Fees temporarily capped for food delivery services
Restaurants and hospitality businesses that are experiencing unprecedented challenges during the COVID-19 pandemic will be provided with immediate relief from the fees charged by food delivery companies, the Ministry of Public Safety and Solicitor General announced today.
“Local restaurants and businesses play a vital role in our communities, and they have experienced a significant decline in sales and traffic due to the COVID-19 pandemic,” said Mike Farnworth, Minister of Public Safety and Solicitor General. “Capping food service delivery fees is another way our government is providing immediate relief to our local businesses to ensure they can focus on retaining staff and keeping their business running.”
An Emergency Program Act (EPA) order has been created to place a temporary cap on fees charged to restaurants from food delivery companies to 15%. An additional cap of five per cent is also included for other related fees associated with use of the service, such as online ordering and processing fees. This will ensure that companies cannot shift their delivery costs to other fees.
“The pandemic has had a significant impact on the restaurant industry, leaving many owners to find safe and sustainable ways to keep their business operating,” said Ravi Kahlon, Minister of Jobs, Economic Recovery and Innovation. “This includes moving their menus online to accommodate the surge in home delivery. To help support B.C. restaurants, this temporary cap on food delivery fees is further action our government has taken to aid local restaurants and keep more British Columbians employed.”
The EPA order, which was made on Dec. 22, will be in place until three months after the Provincial State of Emergency is lifted.
Following consultation with stakeholders, including meetings with Adam Walker, Parliamentary Secretary for the New Economy, the province has ensured the order will exempt small delivery service businesses that are often locally based. The EPA order will also ensure that delivery companies cannot reduce compensation or retain gratuities from their drivers, allowing workers to be paid their regular wages.
“In consultations, I was encouraged to hear from food delivery companies who expressed support for a fee cap that has no impact on driver wages,” Walker said. “During this time, we all understand the need to strike a balance between supporting businesses in the new economy while still ensuring that delivery drivers are fairly compensated for the work they do.”
The EPA order will be implemented on Sunday, Dec. 27, to allow companies to adjust to the new rules.
“B.C. restaurants and hospitality businesses have suffered difficult losses during this pandemic and are in need of immediate relief and support. This cap on food service delivery fees is tremendous news for our sector, and represents another tangible way that this government is helping restaurants weather the storm of COVID-19. On behalf of the entire industry and our over 190,000 employees, we thank the government for their proactive and common-sense approach. This is truly an early Christmas miracle,” stated Ian Tostenson, president and CEO, BC Restaurant & Foodservices Association.
In September, B.C. employment in food services and drinking places was 150,260. This is 25% below September 2019 (200,110) and 20% below February 2020 (188,470).