Cleveland considers capping fees that food delivery services charge restaurants

Coronavirus

Fee caps aimed at Grubhub and DoorDash to help restaurants during pandemic

CLEVELAND (WJW)– While local restaurant owners urged lawmakers to pass relief measures as they struggle to stay open during the coronavirus pandemic, Cleveland City Council President Kevin Kelley took another step.

Kelley introduced legislation Wednesday that would limit the amount food delivery services could charge restaurants to 15 percent of the purchase price on delivery or pickup orders until they can return to full dining service.

“They’re getting charged upwards of 30 percent on top of the bill and that’s just making it very difficult to continue to compete,” Kelley said.

“All the different people in the food industry, we all need to help each other because we’re not gonna survive to the other end and there won’t be a delivery service because you won’t have enough restaurants to make it worthwhile,” said Andi Udris, owner and president of  Hofbräuhaus Cleveland.

Responding to the proposal, Grubhub told FOX 8 that fee caps are well-intentioned but counterproductive.

“They limit how restaurants – especially small and independent establishments – can effectively market themselves to drive demand, which severely impacts how many customers and orders we can bring to these restaurants,” Grubhub said.

“Pricing regulations could cause us to increase costs for customers, which could lead to fewer orders for local restaurants and fewer earning opportunities for Dashers,” a spokeswoman for DoorDash said.

Kelley’s bill would also prohibit a pay reduction for delivery drivers, as a result of the fee limit.

In 2019, there were nearly 600,000 restaurant and food service workers in Ohio, making up about 10 percent of the state’s workforce.

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