Following the trend of other Bay Area cities, the Santa Clara City Council moved Tuesday to cap food delivery fees.
The temporary ordinance caps fees from third-party companies – think Uber Eats, DoorDash, GrubHub, and Postmates – at 15%. Restaurants have complained that delivery service charges have been eating increasing shares of their revenue.
“Several restaurant owners told me they are facing fees as high as 30% from these third-party food delivery apps,” said Santa Clara Mayor Lisa M. Gillmor, in a statement.
This comes as the COVID-19 pandemic has pushed more local eateries to offer delivery, often for the first time.
“[They] have no choice but to pay these fees due to their current reliance on delivery orders,” Gillmor added.
The ordinance takes immediate effect, and lasts until the end of the pandemic. It also prevents the delivery companies from taking from driver gratuities. Thirdly, it increases price transparency for customers by requiring delivery companies to disclose more information.