There may be big changes coming soon to restaurant delivery in Seattle. A newly proposed city council bill would require that all third-party food delivery platforms have a written service agreement with a restaurant prior to placing them on their apps, something that has not always been the case when it comes to the likes of Grubhub, Uber Eats, and DoorDash.
Per the proposed bill, restaurants can end the contract at any time through a written request — the app company would then have to remove the restaurant from its platform within 72 hours. Penalties for noncompliance would be $250 per infraction, and restaurants would have the right to sue delivery apps (individually or as a class) for violations. Revenue for any penalties would go toward supporting small restaurants in Seattle (those with five or fewer employees).
Seattle’s legislation is modeled closely after a similar bill that passed recently in California, which requires third-party delivery companies to remove any non-partnered restaurants from their apps. That law was enacted after Pim Techamuanvivit, the owner of San Francisco’s Michelin-starred Thai restaurant Kin Khao, detailed the issues she had with GrubHub, Seamless, and other apps listing food purportedly from her menu without her permission in January 2020. Not long after Techamuanvivit’s complaints, Seattle’s own high-end restaurant Lark ran into problems with Seamless — the app listed the Capitol Hill destination on its app, even though Lark doesn’t do takeout or delivery.
Third-party apps often list restaurants that they don’t have official agreements with in an attempt to keep up with the competition. In October 2019, Grubhub CEO Matt Maloney said in a letter to shareholders expanding such a practice was an important part of the company’s business strategy. At the time, Grubhub admitted in a statement to Eater that “the non-partnered model is no doubt a bad experience for diners, drivers and restaurants. But our peers have shown growth — although not profits — using the tactic, and we believe there is a benefit to having a larger restaurant network: from finding new diners and not giving diners any reason to go elsewhere.”
Such a practice has already made companies like Grubhub vulnerable to lawsuits, and the pandemic has shone even more of a spotlight on the relationship delivery apps have with restaurants, particularly when it comes to high service fees. But delivery problems have continued over the past year, even for restaurants that didn’t mind being on the apps. When iconic coffee shop Cafe Racer closed its U District location permanently in the summer of 2020, Uber Eats continued to take orders for several months from customers who saw the menu posted on the app and thought it was still open. Owner Jeff Ramsey tried to contact all the apps the cafe previously used to cancel services but wasn’t able to complete the process until early 2021.
This is not to mention numerous complaints from owners and staff at local restaurants who say they’ve gotten dinged for mistakes made by delivery drivers, customers seeing outdated menu items, or glitches on the apps themselves. Popular Frelard deli Schmaltzy’s, for instance, has ditched all third-party delivery services because of the service issues they’ve caused. The summary of the proposed Seattle legislation notes that such incidents “can damage a restaurant’s reputation and result in a loss of income if customers post poor reviews to discourage others from ordering from that restaurant.”
Seattle’s new bill aims to alleviate some of these headaches. If passed, there would be 90 days before the law goes into effect to give restaurants and platforms time to make adjustments and get new contracts signed. The city council will discuss the bill in committee Thursday, June 4, with a full vote expected around June 14.
Council president Lorena González tells Eater Seattle, “My office has heard from many local, independently owned restaurants about the challenges they’ve had to navigate during the pandemic. I’ve introduced CB 120092 to help restaurants maintain the guest experience they work so hard to build and execute by ensuring their presence on a delivery platform is in their hands, and they can continue to ‘own’ the guest experience from beginning to end.”
- Council Bill 120092 [Seattle City Council Official]
- New California Law Raptures Thousands of Restaurants from Postmates, DoorDash, and Grubhub [ESF]
- Grubhub Hit With Lawsuit for Listing Restaurants Without Their Permission [Eater]