New York City Amends Food Delivery Fee Caps

New York City has enacted a new ordinance lifting pandemic-era caps on restaurant delivery fees, following a settlement with major food delivery platforms. The City Council passed the bill in April 2025, allowing companies like DoorDash, Grubhub, Uber Eats, and Relay to charge restaurants up to 43% in total fees, up from the previous 23% cap.

Details of the New Fee Structure

The new law outlines a detailed breakdown for these charges:

• A 15% cap for core delivery services.

• A 5% cap for basic marketing and platform visibility.

• A 3% cap to cover credit card processing fees.

• An additional 20% for enhanced services, which include expanded delivery radii and various promotional offerings.

Settlement and Rationale

This legislative adjustment is a component of a broader settlement agreement. Under this agreement, the involved delivery companies have committed to withdrawing lawsuits previously filed against the city. These lawsuits contested both the original fee cap law and a separate minimum wage law for delivery workers, arguing that the fee caps were unconstitutional and resulted in substantial financial losses for the platforms.

City officials and industry representatives have stated that the new ordinance aims to achieve a balance. It seeks to safeguard restaurants from excessive charges while simultaneously enabling them to invest in marketing services to broaden their customer reach. Councilman Rafael Salamanca, who sponsored the bill, characterized it as "a long-overdue compromise that serves as a major win for local restaurants and consumers."

The ordinance is scheduled to become effective 30 days following its passage, providing restaurants and delivery platforms with time to adapt to the revised fee structures.