Seattle, Washington has now capped its third-party delivery commissions at 15%. (Photo: iStock)
Seattle officials have passed a measure capping all third-party food delivery service commissions at 15%, citing efforts to help restaurants amid COVID-19. The Washington city made the move to provide support for restaurants that are struggling to survive government-mandated social distancing restrictions, the Seattle Times reported.
The new cap has been in effect since Friday and will remain until the city’s restaurants are again permitted to open for unrestricted dine-in services. Violations of the new measure are misdemeanors prosecutable by the Seattle City Attorney’s Office.
Additionally, the emergency order mandates that the entire amount of tips go to delivery drivers, who often can’t obtain federal unemployment benefits as they are deemed “independent contractors.” In fact, the new measure makes it a crime for third-party delivery company’s to cut drivers’ pay, as well.
Since March, Washington has ordered all restaurants to shut their dining rooms, forcing many to rely on delivery and carryout for all their business, which most businesses turned to third-party delivery services like DoorDash and GrubHub to provide.
After complaints that commissions were upwards of 30% of the orders’ total charge, many restaurateurs complained to the city. In fact, San Francisco has already capped commissions at 15% with New York and Chicago also considering similar measures.