B.C. follows Ontario by capping food delivery fees

More provinces are moving to cap food delivery fees charged by third-party apps and websites.

After Ontario officially brought in the measure last week, British Columbia has immediately followed suit.

The B.C. government has enacted an Emergency Program Act (EPA) order to place a temporary cap on fees charged to restaurants from food delivery companies to 15 per cent. An additional cap of 5 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 EPA order will be in force from Sunday, December 27, and will be in place until three months after the provincial state of emergency is lifted.

A news release notes that the aim of the measure is to ensure that 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.

“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.”

“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.”

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.”

Ian Tostenson, president and CEO, BC Restaurant & Foodservices Association, commented: “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 foodservice 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 its proactive and common-sense approach. This is truly an early Christmas miracle!”