Working Washington, a worker’s rights lobbying group, is fighting to push a bill through the Seattle City Council that would establish minimum pay rates for app-based delivery and service workers in order to guarantee that they make the city’s minimum wage after adjusting for expenses and extra time required to complete certain jobs.
While they have national level data on just how little the on-demand food delivery workforce makes, Working Washington has collected data locally to support the proposed “PayUp” ordinance and released a report last week that breaks it all down.
Spoiler alert: It’s grim.
Without Seattle’s current pandemic hazard pay bonus of $2.50 per trip, many app-based delivery or task workers wouldn’t make much money at all. The average hourly pay for gig workers across on-demand apps in Seattle was just $9.58 per hour — slightly more than half of the current minimum wage. And DoorDash’s gamer-themed commercials aren’t the only cringe thing they’ve been up to: their average hourly pay is the lowest of any food or grocery delivery app in the Seattle area, clocking in at $7.97.
Of the big three food delivery apps in Seattle — UberEats, DoorDash and Grubhub — Working Washington’s report said, “Each of these platforms operates somewhat differently, but all of them pay well below minimum wage after expenses.” The per-delivery average payout was $6.62, which means deliveries would have to take about 20 minutes a piece, even before factoring in mileage and other expenses, to approximate Seattle’s minimum wage. The report estimated the average pay for all Seattle restaurant delivery app workers at $3.26 per hour without the $2.50 hazard bonus.
Food delivery apps have always been a bit of a Faustian bargain for restaurants in that they generally don’t bring new customers but do take a big cut of sales (15 to 20 percent, typically). Working Washington’s data hammer home just how much apps are leeching from everyone else involved. Customers pay more for their food while workers take on an extra tax burden and have an unreliable source of income, all in the name of convenience and flexibility.
“Customers are simply charged as much as possible while maintaining the sale, while workers are paid as little as possible to complete the job,” the report concluded. A succinct description of capitalism, of course, but that doesn’t make the situation any easier to accept.
The marketplace apps included in the report — TaskRabbit, Rover, and Handy — aren’t much better. While they all seem to pay slightly higher wages, many of them require quite a bit of mileage, customer communication, and other unpaid support work outside of the time that workers are actually paid for, bringing rates down below minimum wage. They often require workers to have their own tools, just as delivery apps require customers to use their own vehicles. The main theme of the report is that once all the expenses that are traditionally a business’s responsibility are factored in, seemingly generous up-front wages are anything but.
After seeing the data collected for the report, you might be asking why workers would accept offers that don’t make financial sense for them. That brings us to the section of the report that deals with acceptance rates.
All of the companies discussed in the report require — or effectively require — workers to accept a high percentage of jobs offered to them or risk losing work. Many companies also give employees an extremely limited amount of information about jobs and time to accept them, ensuring workers aren’t able to evaluate whether a job is worthwhile.
All of this adds up to a pretty unpleasant gig. Interviews with workers included in the report share a similar theme: On-demand workers are actually getting lower pay and less free time the more they come to depend on the app.
“I have to put in 70 or 80 hours a week just to get by. Each order only pays $4. Sometimes that doesn’t even cover our gas and mileage costs!” GoPuff worker Wei Lin told Working Washington.
Ma Hernandez, a DoorDash worker who said she needed flexible hours to take care of her kids and attend community college, reported making a little less than $1,250 in a month while racking up nearly $700 in job-related expenses.
“The pay is impossible to live on,” she said.
It’s been said plenty of times before, and it’s worth saying again here: the report’s findings are troubling because of who tends to depend on gig work the most. A Pew Research Center report from 2021 found that Black and Hispanic workers are overrepresented in the gig economy, especially in younger age ranges. If app-based work continues unregulated, it could further entrench existing racial wealth gaps.
While abolishing delivery apps might sound ideal after a read-through of this report, it’s unlikely that the toothpaste is going back in its tube. On-demand services, especially restaurant delivery, seem to be here to stay. Plus, given the ongoing threat presented by COVID-19, there are a number of immunocompromised individuals who have come to depend on restaurant and grocery apps for safe access to food. However, that drives home the importance of making sure that, like any other job, on-demand delivery and marketplace jobs pay at least minimum wage.
The report concludes, “Left unregulated and without accountability to basic labor standards, gig companies will tend to exploit their vast resources and data to drive workers’ pay down well below minimum wage, leaving a growing number of workers entirely excluded from basic protections.”
Tobias Coughlin-Bogue is the associate editor of Real Change News.
Tobias Coughlin-Bogue is the associate editor at Real Change.
Read more of the May 25-31, 2022 issue.