Council heard last week from two restaurants and a representative of the Ohio Restaurant Association who said the tech companies charge restaurants as much as 30% of the bill to deliver food while discouraging their clients from raising prices. With consumer demand for delivery spiking in the pandemic, restaurants owners say the delivery fees can be greater than the profits on some of their meals.
Akron City Council says that this law would let restaurants keep more of their sales through DoorDash, GrubHub, Uber. “We believe it’s in the city’s best interest, along with major cities throughout Ohio and the country," said At-Large Councilman Jeff Fusco. "This is a good way to go in terms of protecting the citizens of Akron."
DoorDash and GrubHub told the Beacon Journal last week that capping the commission rates would hurt the restaurant industry by decreasing demand for deliveries because drivers would make less tips with fewer orders. The companies cited private studies in cities with caps but did not provide data to backup their claims.
The companies use revenue from online orders to market their clients' menus and pay drivers. The legislation passed by council prohibits the companies from cutting their drivers' hourly wages. The new law will be in effect until 120 days after the state lifts public health orders limiting restaurant capacity. At that time, city lawmakers could entertain whether to keep the 15% cap indefinitely.
“When it comes time for it to expire, I think we should look at whether it is something that should remain in place, post-COVID when things are normal," said Ward 8 Councilman Shammas Malik, who suggested that the body study the economic impact in Akron and elsewhere before making that decision.
