DoorDash and Grubhub Are Exploiting Delivery Drivers and Local Restaurants

Photo by Andrea Davis on Unsplash

Written by: Ryan Fan

On April 29th, 2020, Giuseppe Badalamenti, a Chicago restaurant owner, released a summary of his March deposits through Grubhub. He sold almost $1,100 in orders, but only made less than $400 on his food.

The fees that Grubhub took out of Badalamenti’s restaurant were ridiculous, and yet restaurants aren’t the only ones being shortchanged by third party food delivery services, taking more than 20% of what a driver makes from a delivery — which can result in a driver making far less than minimum wage.

It is also delivery drivers, who put themselves at health risk every day, who are being shortchanged by the companies’ share of every delivery.

The reality leaves drivers largely dependent on tips for income — a reality that no gig economy worker wants to face.

I drove Uber and Lyft before the pandemic, and unfortunately had to stop given my family members’ compromised immune systems. I will distinctly remember rides where the rider paid $8.50, and I only made $3.50. The amount that the rideshare companies took out of each ride was ridiculous.

Look, gig economy third-party food delivery services are very valuable. They give restaurants more business and give consumers options to support their local restaurants during this time of intense desperation and field their food options. Without a doubt, using services like Grubhub, DoorDash, and Uber Eats as a restaurant allows greater presence in the market and gets more business. They give a convenient and accessible option for people who can’t cook and need to eat, as well as explore the best options.

But Grubhub, DoorDash, Uber Eats, and other third-party food delivery services don’t need to be so greedy. I understand that they are businesses and do what they need to survive, and I’m not speaking from a moralizing perspective, but being a kind and altruistic employer that allows restaurants and drivers to earn more would be more beneficial to gig economy companies than taking as large of a commission share as they are.

A good business is not a parasite, and food delivery companies like Grubhub and DoorDash can do better by its workers than rideshare companies like Uber or Lyft. I can speak from a gig economy worker’s experience that I would respect the company that allows me to keep a large portion of what a customer pays without interference, and I would recommend my friends work for the same company.

With workers as independent contractors for the most part, I understand how it can be very unstable for drivers to work without adequate health care and insurance, especially in the middle of a pandemic. The only way third party food delivery services can make up for that liability is by allowing customers and restaurants to be paid more.

Grubhub, DoorDash, and Uber Eats would certainly benefit from more restaurants and more demand from consumers. It would benefit from more drivers willing to put in the work for the company, and developing that kind of brand loyalty is what is absent for so much of the gig economy today.

If a delivery driver or restaurant employee is putting their health and even their lives at risk, shouldn’t they be rewarded for doing so? Shouldn’t a good business allow its workers and patrons a livable and suitable wage? Shouldn’t it put more money in the hands of its workers and restaurants instead of its own CEOs?

I hope that third-party food delivery companies can be the exception to norm in the gig economy, especially during a pandemic. Because if not now, when is it time for these companies to adequately serve their employees and customers?

This post was originally posted on Medium.