Order tracking since Jan. 13 shows unprecedented new law backfiring for merchants, customers and workers it was supposed to help
Data released today shows Seattle’s new App-Based Worker Ordinance has already cost Seattle workers 30,000 new orders and local businesses over $1 million in lost revenue – all within just two weeks of taking effect.
New data collected by DoorDash finds a significant drop in both orders and deliveries since the Seattle Earning Standard took effect on Jan. 13. Fewer orders are leading to fewer earning opportunities for app-based delivery, waiting an average of three times longer in between offers, according to the initial data. The new law is making it harder for app-based workers in Seattle to retain the flexibility, earning potential and independence that once attracted them to this work.
Under the new law, app-based workers are guaranteed to make well above Seattle’s minimum wage: approximately $26.40 plus tips and mileage for delivery. Proponents for the ordinance said the policy would protect app-based workers and guarantee them more pay. In reality, the ordinance they championed has had the opposite effect, resulting in fewer delivery orders for merchants, lost revenue, and a drop in order volume for delivery workers.
“The data is clear: this ordinance is not working. In fact, it’s having a detrimental effect on businesses, workers and customers – especially those who depend on delivery for health and safety reasons. Those customers are among the most impacted by this new law and the associated increases in cost,” said Tammie Hetrick, president and CEO of the Washington Food Industry Association. “Digital sales are down roughly 10-12% for independent grocers, including many small, family-owned businesses. This represents about a 1.5%- 2% reduction in online sales, which might not sound like a lot but we are a high volume retailer and the dollars are significant,” she added.
“The Seattle ordinance was not thought out, it was rushed into place and now we’re seeing the direct consequences of those actions. The new council needs to take a close look at this and, hopefully, repeal the law. We’re barely a month into implementation and it’s already having a dramatic, negative impact.”
Marcos Wanless, founder and president of the Seattle Latino Metropolitan Chamber of Commerce, said the council was warned about the unintended consequences of the ordinance before it was approved.
“We were clear with the council from the very beginning: this is untested, it is extreme, and it is going to hurt both workers and merchants in the city,” said Wanless. “Customers are also frustrated that they have to pay so much more now. It is to the point that it is pricing people out – especially the elderly, people with disabilities, working families – who need access to delivery services for everyday shopping and grocery items,” he added. “Our members are very concerned that if this continues, it will hurt their businesses – especially restaurants, who rely on app-based deliveries to reach new customers. This is unsustainable for the city, from a long-term perspective.”
“This is just devastating for our retailers in Seattle,” said Renée Sunde, president and CEO of the Washington Retail Association. “Small businesses have come to rely on app-based delivery workers to help grow their customer base, especially since the pandemic. This new ordinance feels like a tremendous step backwards for merchants, workers and customers. We would encourage the new council to examine the impact this law has already had in such a short time, and seriously consider a repeal.” she said. “We need policies that lift up merchants and workers and customers. This is clearly having the opposite effect. ”
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About the WA Alliance for Innovation and Independent Work
WA Alliance for Innovation and Independent Work is a coalition of consumers, independent workers, small businesses, app-based services, and community leaders from across the state that seeks to strengthen and support advancements in the new workplace. Today, flexible jobs, benefits, and innovative services are essential to enhancing Washington’s emerging economic opportunities and empowering the small businesses and workers who are leading and innovating.