couriers are paid and how tips are processed but also regarding how/to what extent their conduct on the platform is subject to control and can lead to either rewards or disciplinary measures. (The latter topic had previously come to the fore when couriers shared stories about not getting any orders for about half an hour, after having rejected many offers consecutively. Nobody knew with certainty whether this “freezing” of their account was a coincidence or a form of punishment, but many couriers had similar experiences.) Despite the fact that such transparency forms a prerequisite for meaningful regulatory measures, the assembled group unfortunately failed to determine ways in which food delivery platforms could be forced to provide more openness and clarity.
Meanwhile, representatives from NYS’s DOL appeared to be more interested in further investigating the level of control these platforms are exercising over their workforce. One representative admitted that he was taken aback by the extent and sophistication of app-based control over the working conditions and revenue stream of independent contractors engaged in platform-mediated food delivery. This meeting, he said, really opened his eyes because he had no idea what was going on in this industry and he seemed eager to learn more, asking couriers directly to send him screenshots and other materials. He was also interested in forms of retaliation which he recognized in some of the stories relayed that afternoon, mentioning that NYS’s DOL does not only focus on wage enforcement but also pursues retaliation cases. Still, more concrete proof – beyond anecdotal evidence – would be needed in order to start a case. Beyond control and retaliation concerns, the DOL also asserted that health and safety issues are rather significant in this industry and that the government does a lot of work in this area in NYC, albeit in the context of employment relations. It remains to be seen how much can be done for independent contractors, which brought the discussion back to employment status and misclassification. While everyone in the room appeared to agree that these couriers were being misclassified, nobody was able to propose an innovative and impactful way forward on this issue. Ongoing litigation seemed to be regarded as the best option, despite the rather mixed results of recent efforts, as NYS’s DOL did not seem ready to pursue legislative changes.
Beyond litigation, legislation or policy, some suggested ways forward included: starting a grassroots publicity campaign against one company’s malpractices and getting not only the press but also customers and restaurants involved; organizing a strike similar to the one that was being organized by Uber drivers in various cities ahead of Uber’s IPO; founding a cooperative that could offer a worker-owned alternative to corporate food delivery platforms; and joining a union that could provide institutional support and resources in the fight for better income opportunities. The UFCW representative stressed the fundamental need to build workers’ bargaining power in this industry, although this immediately prompted the question of who to bargain with because most couriers work for/with two or more companies simultaneously and regularly switch between apps. This is why the IDG representative, following his organization’s approach in the ride-hailing industry, emphasized that all efforts should be directed at achieving industry-wide agreements about labor standards. It is not enough, he asserted, to focus on one single company when most issues – as we had heard this afternoon – are prevalent on all food delivery platforms.
Ultimately, the precondition for all of the suggested ways forward is an organized workforce. Compared to Uber and Lyft drivers, however, the tens of thousands of app-based food delivery workers in NYC are more isolated from each other since, among other reasons, they lack any institutional support that could collectivize them. Couriers repeated how difficult it was to meet one another in person, let alone to actually organize something like a campaign or a strike. While many of them frequently exchange experiences and keep each other updated in various Facebook groups, there appears to be little readiness to make a real effort and build something among the critical mass. There have been several attempts to self-organize in the past, but each of them imploded not long after taking off. This is where the attending union and worker center representatives could be of real value: thus far ROC United has not made any serious effort to organize food delivery workers, but there seemed to be a genuine interest to change this as the forum drew to a close. It was suggested that ROC United could perhaps team up with Make the Road, which has recently been highly active in the fight to end the city’s criminalization and structural harassment of food delivery workers using e-bikes. Although these campaigns have not yet targeted the platform companies that depend on these couriers to take on high volumes of orders while refusing to take any responsibility for fines or confiscated bikes, collaborative avenues may soon open up to address these companies’ complicity and silence.
I believe that our first courier consultation forum has primarily been useful for these purposes: to raise awareness about the working conditions of those engaged in platform-mediated food delivery work and to provide a platform for public officials and labor advocates to meet each other and, where possible, begin coordinating next steps (however tentative). I am certainly not under any illusion that major transformations are imminent, given the massive political power imbalance these groups are facing, but I still remain hopeful that change is possible – with or without the cooperation of food delivery platforms. The truth is that, aside from worker organizing, achieving the kind of innovative regulation that NYC has rolled out in its ride-hailing market requires sufficient political will. Only when both of these preconditions have been met can a city-wide courier cap and an attendant minimum wage become a reality. Until then, smaller goals will have to be formulated and I hope that a next courier consultation forum can take on this challenge.