State regulator says Grubhub’s stiff fees could be illegal

A New York regulator said third-party food-delivery companies like Grubhub and Uber Eats appear to be breaking state laws by charging restaurants stiff fees that are based on a percentage of their orders.

During an at-times testy hearing in Harlem on Monday, the New York State Liquor Authority’s chairman, Vincent Bradley, likewise brushed off concerns that a controversial proposal to cap those delivery fees at 10 percent would make things impossible for delivery services.

“At the end of the day, if they fail because of this, then they were probably going to fail anyway,” Bradley said.

Critics including New York City council member Mark Gjonaj have blasted delivery companies for taking commissions as high as 30 percent of the bill for delivering everything from burgers to dim sum — a punishing pound of flesh for most mom-and-pop eateries, he contends.

Grubhub has countered that it brings “incremental” business to restaurants, including more profitable patrons who come and sit down for dinner.

Whatever the case, the state liquor board on Monday signaled that these companies will either have to comply with a 10 percent ceiling on fees or charge flat rates instead.

Source: New York Post

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